The big secret is that
the formation of the euro has been largely responsible for the economic
problems seen in many of the euro zone member states. This has obvious
implications for both of the future of the euro as well as the future
composition of the euro zone."
After suffering through nearly five years of a very severe recession,
the worst is yet to come for the Greek people. According to consensus
estimates, it will take twelve years for the Greek economy to regain
its pre-recession output.
Although I view this estimate as generous, it nevertheless represents
an extremely slow recovery when compared to the most adversely affected
nations from previous financial crises. My own estimates indicate that
it will take Greece at least eighteen years to reach its pre-recession
Even if Greece were to begin its recovery later this year, it will have
lost more than 16% of GDP since its pre-recession peak, making it one
of the most severe losses of economic output seen from all financial
crises in the 20th and 21st centuries.
Of course, Greece is not going to begin a recovery in 2012, 2013 or
2014. In fact, by the time the IMF is finished with its austerity measures,
Greece could set a new world record in terms of economic destruction.
So what is the root cause for the implosion of the Greek economy?
Is it due to the nation’s high rate of tax evasion, lack of competitiveness,
its overly generous retirement system and poor labor participation,
as we have all been told by the media and their “expert” sources?
If you believe these are the real reasons for the collapse of Greece,
you may have also been fooled by other myths and lies spread by the
banking cartel and their media friends.
The big secret is that the formation of the euro has been largely responsible
for the economic problems seen in many of the euro zone member states.
This has obvious implications for both of the future of the euro as
well as the future composition of the euro zone.
Numerous economic organizations aligned with the globalization and banking
establishments have even acknowledged that the decline in the current
accounts of South East Area (SEA) countries coincided with their entry
into the European Monetary Union (EMU).
For instance, in a research report published nearly three years ago,
the IMF admitted that just prior to entry into the EMU, several SEA
European nations began to record a current account deficit, reflecting
various economic and infrastructural imbalances within the euro zone.
According to official data from a variety of sources, the current accounts
in seven nations within the SEA have imploded since the mid-1990s. For
instance, in 1994, these nations maintained an overall average current
account balance to an average deficit of 10% in 2008.
In contrast, the picture in Northern Europe (the Northern Euro Area,
NEA) is radically different. When the current accounts of the NEA are
examined, eight nations have accumulated current account surpluses over
the same period.
By the IMF’s own admission, it was the creation of the EMU that drove
the declines in current accounts by allowing countries to maintain their
investment levels above what could be financed from lower domestic saving.
This admission is quite striking considering that the IMF is not only
part of the international banking cartel, but is also a component of
the globalization establishment.
Thus, the adoption of the euro has largely been responsible for the
current economic problems seen in Greece, Italy, Spain, and other nations.
They were doomed from the beginning due to the inherent differences
in each nation’s economic, trade and infrastructural base. These differences
served as inspiration for the formation of the euro as a way for NEA
nations to exploit their SEA counterparts. This is a point that I detailed
more than three years ago.
“One thing is for certain. In order for the union to succeed, all nations
must be provided with a somewhat equivalent infrastructural base. Otherwise,
the disparities in commerce will present problems.
Let me give you a simple example of this. Arguably, Germany has the
most modernized road system in Europe. This enables an efficient means
of transportation for a vibrant consumer and business activity.
In contrast, Greece’s transportation infrastructure is horrendous. As
a result, the cost structure for goods and many services is higher by
necessity. This disparity leads to a relative difference in the strength
of the euro depending on which nation you are in. But there are other
economic uncertainties, such as who will bail out troubled nations.
Given the economic, social and sovereignty issues, it is possible that
by 2020, Germany will pull out of the union, most likely for economic
reasons alone. If that happens, you can bet France will soon follow.”
As the true architects of the EMU, the Jewish banking cartel realized
that the euro would create economic problems for SEA member states.
But they didn’t tell German and French officials. Instead, they promoted
the euro as a gateway to greater economic prosperity for NEA nations
in order to gain support from Germany and France.
The only problem was that the bankers neglected mention of contingent
liabilities that would surface as SEA nations collapsed. Now that the
destructive nature of the EMU is beginning to surface, German and French
officials are second-guessing whether they will remain in the EMU over
the long-term. These discussions have been ongoing for a while now,
but they have not received much media coverage because the most serious
talks have occurred behind the scenes.
