Have nothing to do with the [evil] things that people do, things that belong to the darkness. Instead, bring them out to the light... [For] when all things are brought out into the light, then their true nature is clearly revealed...

-Ephesians 5:11-13

Tag Archives: European Central Bank

Greece Passes into History as a Sovereign Nation

This article was published by The McAlvany Intelligence Advisor on Wednesday, July 15, 2015:

Coat of arms of Greece since 7 June 1975.

Coat of arms of Greece since 7 June 1975.

From Genesis 25 one finds this:

Once when Jacob was cooking some stew, Esau came in from the open country, famished. He said to Jacob, “Quick, let me have some of that red stew! I’m famished!” (That is why he was also called Edom.)


Jacob replied, “First sell me your birthright.”


“Look, I am about to die,” Esau said. “What good is the birthright to me?”


But Jacob said, “Swear to me first.” So he swore an oath to him, selling his birthright to Jacob.


Then Jacob gave Esau some bread and some lentil stew. He ate and drank, and then got up and left.


So Esau despised his birthright.

After suffering through some 17 hours of haranguing and browbeating last weekend, Greece’s Prime Minister Alexis Tsipras gave away Greece’s national sovereignty for some bread and a bowl of lentil stew.

And the stew smelled to high heaven.

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The Great Greek Yard Sale

This article appeared online at TheNewAmerican.com on Tuesday, July 14, 2015:  

The great capitulation by Greece’s Prime Minister Alexis Tsipras last weekend will shortly be followed by the great Greek yard sale. Calling it an agreement rather than an ultimatum, the Eurozone statement from its ministers spelled out in painful detail the degree to which Greece will have lost its sovereign powers if the country’s parliament agrees to it.

First, Greece must accomplish the following no later than midnight Wednesday, July 15:

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The Root Cause of Greece’s Problems: Socialism

This article was published online at TheNewAmerican.com on Monday, July 13, 2015:  

English: Alexis Tsipras in a press conference ...

Alexis Tsipras

Returning to Brussels with an austerity program eerily similar to that just rejected by Greek citizens a week ago, Prime Minister Alex Tsipras hoped to obtain another bailout in exchange for debt forgiveness by the European Central Bank (ECB). Tsipras is desperate: His government must make a $7.8 billion payment to the ECB next Monday, and another $13 billion by the middle of August.

Instead, following marathon sessions lasting into the wee hours, those EU officials upped the ante, passing even more stringent demands before granting Tsipras his lifeline. It told Tsipras, in essence, either to paint or get off the ladder:

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Greece-EU Standoff Increases Chances of “Grexit”

This article appeared online at TheNewAmerican.com on Tuesday, July 7, 2015:  

UK Independence Party

Writing in London’s Telegraph on Monday, Nigel Farage, the leader of the anti-EU, pro-sovereignty UK Independence Party (UKIP), called Sunday’s referendum in Greece “a crushing defeat for those Eurocrats who believe that you can simply bulldoze public opinion.” Threats by those Eurocrats to shut off emergency financing unless the country agreed to its terms fell on deaf ears, especially among those under age 35: Eighty percent of them voted no on Sunday.

That cohort is the one least likely to remember the songs that were sung by those promoting the European Union decades ago:

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Greeks Shout “NO!”

This article was published by The McAlvany Intelligence Advisor on Monday, July 6, 2015:  

Greek citizens shouted “No!” to further austerity measures for the hapless country in exchange for more of what got it into trouble in the first place: other people’s money. The lopsided 60-40 vote astonished telephone pollsters, who predicted a much narrower victory for Greek Prime Minister Alexis Tsipras of the far-left Syriza party. Although the issues were far more complicated than the referendum made it appear, the 68-word ballot question made it easy: do you want more increases in taxes, more cuts in pension benefits, another increase in the VAT … or not?  Translated into English, the ballot read:

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Greece to the EU: NO!

This article was published online at TheNewAmerican.com on Monday, July 6, 2015:  

In an astonishing blow to the European Union’s credibility, Greek voters, fed up with five years of austerity, continuing recession, 25-percent unemployment, and severe cuts in pension payouts, strongly said “No!” at the ballot box Sunday. The 68-word ballot question, rejected by 61 percent of the voters, reads (translated into English):

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Greek Referendum to Determine European Union’s Viability

This article appeared online at TheNewAmerican.com on Thursday, July 2, 2015: 

Cover of "Confessions of an Economic Hit ...

