King World News (Link)
- Eric King (July 28, 2011)
With fear escalating around the financial world as the US
debt ceiling deadline draws near, today King World News interviewed Jim Rickards
to get his take on where things stand. One of the things KWN was surprised to
learn was that while everyone has been focused on the US�s debt problem, the
Germans with the cooperation of their political and financial foot soldiers have
essentially conquered Europe.
Jim Rickards explains this extraordinary conquest,
�It became more and more clear that there was no good way
out, in other words you could just have an outright Greek default, which
would be highly disruptive or Greece could have left the Euro and that�s
another bad outcome. Not so much economically, but politically, Germany and
France don�t want that because it would lead to the unraveling of the entire
Euro project which has been going on since the early �50s.�
�So finally Germany did what everyone thought they would
have to do at the end of the day, they stepped up and they have created this
new facility (European Financial Security Facility or ESFS). But they have
given it (the facility) vast new powers...In Europe for over ten years
you�ve had the European Central Bank, which is the equivalent of the Fed,
but they did not have the equivalent of a Euro Treasury.
So the best way to understand the ESFS, for the first
time we have a European-wide Ministry of Finance. They don�t call it that,
but that�s what it is, and it�s run by the Germans. So in effect Germany
will be dictating fiscal policy to all of the Euro system from here on out.
I think that�s what the Greeks haven�t realized at this point.
They (the Greeks) like the fact that their banks are
being propped up, they like the fact that the austerity budget is not going
to be as bad as it was. I think in the short run this is very positive for
Greece because they won�t have quite the austerity straight-jacket that they
would have otherwise been wearing. It�s probably a positive for Greek growth
and it�s less disruptive to the market, so that�s the good news.
The bad news at least if you�re Greece or Italy or Spain
or Portugal is that from now on your fiscal policy is going to be dictated
by Germany. So this is what I call the financial �Fourth Reich�. Germany has
accomplished financially what it has never been able to do militarily since
the days of the Holy Roman Empire, which is to basically gain control over
How will the Fourth Reich rule Europe? That remains to be
seen, but if history is any indication it will be with what the Germans would
consider to be coercive efficiency.
Jim Rickards also discusses the gold market in great detail
including how the outcome of the debt ceiling issue will influence gold prices
and much more.
The KWN audio interview with Jim Rickards is available now
and you can listen to it by
CLICKING HERE. �
Economic Crisis ~
Europe ~ New World Order