It looks like you're using an Ad Blocker.

Please white-list or disable AboveTopSecret.com in your ad-blocking tool.

Thank you.

 

Some features of ATS will be disabled while you continue to use an ad-blocker.

 

If the new Europe bailout goes through, Germany gets to shoulder most of Europe's debts

page: 1
3
<<   2 >>

log in

join
share:

posted on Jul, 21 2011 @ 06:28 PM
link   
The Fatal Flaw In Europe's Second "Bazooka" Bailout: 82 Million Soon To Be Very Angry Germans

Simply said Greek debt will continue growing as a percentage of its GDP, meaning it, and Ireland, and Portugal, and soon thereafter Italy and Spain will be forced to borrow exclusively from the EFSF. Therein lies the rub. In a just released report by Bernstein, which has actually done the math on the required contributions to the EFSF by the core countries, the bottom line is that for an enlarged EFSF (which is what its blank check expansion today provided) to be effective, it will need to cover Italy and Belgium. As AB says, "its firepower would have to rise to €1.45trn backed by a total of €1.7trn guarantees." And here is where the whole premise breaks down, if not from a financial standpoint, then certainly from a political one: "As the guarantees of the periphery including Italy are worthless, the Guarantee Germany would have to provide rises to €790bn or 32% of GDP." That's right: by not monetizing European debt on its books, the ECB has effectively left Germany holding the bag to the entire European bailout via the blank check SPV. The cost if things go wrong: a third of the country economic output, and the worst case scenario: a depression the likes of which Germany has not seen since the 1920-30s. Oh, and if France gets downgraded, Germany's pro rata share of funding the EFSF jumps to a mindboggling €1.385 trillion, or 56% of German GDP!

The Europarliament, ECB and IMF may have won their Pyrrhic victory today... But what happens tomorrow when every German (in a population of 82 very efficient million) wakes up to newspaper headlines screaming that their country is now on the hook to 32% of its GDP in order to keep insolvent Greece, with its 50-some year old retirement age, not to mention Ireland, Portugal, and soon Italy and Spain, as part of the Eurozone? What happens when these same 82 million realize that they are on the hook to sacrificing hundreds of years of welfare state entitlements (recall that Otto von Bismark was the original welfare state progentior) just so a few peripheral national can continue to lie about their deficits (the 6 month Greek deficit already is missing Its full year benchmark target by about 20%) and enjoy generous socialist benefits up to an including guaranteed pensions? What happens when an already mortally wounded in the polls Angela Merkel finds herself in the next general election and experiences an epic electoral loss? We will find out very, very shortly.

Of course, Germany won't have to pay the bills... IF, all the PIIGS countries do the reforms needed in time (which has NO CHANCES of happening).... so Germany is being screwed right then and there if this BS passes.


And there you have it: the cost of the euro not plunging today as a result of the ECB not proceeding with outright monetization, is that Germany is now the ultimate backstopper of all of Europe's risk. And while before, when the EFSF was just over €400 billion or so, the market could largely ignore the risk, a €1.5 trillion "upgrade" certainly changes the equilibria dynamics. In an attempt to avoid the appearance of inviting inflationary pressures on Trichet's central bank, Germany has directly onboarded the risk associated with terminal failure of this latest and riskiest "bailout" plan and in doing so may have jeopardized anywhere between 32% and 56% of its entire annual economic output. One wonders if the risk of runaway inflation is worth offsetting the risk of a plunge into the worst depression in the nation's history? It sure isn't for the Fed.

The most ironic outcome would be if the eurozone, in an attempt to prevent further contagion at the periphery, simply invited the vigilantes to bypass Italy (recall how everyone was shocked that instead of attacking Spain, it was Italian spreads that got destroyed in a manner of days), and head straight for the country on whose shoulders lies the fate of the entire EUR experiment?

Germany would be like the AIG of Europe... holding all the toxic debt of the PIIGS.

