After weeks of negotiations, referendums and bank and stock market closures, the Greek government agreed today to an 86 billion euro “bail-out” just as we expected.
We were fairly sure the troika of the IMF, ECB and EC would force their measures on Greece no matter what the opposition was, and that appears to be a good prediction.
We had some hope when the Greeks voted “no” regarding austerity, and suggested that might be the beginning of a sea-change regarding the euro and EU. But we also wrote this:
[The Eurocrats] will sit in splendor in some hotel or other and dine on sumptuous dishes washed down with expensive wines. Afterwards, they will nap. (The world, however, will receive notice that the principals are “huddled” in tense negotiations.) Eventually, after a series of Hobbit-like post-supper snacks lasting most of the night, they will stagger forth bleary-eyed to announce that the EU and the euro have just been saved.
This is what has happened over and over. The world has been treated to the endless heroics of pasty EU bureaucrats and European pols whose biggest challenge is to find room for dessert. These are endlessly the saviors of Europe. These are the Chosen Few fighting for the solvency of the euro.
The pattern is entirely predictable. These crises are staged – like shows. The build up can be years in the making. Tens of thousands of articles may be written. All sorts of scenarios examined. Eventually the top brains of the EU go to work and various solutions are offered but always with flaws.
Gradually the suspense builds. Deadines are imposed and missed. Only at the very last moment does a proper plan suddenly, magically appear. The financial and business media cheers. The system is saved.
Oh, sure, Brussels could have come up with the same thing years earlier, but what would be the point of that? No suspense, no tension, no heroism.
Because that’s what it is all about. Making these officials into heroes of a sort (or at least saviors of the system) and providing evermore centralized solutions that build the infrastructure of the Euro-state until finally it resembles (unwillingly) an actual nation.
The solutions, by the way, don’t really matter because Keynesian solutions never do. Their virtue is merely that they inflate the money supply and thus debase the currency.
Bluntly, Greece has too much government debt. It had a debt-to-GDP ratio of 175% and a total debt of 375 billion euros. So, how do you solve this problem of too much debt that cannot be repaid? According to the troika, it is to put the government into much, much more debt! 86 billion euros more, to be exact!
Yes, as before, the Greeks are told they must kick the garbage down the road… and give up even more sovereignty to the EU in the process. This process is so obvious by now it even has its own hashtag, #ThisIsACoup.
Meanwhile, banks remain closed in Greece as a form of financial terrorism to force Greeks to accept the deal. Capital controls also remain in place and may stay in place for the foreseeable future.
No problem was fixed here… it was just made worse. These crises are probably SUPPOSED to get worse until finally EU citizens throw up their collective hands and simply hand provide the power that Brussels demands. Anything to stop the bleeding. Anything to stop the pain.
This is how the EU “experiment” was built, in fact. It has always been a dishonest enterprise. Initially it was nothing more than trading union. Any ambitions to launch a currency or central bank were derided. Yet here we are and Europe has both and a growing army besides.
The sovereign debt crisis was predictable; so is austerity. The object is to make Greeks and then Southern Europeans generally as miserable as possible. And then to set a precedent.
It’s a dangerous game, especially in this internet era. People understand a lot these days. It’s not like the 20th century. Push people too hard and … bad things can happen.
We will have to wait to see if this “absolutely necessary” package gets passed by the Greek parliament this Wednesday. And what kind of protests/riots this sparks. Already government workers intend to strike on Wednesday. And how long it takes for Italy, Spain and Portugal to get “bailed out” in similar circumstances.
This story isn’t over… it’s just starting. We expect numerous crises to come to a head throughout this summer heading into September when we expect something, well … much worse (and we’ll be releasing an important video this week on what we expect – TDV subscribers are already aware of this information but we are releasing some of it publicly now to awaken as many people as possible of the coming collapse).
Meanwhile, bitcoin is doing what gold and silver should be doing… going up.
It has risen solidly throughout the last month from near $230 to over $310 earlier today for a gain of 33%.
At least one bitcoin ATM company is currently on the ground in Greece looking to start-up operations. Hopefully more Greek people know about bitcoin by the time the next crisis comes so they are not so easily held hostage.
What are your thoughts on the Greece “bail-out”?
Originally Appeared At The Dollar Vigilante