The latest polls show that on Sunday Greek citizens are likely to reject the terms of the bailout from the troika — the European Union, the European Central Bank (ECB), and the International Monetary Fund (IMF) — but by a steadily decreasing plurality. Before Prime Minister Alexis Tsipras announced the referendum, polls showed voters were opposed to the bailout terms, 57 to 30 percent. When the banks closed and citizens were restricted to withdrawing just $67 a day from their ATMs and pensioners couldn’t cash their checks, polls showed a narrowing, 46 to 37 percent.

Tsipras repeatedly said that the referendum is only about accepting or rejecting the terms imposed by the troika, not about leaving the euro or the European Union: “No does not mean rupture with Europe but a return to Europe with values.”

Citizens weren’t impressed and

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Greece: Capital Controls Threat Increases as Deadline Approaches

This article first appeared online at TheNewAmerican.com on Monday, June 22, 2015:

The announcement last week by Greece’s central bank that it may be forced to start implementing capital controls — eliminating the ability of Greeks who still have any money in the bank to withdraw it or send it to another country for safekeeping — may just be a ploy to bring more pressure on the Troika (European Central Bank, IMF, and eurozone countries) to release the last batch of funds from Bailout Number Three.

Withdrawals by nervous Greeks began last fall as Bailouts Number One, Two, and Three were only pushing the country further into recession. Withdrawal from the eurozone itself became increasingly likely, with the result that the euro would be replaced in Greece with a new currency with much less purchasing power.

Ever since Greece joined the European Community, later to be called the European Union, it has enjoyed far better credit ratings than it deserved. Assured that default was now no longer an option, central banks and other international financial institutions were more than willing to

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More Keynesian Insanity: Negative Interest Rates

This article first appeared at The McAlvany Intelligence Advisor on Monday, May 4, 2015:

There’s a corollary to the insanity rule. It’s called the Keynesian Corollary: When something doesn’t work, do more of it. When history is written about the coming Second Great Recession, historians will likely note July 2012 as the turning point. That was when Mario Draghi, head of the European Central Bank (ECB) said during a panel discussion that the ECB “is ready to do whatever it takes to preserve the euro. And believe me, it will be enough.”

Other historians might list that as one of the top ten “famous last words” ever issued by a human being. Since that moment bond yields across the world have dropped, and dropped, and dropped. On Thursday Jeremy Warner, the London Daily Telegraph’s assistant editor, announced that

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Swiss Bank Referendum Fails, Franc Drops

This article first appeared online at TheNewAmerican.com on Thursday, December 4, 2014:

Banknotes of the Swiss franc

Banknotes of the Swiss franc

The Swiss voted down the initiative “Save Our Swiss Gold” on Sunday, November 30, by a margin of three to one, rejecting efforts to shore up the Swiss National Bank’s (SNB) balance sheet. Switzerland, a direct democracy, entertains an average of five such referendums every year, and most of them fail. This initiative would have required the SNB to boost its gold bullion holdings from its current eight percent level to 20 percent over the next five years. It would also have required the central bank to repatriate its foreign-held gold reserves, while prohibiting it from ever selling any of those reserves in the future.

When first proposed, speculators bought the Swiss franc cheap, hoping to sell it dear if the initiative passed. Investors in gold were holding their breaths as well, noting that

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Treasury Refuses to Sell Its Gold Even in the Event of Default

It took more than six months for the Department of the Treasury to answer Utah Republican Senator Orrin Hatch’s questions about how the Treasury would respond to a government shutdown or the failure of the Congress to raise the debt limit. But its response is revealing:

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Staff Report from the IMF Blames the European Union for Mishandling the Greek Crisis

The report from the International Monetary Fund is remarkable in its candor: efforts to bail out Greece were fumbled as the IMF, the European Commission and the European Central Bank all tried to promote their own agendas with little regard for the lowly Greek citizen.

Happily the disclaimer appeared on the front page:

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If you were sick, what would you do if your doctors told you this?

You’re sick. You’ve been sick for several weeks now. You’re long past the “take two aspirin and call me in the morning” protocol. You’re jaundiced, you’re not sleeping well, you’re losing weight, people are asking if you’re ok, the whole deal. You decide to find a doctor. You find four, all in the same office.

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Bank of Cyprus Expands Robbery of Depositors’ Money

Outrage upon outrage. Audacity upon audacity. In an email to its depositors last week, the wonderful amazing Bank of Cyprus informed its trusting depositors that it was going to take more of their money. Instead of limiting the theft of amounts over $130,000 to 40% the BOC is raising the amount of the robbery to 60%!

