13 Feb 2012

A Greek Tragedy : Act 2

So the Greek parliament has approved the latest bail-out deal. They get 130 billion euros from the IMF and the ECB and a 100 billion "haircut" of their debts in return for massive austerity. But for me, the most revealing news was that the Germans were insisting that the 130 billion be kept on a separate account that would be used to pay off the interest payments on national debt!

In other words, this deal is not to help the Greeks at all. It's just a way of making sure that the bankers can get to suck the life blood out of the Greek economy before moving on to the next countries on the list - Italy, Spain, Portugal, France.....

OK. They've agreed to accept a 100 billion "haircut". But given that the markets are currently charging the Greek government 25.91% interest, they will do ok anyway. I presume that the Germans intend to block the 130 billion on a separate account to make sure that the markets really do get paid their 25.91% of interest. And don't forget that much of the "money" lent to the Greeks was not money that the banks had to lend anyway.

The situation is a total disaster. And I still cannot believe that no-one is talking about the other option of using the ECB to provide the money needed to get Greece off the hook. The mechanism is there! It just needs a single "publicly-owned credit institution" to act as intermediary, and the 340 billion needed to pay off the entire national debt could be provided on the 29th of Feburary.

The fact that no-one has even mentioned this option can only be explained one way.

If any country were to pay off its debts to the banking sector, everyone would suddenly realise that we have been all ripped off for decades by banks who create money out of thin air, lend it to governments, and then sit back and wait for the taxpayers to pay them interest - 4.3 trillion euros for the eurozone between 1995 and 2010.

We have to stop this insanity now. Otherwise, we will be next on the list.

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