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Europe Plan B: Prepare for return of old currencies, plan to evacuate citizens from PIIGS countries

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posted on Dec, 26 2011 @ 03:28 AM
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Plan A - Create a Long Term Refinancing Operation (LTRO) by the ECB so that banks can exchange bad assets in return for liquidity
Plan B - Return to old currencies and watch the value of the Euro fall and liquidity of Euro banks.

In a WSJ article from the 24th here's the problem as Alastair Newton states:

As soon as you start contingency planning . . . it can become a foregone conclusion," said Alastair Newton, senior political analyst at Nomura PLC. "But if things go wrong and you don't have plans in place, you're in trouble"
- online.wsj.com... (12/24/11)

But they already did open those gates in a Reuters article from the 7th:

Within the euro area, official discussion of the topic was completely taboo until French President Nicolas Sarkozy and German Chancellor Angela Merkel raised the possibility of a Greek euro zone exit last month. The survival of the currency came first, they said.

"That immediately released the shackles on governments to contingency plan for that reality," says Alastair Newton, a former UK Cabinet Office and Foreign Office official and now chief political analyst for Japanese bank Nomura. "Before that, they couldn't plan because if they did it would leak out and then it could become a self-fulfilling prophecy."
...
British newspapers have been full of stories about Foreign Office planners drawing up emergency schemes to assist or even evacuate Britons from a collapsing euro zone. Government officials declined comment on specific stories but some said they were re-examining long-held assumptions about Europe's stability.
www.reuters.com... (12/7/11)

Looks like either WSJ and/or Zerohedge was late hearing about it, since they echo this on the 25th:

...in Europe, the mere admission that Plan B is a possibility, apparently set off a chain of events that makes Plan B an inevitability: "...officials there feared that releasing the information could fuel further doubts and instability in the euro zone."
...
The U.K. Foreign Office has begun making contingency plans to evacuate U.K. residents from Spain and Portugal in the case of bank meltdowns in those countries, said a person familiar with the matter. In a sign of concern over stirring panic, a spokesman was tight-lipped about details apart to say that office is always preparing for all types of scenarios.
- www.zerohedge.com...

Why evacuate U.K. residents from other countries?

Back the the Reuters article on the 7th:

Logistics and law enforcement also need serious thought, experts say. Capital and border controls might need to be tightened as states leaving the euro try to replace one currency with another. "While the public might tolerate capital controls, ATMs shutting will not be tolerated," said the British official, speaking on condition of anonymity. ...


Tough to survive in a foreign country during social unrest, your cash falls in value, and banks can't give you more cash.




posted on Dec, 26 2011 @ 03:38 AM
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reply to post by Dbriefed
 
This sounds pretty bad, but they said this was going to happen.
Now where does that leave the Amero? Not!



posted on Dec, 26 2011 @ 03:41 AM
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I'm so glad we kept GBP/sterling, I never trusted the Euro.



posted on Dec, 26 2011 @ 03:52 AM
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I can not see those who are at the core of the European project going silently into the darkness nor can I see them opening the door to level of anger that going "plan b" would cause especially since it puts their necks squarely on the block.

So I lean and have always leaned towards the notion that prior to any next crash that pent up anger frustration would be manipulated and redirected elsewhere.. I guess the "who" it will be directed at doesn't matter to those in the establishment as long as it is redirected away from them.

Numerous nations from the US to Iran to Britain are all on the scapegoat list for one side or other.. and redirecting the anger onto a scapegoat is of benefit to all sides establishments in any coming crash.

My hope is that we do not sink that far.. yet I also know the current system has to break.. it seems to me we are in between a rock and a very hard place with ever decreasing options as to what happens next.



posted on Dec, 26 2011 @ 04:54 AM
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I tend to keep ideology and finance separate in my mind...but the euro is a project I won't be sad to see shelved, provided that it can be done with minimal damage to the citizenry, which I think is possible. Basically the eurozone needs to follow in the footsteps of Iceland and tell the bankers to go jump off a cliff. Iceland is now growing fast as the rest of the world is mired in bankster games. We need "one, two, many Icelands," to mangle an old slogan...



posted on Dec, 26 2011 @ 05:08 AM
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reply to post by Dbriefed
 



Originally posted by Dbriefed

Why evacuate U.K. residents from other countries?

Back the the Reuters article on the 7th:

Logistics and law enforcement also need serious thought, experts say. Capital and border controls might need to be tightened as states leaving the euro try to replace one currency with another. "While the public might tolerate capital controls, ATMs shutting will not be tolerated," said the British official, speaking on condition of anonymity. ...


Tough to survive in a foreign country during social unrest, your cash falls in value, and banks can't give you more cash.

I'm sure you're right to identify those issues. However there's another element that needs considering: if the PIIGS go down the UK will quite possibly not be far behind. In the short term UK banks would be hit with both a liquidity crisis (due to the interconnectedness of the banking system) plus questions over capitalisation (—due to insurance claims on sovereign debt). In both the short and medium term demand for UK exports would collapse. To cap it all the UK's financial services-dependent economy would start to implode, as it has undergone aggressive expansion into Europe.

...So evacuating people would do little to protect them from collapse. It would probably just mean they'd be queueing up outside British banks instead of foreign ones.

Oh the joys of globalisation.



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