Yeah setting up the Germans for the SECOND TIME sure is gonna end well uh? It worked so well just after WW1, enslaving Germans to the bankers... that totally ended up with peace, rainbows and unicorns uh?

Totally disgusting. Germany needs to elect new REAL LEADERS and get the hell out of the Euro and the European Union... arrest all those corrupt bankers in Germany and seize their assets.... or it's gonna end real badly.

Come on Germany, don't fall into the trap of the elite once again... turn against them.
edit on 21-7-2011 by Vitchilo because: (no reason given)



posted on Jul, 21 2011 @ 06:46 PM
link   
That's good.karma is at work.



posted on Jul, 21 2011 @ 06:52 PM
link   
FOOOLS

secure.wikimedia.org...



The European Economic Community

Already in late 1940 with the view argued here Hunke, the peoples of Europe would be united as a result of the German economic recovery to a large workgroup. On this basis, he derived a projection of the consequences of this economic community:

1st Instead of the market will come to exploit the productive forces of the nations. Furthermore, the freedom of labor will replace the freedom of the economy because they wanted to produce not only goods in the world market prices, but also those who allow the forces of the people and space. At the same time he spoke out against a customs union because it was just a means of economies at the same level.

2nd Hunke was as objective to build a Habitat community, which had not thought about the destruction of the monocultures. The economic self-development in Europe will result from the focus of the German national economy. However, the small nations in Europe note that they would rely on their neighbors. The difference with the previous liberal rules of the game will be that these countries had the European Economic Community a safe and good customers for the goods. That they could not achieve on their own.

3rd In contrast to the British economy considers the goal of German economic policy will be to observe the eastern and southeastern Europe more, as had already happened in the past seven years. Not only are most profitable projects should be realized that appears.

4th As the crowning goal of the European Economic Community Hunke postulated full employment, such as Germany have already implemented it. The development of crucial parts of the continent would employ forces to a degree, of which only a few make today the right idea.

At the conclusion of the article was still Hunke from a prophecy: for the old continent began a new era. People and space are no more props, but they formed the state's life and are carriers of the development.


its all staged...


the guy who wrote this was after wwII member of the Naumann-Group:
secure.wikimedia.org...


The Naumann Circle was a group of former Nazis by Werner Naumann, the last secretary of state propaganda minister Joseph Goebbels. She tried to 1952/53, the FDP to infiltrate nationwide...


the FDP is currently running the country in coop with the christian conservativ party (CDU)...



reply to post by Bixxi3
 

not really...like germany was the only one during that time...there was spain & italy with direct facism and dictatorship too...dont misinterpret the third reich and hitler...it wasnt only germany...
edit on 21-7-2011 by Hessdalen because: mindcontrol



posted on Jul, 21 2011 @ 06:59 PM
link   
reply to post by Vitchilo
 


Hi Vitchilo, this thread of mine will compliment your's with some further reading on the 400 Billion Pound Euro debt bomb.www.abovetopsecret.com...

This is not looking good today as we discussed in another thread of your's.They are calling today Black Friday.Saying that both Merkel and Sarkozy have rejected the bail out.www.bloomberg.com... Don't know what to believe at the moment,to many conflicting reports.
Going to be an interesting 24 hrs.Notice this always happens on a Friday when the market closes and nobody has access to their investments.

I don't think that Europe is going to know what hit them when they wake up this morning.TheY are damned if they do and damned if they don't. S&F for you,this is a big story and I think that we both see the same thing.


edit on 21-7-2011 by 13th Zodiac because: (no reason given)

edit on 21-7-2011 by 13th Zodiac because: (no reason given)



posted on Jul, 21 2011 @ 07:13 PM
link   
reply to post by 13th Zodiac
 

they know everything, in fact it was discussed at the bilderberg meeting and fer sure they know that there is no way for greece to pay the money back...italy will also be heavy but has its possebilitys (vatican and mafia/p2) to handle it on their own...sarkozy is in fear of his own country not cause of the economy but cause of the socio-cultural problems (same with netherlands) and by this in favour of the "trouble"...spain and portugal is also not in real danger, just in need to be reformed by german precision...the rest is fine...or in other words - not in danger...

