I’ve often been labeled as “Gloom and Doom” in the past, but the situation in Europe today is beyond anything I’ve ever seen before. It is highly likely that the EU will not exist in their current form by the end of the year. I realize some of this may sound overly dramatic but the following should give you an idea of how serious things are getting: [Words: 715]
So says Graham Summers (www.gainspainscapital.com) in edited excerpts from his original article*.
Lorimer Wilson, editor of www.munKNEE.com (Your Key to Making Money!), has edited the article below for length and clarity – see Editor’s Note at the bottom of the page. This paragraph must be included in any article re-posting to avoid copyright infringement.
Summers goes on to say, in part:
1. Germany and France have introduced a joint proposal to allow Schengen-zone countries to temporarily reintroduce border controls as a means of last resort might sound harmless but doing so would damage one of the strongest symbols of European unity and perhaps even contribute to the EU’s demise…. [Source]
The above story has been almost completely ignored by the mainstream media. Let me ask you this: do you think Germany and France are really concerned about an influx of migrants? Of course not, the whole idea is ridiculous….No, the move to create border controls is about one thing only: stopping people from fleeing with their money when the collapse comes. The political elite in Europe are watching the bank runs in Spain and Greece and know that when the big Crash comes similar runs will occur throughout the EU.
Consider the following, more recent stories and you’ll see what I mean:
2. European finance officials have discussed, as a worst-case scenario, limiting the size of withdrawals from ATM machines, imposing border checks and introducing capital controls in at least Greece should Athens decide to leave the euro…[and] the possibility of suspending the Schengen agreement, which allows for visa-free travel among 26 countries, including most of the European Union. [Source]
3. The Swiss National Bank is considering imposing capital controls on foreign deposits if Greece leaves the euro, as the franc would come under heavy demand from investors seeking a haven in Europe. [Source]
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The above is not Gloom and Doom! The above is reality. Talks are already underway! Moreover, the fact that these stories are even making it to the media tells us point blank that the political leaders in Europe are absolutely terrified by the situation they have on their hands.
4. Indeed, the UK is implementing numerous contingency plans ranging from implementing border controls to literally preparing to help thousands of British expats flee the Eurozone should the banking system collapse and Brits around the EU find themselves without access to cash.
Speaking of which, here’s another story the media has been downplaying:
5. Stephen Hester, the chief executive of Natwest, owner the Royal Bank of Scotland,…said in a confidential message – a copy of which was seen by The Sunday Telegraph [see here] – over the disruption to 12 million business and personal customer accounts of both RBS and its subsidiary, “Behind the scenes, we are making progress on our task to clear the backlog of payments.” That is correct, 12 million RBS customers have been shut out of their accounts and ATM withdrawals for SIX days due to a “glitch.” REALLY?
Let’s be blunt, the EU banking system is a $46 trillion toxic sewer filled with PIIGS debt. Even the ECB’s is not immune to this mess: over a quarter of its balance sheet is comprised of this garbage. This is why the ECB freaked out and pumped so much money into the EU banking system. You don’t spend over $1 trillion in nine months unless something very very bad is coming down the pike.
The fact countries are now actively putting together contingency plans to get their citizens out of EU should give you an idea of how fragile the entire system is over there. Yes, they political leaders will try to float various ideas on how they’ll “solve” the problems, but the reality is that there simply isn’t enough capital available to prop up the system and the market is starting to realize this (see the yields on Italian and Spanish bonds as well as those countries respective CDS) so if you’re not already taking steps to prepare for the coming collapse of the EU, you need to do so now.
We have at most a few months and possibly just a few weeks before the EU Crisis comes to a head.
*http://gainspainscapital.com/?p=1838 (To access the above article please copy the URL and paste it into your browser.)
Editor’s Note: The above article may have been edited ([ ]), abridged (…), and reformatted (including the title, some sub-titles and bold/italics emphases) for the sake of clarity and brevity to ensure a fast and easy read. The article’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article.
As many of you know, my primary forecast regarding Europe is that the EU will be broken up and/or collapse within the coming months. The reasons for this are financial, monetary and political in nature [with much of the latter dependant on what happens in Germany. Let me explain.] Words: 516
The European economic situation is explained very simply in the illustration below. Take a look.
Europe is heading into a full-scale disaster [because,] you see, the debt problems in Europe are not simply related to Greece. They are SYSTEMIC. The European banking system’s leverage levels alone position Europe for a full-scale banking collapse on par with Lehman Brothers. Again, I’m talking about Europe’s ENTIRE banking system collapsing. This is not a question of “if,” it is a question of “when” and it will very likely happen before the end of 2012. Words: 750
Follow the eurozone crisis as it unfolds with this quick guide to key dates, developments, and investment implications.
As the focus of the euro crisis shifts to Italy, IMF head Christine Lagarde has warned that European leaders have less than three months to save the euro. Meanwhile top economist Nouriel Roubini has called on Berlin to drop its obsession with austerity, proposing that the German government give every household a 1,000 euro [$1,250 US equivalent] voucher to spend on a vacation in Southern Europe. Words: 990
The Markit PMI data from Europe shows still more deterioration led by France, Italy, and Spain. Let’s take a look at a few countries.
In every economic crisis there comes a moment of clarity. In Europe soon, millions of people will wake up to realize that the euro-as-we-know-it is gone. Economic chaos awaits them. [Let us explain why that is the case and how it will come about.] Words: 680
The media is rife with misrepresentations and analysis of the EU. Here’s the real deal, no BS situation with Europe – and its BAD! Words: 900
Introduction: “The crisis in the eurozone is the result of France’s persistent pursuit of the “European project,” the goal of political unification that began after World War II [with the hope] that a political union, a United States of Europe similar to America’s, would…prevent the types of conflict that had caused three major European wars…[and] also make Europe a power comparable to the United States, and thereby give France, with its sophisticated foreign service, an important role in European and world affairs.” [What went wrong and what does the future hold?]
Worries about an economic catastrophe in Europe are heating up again, and dramatic forecasts about doom are popping up everywhere. What’s important? How did we get here? Let’s put this all in perspective. Words: 2356
We still don’t have many political voices [in the European Union] that have the courage to say, ‘We’re headed for the rocks, and before we hit the rocks, let’s take a different course. Let’s try to break this thing up peaceably, before it ends in disaster….The establishment always supports the status quo…but actually, I think the only way we can avoid a depression is to break this (the EU) up.
I continue to see articles in the media claiming that Europe’s problems are solved. Either the folks writing these articles can’t do simple math, or they don’t bother actually reading any of the political news coming out of Europe [so let me present 3 data points that guarantee Europe will collapse at some point in the near future]. Words: 722
Europe may soon be choking on that plat du jour of government a la Hollandaise with the side of chopped Greek salad. The whole world, in fact, has got something like a giant hairball stuck in its craw. The hairball is composed of filaments of lies wound over a core of supernatural indebtedness. The lies are promises that the debt will be paid back. Words: 710
Europe is heading off a cliff! From one end of the continent to the other, the numbers suggest a double-dip recession is striking with brutal force…and with the world as interconnected as it is these days, what happens in Europe WILL impact our companies and markets here so now is the time to position your portfolio to weather the storm. Words: 900
Americans, don’t think for one moment that the crises in Europe are irrelevant! This past April the U.S had the largest monthly decline in exports to Europe in the past 7.5 years and this trend will only get worse – much worse – as the crises spread and linger. Exports to Europe are now down 2.7% from April 2011, the first yearly decline since February 2010. The chart below says it all.