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That a default in Europe is coming has never been the
question. For the astute observer the only thing at issue is how and when it
will happen. While the mainstream financial media and government officials
have tried to spin this story as one that involves only Greek debt, the fact
of the matter is that this isn’t isolated to a single country. Italy,
Portugal, Ireland and most other European countries are in exactly the same
boat.
Despite all of the propaganda and machinations from
leading financial powers like the United States, Germany, and France,
it’s should be clear that there is no viable solution to the debt
debacle facing Europe. As such, we should understand that a situation similar
to what led to the Great Depression of the 1930′s is now unfolding once
again. The ability of entire nations to pay off their debt is now in
question, and given the sheer size of the numbers we’re talking about,
any reasonable person could agree that there is simply no plausible
resolution that will make all parties whole again.
This has been playing out in Greece for nearly three
years, and we may very well be just weeks away from the dreaded moment when
it finally becomes official. An exclusive report detailing internal bank
documents from two major Wall Street players says that we may have much less
time than we think as insiders prepare for a financial doomsday next month:
Via The Slog:
A written document giving firm dates and detailed
actions for a planned Greek default has been in the possession of two top
Wall Street bank currency trading bosses since the second week in January. The Slog has separate but corroborative sources
affirming the existence of the document, and a conviction among senior bank
staff that – at least at the time – the plan represented “a
timetable, not a contingency”. The plan gives a firm date of
March 23rd for default to be announced after the close of business.
Senior bankers on Wall Street have been given detailed
documentation setting out a timetable to Greek default, including firm dates
and technical ‘orders’ about last use of the euro as a currency
there. The revelation arrived at Slogger’s Roost last Monday, since
when I have been trying to obtain corroboration. This arrived in the early
hours of today (Thursday). One of the banks is Barclays Capital (Barcap) run by controversial figure Bob Diamond. The
other must remain anonymous for the time being, in order to protect sources.
The document asserts that Greece will officially
be declared in default by all the ratings agencies after the close of
business on Friday march 23rd. At the weekend all Greek bank
accounts will be frozen, with emergency measures detailed to prevent the
flight of capital. Included in the paperwork is a list of very limited
exceptions to the ‘no withdrawals’ order. All major banks
‘are instructed not to deal with euro exchange as of open of business
in Greece on Monday 25th march. All Greek markets will close for one day
‘at least’.
As yet, I have been unable to establish the source
of the documents. But one of my informants admitted, “I have
strongly suggested to Greek business friends and clients that they sell up
fast, do a sale and leaseback on property, empty bank accounts, and change
to a hard currency.”
In testimony before Congress earlier this year
Federal Reserve Chairman Ben
Bernanke warned that a
“disorderly” default would create a “huge amount of
financial volatility globally that would have a very substantial impact not only
on our financial system, but on our economy.” The aforementioned report
indicates that Mr. Bernanke and his counterparts around the world are fully
aware of how bad the situation in Europe really is, and they are trying to
avoid a disorderly default through the implementation of an orderly
contingency plan.
This report also indicates that key players and
insiders know exactly what’s about to happen and they are unloading
positions in financial instruments that stand to collapse once the Greek
default is official, leaving the general public holding the bag.
Europe, as we suggested in Predictions
of a Mad Tin Foiler, is going down, and once that happens the next
phase of this crisis is going to take hold. We’ll likely see massive
outflows of capital from Europe to the United States, which would have an
almost immediate and adverse impact on dollar denominated assets including US
stocks, commodities, and precious metals.
If and when this event happens – because dates
set forth by the powers that be are always subject to change – it will
be a tell-tale sign that a similar collapse in confidence of the US dollar
and US debt instruments will soon follow.
While the sources for the above report are as of yet
unconfirmed, and no copies of it have been made available, if true we will
likely see bits and pieces emerge over coming weeks.
It is and has always been our intention to make our readers
aware of developments that could negatively impact our physical and financial
well being. As we’ve indicated previously, it
is our belief that the first signs of any major man-made event will emerge in
non-mainstream alternative news sources.
This may be one of those signs.
There have been false alarms in the past, and we
won’t deny that this may be one of them. But we’re of the view
that when a smoke alarm goes off, we evacuate first and substantiate it once
we’re out of harm’s way. The alternative is that you end up
trapped in a burning building
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