THE DECLINE AND
FALL OF THE EURO

By: S.R. SHEARER

INTRODUCTION

In November of 2007, I wrote:

"There is a great deal of talk today by "ninnies" and "know-nothings" that the falling dollar on the world's monetary exchanges denotes the collapse of the American Imperial System and the rise of Europe. Much is being made of the fact that as the dollar declines, the world's central banks will trade in their dollars for euros, displacing the dollar as the world's central currency ..." [Please see our article, "Ninnies, Know-Nothings and the 'Falling Dollar'."]

Of course, the American Imperial System has not collapsed; and more than that, the dollar continues to reign supreme, despite the many pronouncements of its demise, and it is the euro that is on "life-support."

The fact is, nothing seems able to shake the dollar's preeminence; it seems that America is not bound by the same economic rules that bind the rest of the world. Writing on this extraordinary phenomenon, Dr. Michael Hudson writes:

"Like most individuals, every nation would love to obtain the proverbial free lunch favoring its own interests while other countries passively refrain from promoting their own economies ... Today the United States has done so. AMERICA IS NOW ABLE TO RUN TRADE AND PAYMENTS DEFICITS AMOUNTING TO BILLIONS AND BILLIONS OF DOLLARS ANNUALLY WITH VERY LITTLE PROTEST FROM THE REST OF THE WORLD ..." [Please see our movie, GREED IS GOOD.]

The dollar continues to reign supreme

And there can be no question about it, THE EURO IS IN A LOT OF TROUBLE. Megan McArdle, a Washington, D.C.-based journalist who reports mostly on economics, finance and government policy, writes:

"There has been a lot of talk about the trouble the dollar is in, but we might better be worrying about the euro." 

Philipp Bagus, a professor at Universidad Rey Juan Carlos in Madrid and a visiting professor at Prague University, agrees; he writes:

"Concerns about the public finances of eurozone countries Portugal, Ireland, Italy, Greece, and Spain, the so-called 'PIIGS', have emerged in financial markets. Greece is facing the severest crisis, with its 10-year bond yield approaching 7%."

NOTE: What this means is that Greece must pay an astounding 7% interest rate in order to attract money with which to fund its debt;

"The Greek government estimates its budget deficit at 12.7% of GDP in 2009. Gross government debts amount to 113% of its GDP. If the interest rate Greece has to pay for its debts keeps rising, the country may have to default on its obligations."

The so-called "PIIGS" nations (Portugal, Italy, Ireland, Greece and Spain) are teetering on the edge insolvency; of being unable to pay the interest on their debt. Deficit spending by member states of the Euro-bloc of nations is not supposed to exceed three percent of GDP; and total government debt is not supposed to exceed 60 percent of GDP; but that's not what is happening: The budget deficits of all the PIIGS nations greatly exceed 3 percent of GDP, and the total government debt of all these nations exceeds 60 percent of GDP. In other words, THESE NATIONS ARE ALL IN GRAVE DANGER OF DEFAULTING ON THEIR DEBTS - causing a run on those financial institutions who are the bondholders of the debt accrued by these countries.

Bryan Rich, a well-known financial analyst, writes:

"All of these countries [i.e., the "PIIGS" nations] are running massive budget deficits, many have huge debt burdens and all have muted prospects for growth."

Rich labels these countries as -

"Weak spots [that] could threaten the Eurozone's stability."

Rich continues:

"Greece may finally be reaching the end of its ability to borrow at any price, and what the euro zone does about this crisis--the EU is statutorily forbidden to intervene--may determine whether the euro ultimately survives.

"Greece has already accumulated a mountain of debt that will be difficult if not impossible to pay off. The government has borrowed more than 110 percent of the country's economic output over the years, and if investors lose confidence in the bonds, a meltdown could happen as early as next year.

"That's when the government borrowers in Athens will be required to refinance $25 billion worth of debt -- that is, repay what they owe using funds borrowed from the financial markets. But if no buyers can be found for its securities, Greece will have no choice but to declare insolvency -- just as Mexico, Ecuador, Russia and Argentina have done in past decades.

"This puts Brussels in a predicament. European Union rules preclude the 27-member bloc from lending money to member states to plug holes in their budgets or bridge deficits.

"And even if there were a way to circumvent this prohibition, the consequences could be disastrous. The lack of concern over budget discipline in countries like Spain, Italy and Ireland would spread like wildfire across the entire continent. The message would be clear: Why save, if others will eventually foot the bill?

"On the other hand, if Brussels left the Greeks to their own devices, the consequences would also be dire. Confidence in the euro would be shattered, and the union would face a crucial test. What good is a common currency, many would ask, if some of the member states pay their debts while others do not?

"Furthermore, there is a threat of a domino effect. If one euro member falls, speculators will test the stability of other potential bankruptcy candidates. This could destroy the currency union ..."

There is bitterness among some of the larger economies that they share the same currency as countries like Greece and may have to bail them out; this dissatisfaction is especially prominent in Germany where many GERMANS HAVE BECOME SO DISILLUSIONED WITH THE EURO, THEY WILL NOT ACCEPT NOTES PRODUCED OUTSIDE THEIR HOMELAND - and many have begun hoarding pounds and dollars.

German demonstrators burning EU flag.

ALL THIS TO SAY, WHILE THERE MAY BE A FINANCIAL CRISIS IN THE U.S. IT DOES NOT BEGIN TO MATCH THE CRISIS THAT IS BREWING IN THE EU - A CRISIS THAT THREATENS TO BREAKUP THE CONTINENT INTO A SERIES OF MIDGET NATIONS ALL CLAMORING TO SAVE THEMSELVES FROM THE WORLD-WIDE FINANCIAL DEBACLE.

We need your help to spread the word concerning Antipas Ministries and the eschatological viewpoint it represents; WE NEED YOUR HELP BECAUSE WE DO NOT "LINK" WITH OTHER SO-CALLED "CHRISTIAN" WEBSITES which are, for the most part, "in the tank" insofar as their loyalty to the United States is concerned - a loyalty that has made them partners in the BLOODY trail the American military has left in its TERROR-RIDDEN rampage throughout the world, as well as making them partners in the abject poverty that American corporations have imposed on the peoples and nations the American military machine has ravaged - A BLOODY, TERROR-RIDDEN RAMPAGE THAT HAS TO A LARGE DEGREE BEEN CARRIED OUT IN THE NAME OF THE "PRINCE OF PEACE." [Please see our articles, "The Third World as a Model for the New World Order," Inside the American New World Order System" and "The American Empire: The Corporate / Pentagon / CIA / Missionary Archipelago."]

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