edit on 21-7-2011 by Hessdalen because: mindcontrol



posted on Jul, 21 2011 @ 07:26 PM
link   
Reading some comments on the New York Times from Germans, they seem to be happy with the deal.
Examples are here, here, here and here.



posted on Jul, 21 2011 @ 07:35 PM
link   

Originally posted by surrealist
Reading some comments on the New York Times from Germans, they seem to be happy with the deal.
Examples are here, here, here and here.


Every German I have talked to so far (mainly friends and family) is absolutely disgusted with the way things are going, so I wonder where the NYTimes got their happy Germans from?



posted on Jul, 21 2011 @ 07:35 PM
link   
Edit:
Please delete, double-post. Again. Something is wrong with my computer today...
edit on 21-7-2011 by Whipfather because: (no reason given)



posted on Jul, 21 2011 @ 08:06 PM
link   

Originally posted by Whipfather

Originally posted by surrealist
Reading some comments on the New York Times from Germans, they seem to be happy with the deal.
Examples are here, here, here and here.


Every German I have talked to so far (mainly friends and family) is absolutely disgusted with the way things are going, so I wonder where the NYTimes got their happy Germans from?


Must be a Pollyanna moment for some!



posted on Jul, 21 2011 @ 09:36 PM
link   
The german public is not happy about this and I suspect that DSK may have been coerced to resign because he was open to allowing germany to NOT bail out Greece/ireland.



posted on Jul, 21 2011 @ 10:29 PM
link   
You'd think there would be some critical analysis or at least some boisterous commentary coming from German newspapers. I had a look online at a couple of German English editions and there isn't much to report. Maybe the media there love their politicians?



posted on Jul, 21 2011 @ 11:09 PM
link   
reply to post by Bixxi3
 


care to elaborate?



posted on Jul, 22 2011 @ 05:12 AM
link   
the germans are not happy...i can tell you...



posted on Jul, 22 2011 @ 07:00 AM
link   
This is what the Germans get for electing a Russian-speaking Easterner who was born on the same date as Hitler.


edit on 7/22/2011 by eldard because: (no reason given)



posted on Jul, 22 2011 @ 07:16 AM
link   

Originally posted by Agit8dChop
reply to post by Bixxi3
 


care to elaborate?


Oh like you don't know...



posted on Jul, 22 2011 @ 08:18 AM
link   
And we all know that when Germany is footing the bill for the rest of Europe that always ends well for the rest of the world. Think Treaty of Versailles and WWI reparations.



posted on Jul, 22 2011 @ 08:23 AM
link   
Isn't Germany the only producer they have in Europe? At least as well as a Socialist State can be expected to do?

Of course it falls to them to support the rest of that lousy continent.

I mean, when I think of Europe, it's about history and food, not economics...Germany has earned a different reputation than say the French or Italians...



posted on Jul, 22 2011 @ 08:48 AM
link   
reply to post by Bixxi3
 


Hey, the Americans genocided entire towns in my country, too. I want them to pay!!!


two



posted on Jul, 22 2011 @ 09:04 AM
link   
The Last time Germany had to pay for the rest of europe the contract was called the Treaty of Versailles.

As I recall Germany got pretty cranky over it. Since they are unified once again let's not invite WWIII by poking the leapard with a stick.



posted on Jul, 22 2011 @ 09:24 AM
link   

Originally posted by TreadUpon
Isn't Germany the only producer they have in Europe? At least as well as a Socialist State can be expected to do?

Of course it falls to them to support the rest of that lousy continent.

I mean, when I think of Europe, it's about history and food, not economics...Germany has earned a different reputation than say the French or Italians...


Germany is not Socialist. It is a Republic, as is France.







 
3
<<   2 >>

log in

join