But there’s good news!  37.5% of the theft will be converted into ownership in the wonderful amazing bank with – ready? – full voting rights! And, in addition – wait for it! – they will receive any dividends the bank might declare in the future accruing to that ownership!

Oh, but there’s bad news as well. Sorry. The wonderful amazing BOC is going to withhold “temporarily” an additional 22.5% to “ensure” that the bank can meet the terms imposed by its new true real owners: the Eurozone commission, the International Monetary Fund and the European Central Bank.

It gets even better. The BOC is setting up a commission (always good to hear that) to study 1) just how long that “temporary” hold will be, and 2) the possibility that that additional amount will also be converted into ownership of the wonderful amazing bank. Here’s how Bloomberg phrased it:

The Central Bank of Cyprus will appoint an independent valuer for the commercial lender and all or part of the 22.5 percent additional haircut may also be converted into shares within 90 days of that process being completed, according to the statement. Any remaining amount will be returned to customers with interest, the central bank said.

But not everyone gets to participate in this wonderful amazing opportunity to own a part of a wonderful amazing bank. Only if you have more than $130,000 in your account do you get to participate. If you have less than that, well, too bad, you’ll just have to muddle through without being offered this grand opportunity:

The so-called bail-in won’t apply to Bank of Cyprus account holders whose debts to the lender bring their net balance below the 100,000-euro threshold, according to the statement. Holders of accounts at other banks on the Mediterranean island aren’t being touched.

Well, shoot! It must mean that only depositors at the wonderful etc. BOC will be able to participate. This is discrimination! This is unfair! There ought to be a law!

The message being sent via email by the BOC is being received by every bank depositor in the world: your bank can take your money and keep it. That’s just how things are these days. Get used to it.




Cyprus Deal Turns Bank Depositors into Lenders, Abolishes National Sovereignty

Late Sunday night the president of Cyprus, Nicos Anastasiades, was officially informed of the deal the unelected Eurogroup had come up with in order for Cyprus to receive its bailout from the European Central Bank. Anastasiades flew to Brussels on Sunday to meet with Mario Draghi, the president of the European Central Bank (ECB), Christine Lagarde, the managing director of the International Monetary Fund (IMF), and Jose Barroso, the president of the European commission. The meeting was run by Herman Van Rompuy, the president of the European Council. On his way to the meeting, Anastasiades admitted that

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Making Sense of Europe’s Nonsense

The official emblem of the European Parliament.

The official emblem of the European Parliament. (Photo credit: Wikipedia)

Anthony Wile is at it again. While most were caught up in the national election and the aftereffects of Hurricane Sandy and General Betrayus, Angela Merkel, the German Chancellor, explained what the implosion in Europe is all about. In speaking to the European Parliament last Wednesday, she shed all cover and told all who would listen what’s really going on:

Of course the European Commission will one day become a government, the European Council a second chamber and the European Parliament will have more powers – but for now we have to focus on the euro and give people a little more time to come along.

Wile has been saying this for years. That’s part of why his blog has grown so rapidly: he sees with a view and an insight that truth seekers appreciate. Out of 644 million active websites  Alexa ranks www.thedailybell.com at 16,991 in the United States. More than 6,700 people come to his Switzerland-based website every day. And his readership has grown 60% just in the last three months.

He’s like the 500-pound canary: when he speaks, people listen!

He notes that the European Union was always, from the very beginning, designed with

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The Trouble with Outright Monetary Transactions

Mario Draghi presents his credentials as candi...

Mario Draghi presents his credentials as candidate ECB president (Photo credit: European Parliament)

Mario Draghi, President of the European Central Bank (ECB), spoke before Germany’s Parliament on Wednesday, defending his decision to purchase government bonds from member states needing financial assistance but without unleashing inflation. Similar to the Federal Reserve’s continuing attempts to stimulate the economy through the purchase of government securities, called Quantitative Easing, or QE, Draghi’s Outright Monetary Transactions, or OMT, “will not lead to inflation,” he claimed in the closed-door session. He said:

In our assessment, the greater risk to price stability is currently falling prices in some euro-area countries. In this sense, OMTs are not in contradiction to our mandate; in fact, they are essential for ensuring we can continue to achieve it.