There is a very good reason why the U.K. never joined the euro. Hopefully,
by now you realize why.
My guess is that the IMF regrets publishing the research report referred
to in this article because it really blows the lid off of the myths
that the euro would bring economic prosperity for all member states.
Immediately after the euro was launched, Wall Street banks and their
associates in Europe began flooding Greece and other EU member states
vast sums of consumer credit. The idea was to pervert European consumers
to become as irresponsible as those in the U.S. The bankers achieved
this objective in just a few short years.
The timing of this financial bait-and-switch was indeed very convenient
for Wall Street, as it coincided with the collapse of the dotcom bubble
in the U.S. Thus, a refocus on European consumers during the dotcom
recession in the U.S. provided Wall Street parasites and their colleagues
in Europe with new hosts.
In the early stages of the takedown, bankers made enormous sums of money
flooding European nations with consumer and business credit. Now that
many of these nations are economically distressed, the bankers are moving
in to seize a good deal of taxpayer-owned assets using the IMF as its
IMF officials have infiltrated many EU nations, offering to supply each
with finance capital that has come from taxpayers from around the globe.
In return, these nations are required to adhere to very specific criteria
in order to receive new rounds of financing. With each round of financing
comes the promise of further economic destruction.
In short, rather than some humanitarian rescue fund, the IMF serves
as a taxpayer-funded Leveraged-Buyout firm which for some strange reason
is controlled by the international banking cartel. Once a nation agrees
to accept funds from the IMF, it has agreed to allow bankers to reengineer
the entire nation. You can imagine which side stands to benefit and
which stands to lose.
As part of its conditional loan agreements, the IMF has implemented
a very controversial form of austerity which it has used since its formation
decades ago. In fact, the austerity measures utilized by the IMF have
been directly responsible for the much of the demise of the Greek economy
It is a well-known fact that the IMF’s approach to austerity most often
destroys rather than restores economic stability. As history shows,
in almost every situation when the IMF has become involved, it has made
the nation worse off. Many nations are aware of this. Just ask officials
in Brazil, Iceland, Hungary, Argentina, and many other nations what
they think of the IMF. Greece is now learning how the IMF works.
The IMF’s approach to austerity has been structured as a pro-cyclical
fiscal policy, which is designed to tighten the budget. The objective
of this approach is to improve the target nation’s competition by a
reduction in labor costs that is expected to materialize as the result
of internal devaluation of
the economy. In turn, export trade is supposed to become more competitive,
which is expected to help the recovery process. But this cookie-cutter
approach is riddled with numerous flaws.
In most cases when the IMF becomes involved, the pro-cyclical approach
does more harm than good because it has been designed as a solution
to address normal economic contractions. But the IMF only enters the
picture when nations are facing very severe economic problems that extend
beyond those encountered during typical economic contractions. As a
result, the IMF’s pro-cyclical approach actually makes nations worse
off because the “geniuses” at the IMF assume that the economic problems
are cyclical in nature. Clearly, the problems in Greece do not resemble
those seen during a normal economic contraction. Greece is in fact in
a severe depression.
Furthermore, as a way to carry out its globalization agenda, the IMF
disregards the cultural uniqueness of nations it seeks to “assist,”
thereby inflicting lasting socioeconomic and political disruptions.
This points to an entirely different topic of discussion that I may
address in the future.
Overall, the economic approach taken by the IMF is one of privatization.
This leads to a large reduction in government control of the economy.
While some might view this as a good thing, the problem is that government
control of basic goods and services is required in order to prevent
industry collusion and price gouging which is often the result of privatization
in nations with poor regulatory controls. The U.S. offers a good illustration
of this point.
Mike Stathis holds a Master’s of Science in biological chemistry and
biophysics from the University of Pennsylvania and was formerly a National
Science Foundation research fellow at U.C. Berkeley. Mike serves as
the Chief Investment Strategist of AVA Investment Analytics. As the
only expert who predicted the financial apocalypse in detail, Mike has
been a valuable source of guidance for investors, helping them to navigate
the real estate and banking crisis, as well as the resulting global
economic collapse. The accuracy of his predictions has positioned him
as one of America’s most insightful and creative financial experts.
He is the author of America’s Healthcare Solution, The Wall Street Investment
Bible, America’s Financial Apocalypse, Cashing in on the Real Estate
Bubble, America’s Financial Apocalypse, and The Startup Company Bible