This is utter nonsense, wrote Mish Shedlock, in his blog Global Economic Analysis. Since Draghi’s “mandate” is similar to that of the Federal Reserve — that is, to maintain price stability along with low unemployment — it’s impossible to increase the supply of money by buying government bonds with credits created out of thin air without eventually unleashing price inflation at the consumer level in the economy. Shedlock wrote:

The problem with such nonsense is you cannot break the law while screaming you are upholding it. Draghi now sounds and acts like hypocr[itical] US presidents of both political parties.

Both President Bush and President Obama (as well as the treasury departments under each administration) have shown little concern for the law. Increasingly presidents are of the mind [that] “we have to destroy capitalism [in order] to save it” or as President Bush stated and Obama practices: “ I’ve abandoned free-market principles to save the free-market system.”

What the members of the German Parliament wanted to hear was that Draghi would not be

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Quick! Who is the Most Powerful Person on the Planet?

English: EPP Congress Bonn: Podium discussion ...

(Photo credit: Wikipedia)

Mario Draghi. Who? According to Matthew Lynn, writing at MarketWatch.com, “measured by what [he] can actually do, the most powerful person will soon be the president of the European Central Bank, the Italian banker Mario Draghi.” He explains:

In the last few weeks, we have seen an extraordinary expansion of the European Central Bank’s powers. It can now set interest rates, control financial markets, and effectively dictate tax and spending policies across what remains — despite its current difficulties — the world’s largest single economic bloc.

To explain how this former Goldman Sachs executive  ascended to such a high perch in the world of international finance would take far more room than we have here. Suffice to say, the path to power has been under construction for decades, and deliberately planned, going all the way back to

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German High Court Approves Step Toward European Dictatorship

English: European Central Bank ECB Eurotower i...

English: European Central Bank ECB Eurotower in Frankfurt a.M. Germany Deutsch: Europäische Zentralbank EZB Eurotower in Frankfurt a.M. (Photo credit: Wikipedia)

The decision on Wednesday by Germany’s Federal Constitutional Court that clears the way for the European Stability Mechanism (ESM) to extend its power over the national sovereignty of the eurozone’s member states was celebrated as a victory to save the euro.

It was nothing of the sort. It was instead a political victory for dictatorship in the name of the euro.

By putting some temporary limits on just how much the German government can contribute to the ESM, the decision made it appear to be prudent and careful and protective of Germany’s national sovereignty. The court said that Germany’s contribution cannot exceed the currently agreed to amount of $250 billion without approval by the Bundestag, the lower house of the German parliament (roughly equivalent to the House of Representatives in the United States). And the court also required that funds given to the ESM must be

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Spain is Bleeding to Death

Ambrose Evans-Pritchard: Deposit flight from Spanish banks smashes record in July

Data from the European Central Bank shows that outflows from Spanish commercial banks reached [$92 billion] in July, twice the previous monthly record. This brings the total deposit loss over the past year to 10.9 percent [of deposits]…

Mariano Rajoy en Bilbao. Imagen tomada por Ike...

Mariano Rajoy en Bilbao. Imagen tomada por Iker Parriza (Photo credit: Wikipedia)

In any capitalist economy, bank deposits represent capital in liquid form. Spain is bleeding to death. Evans-Pritchard quotes another expert:

This is highly significant. Deposit outflows are clearly picking up and the balance sheet of the Spanish banking system is contracting.

This is called deflation: a contraction in the supply of money.

I give blood on a regular basis. But I’m only allowed to give one pint at a time, and I can’t go back in less than six weeks to give another pint. Once, when I was into bike racing, I was reminded by Penrose Hospital that it was time to give blood again. I waited until after the race was over. I wanted to be at my best.

The politicians in Spain don’t know about bike racing, and I have serious doubts about their understanding of capital flows. They’re much more interested in continuing to spend other peoples’ money without hindrance.

Says Evans-Pritchard:

The drip-drip of grim figures came amid fears of a constitutional crisis after the Spanish region of Catalonia requested a €5 billion rescue package yesterday from the central government but refused to accept any political conditions.

There it is in a nutshell: loan us more money so we can keep spending, but without conditions on the loan!

Evans-Pritchard reiterated:

Nothing can happen until Spain requests a loan package and signs a “memorandum” giving up fiscal sovereignty. It remains unclear whether Mr. Rajoy [Spain’s prime minister] will agree to this.

It’s the socialist mindset: only banks and governments can revive the sinking economy. Investors with their own funds in the banks see the lie, and are getting their money out while the getting is good.

Spain is bleeding to death.

Many of the articles on Light from the Right first appeared on either The New American or the McAlvany Intelligence Advisor.

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