Bailout, Bailins, and the Greeks' Trojan Horse

Istanbul Archeological Museum Trojan Horse (Wikipedia)

While Americans are eagerly signing petitions to ban the American flag on the heels of Louis Farrakhan’s Nation of Islam leader call to ban the Stars and Stripes “due to its links to racism” or are busily banning anything attached in any way to the Confederate flag and our history, the United States and the world are in serious financial trouble driven by out-of-control debt, particularly the most visible nation of all, Greece.

Healthcare for illegals, gay marriage, and other non-stop crises occupy the American overwhelmed minds, while the Trojan Horse of huge national debt and loss of sovereignty to the globalist Transpacific Partnership (TPP) mystery “committee” are ignored.

Greece is bringing to the forefront the issue of debt, what happens when it spends 60 percent of GDP, lives from borrowed billions, and refuses to curtail spending on entitlements, expecting more bailouts from the EU, essentially Germany.

Banks and the stock exchange are closed for the week, issuing a 60 euros limit per withdrawal. Not unexpectedly the euro fell against the dollar and the British pound. Sky News reported Prime Minister Tsipras as blaming the European partners and the European Central Bank for the debacle because creditors “have refused a request to extend Greece’s international bailout beyond Tuesday, until after the referendum.” The move risks a Greek default on 1.5 billion euros payment to the International Monetary Fund.

Tsipras claims that the bank deposits of the Greek people are fully secure and the payments of wages and pensions are guaranteed. I am not so sure that is the case since Greece is carrying a government debt load of over 175 percent of its GDP.  Countries cannot service such level of debt without printing money. http://www.tradingeconomics.com/greece/government-debt-to-gdp

The European Central Bank will maintain its “emergency cash lifeline to Greece’s banks” without an increase. The Emergency Liquidity Assistance (ELA) on which Greek banks depend, if lowered, may force the country out of the Eurozone.

There were many economists, of course, who questioned the wisdom of accepting Portugal, Italy, Greece, and Spain into the EU because their monetary policies were plagued by high inflation. Others believe that a return to the drachma may not be such a bad idea.

Expecting the worse after banks announced closings, Greeks stood in long lines to withdraw cash from ATMs and many horded gasoline and food. After five years of various bailouts, demonstrations, protests, refusals to adopt more austerity measures, negotiations between the leftist government of Prime Minister Alexis Tsipras and Brussels creditors have broken down. For months economists have predicted Greece’s pull out from the Eurozone.

In preparation for the national referendum on July 5, police patrols are more visible especially around ATMs. Tsipras asked voters for a “yes” or “no” vote on the bailout proposal considered by his government as confiscatory. The plan would “raise taxes and hurt pensioners,” forcing Greeks to “an endless cycle of austerity.” But the Greeks have been told few details of the deal – nobody really knows the implications of a “yes” vote or a “no” vote and everyone fears they “would become Venezuela.”

But the well-off Greeks, fearing the election of the leftist Syriza, have already moved money out of Greece or took cash out and stored it elsewhere.

The Tsipras government favors a “no” response to the referendum because the bailouts terms are “humiliating” and would deepen Greece’s economic recession. But without bailouts, “most Greek banks would have totally collapsed by now.” http://www.dailymail.co.uk/article-3141480/Hundreds-queue-outside-banks-fears-Grexit-grow-ahead-MPs-vote-bailout-referendum.html

It has been reported that withdrawals of 500-600 million euros have emptied more than 2,000 ATMs.  When the austerity referendum was announced, people started withdrawing money. When the Greek banks reopen, would they need bail-ins like the Cypriot banks? Would the depositors be forced to accept worthless I.O.U.s for their cash?

The European Union has required its member countries to enact bail-in legislation. Bail-ins force creditors and shareholders to rescue troubled banks. Cyprus citizens holding private bank accounts had to take “haircuts,” a form of wealth confiscation. Private pension funds were raided in Poland. http://www.dcclothesline.com/2013/09/25/cyprus-style-wealth-confiscation-is-now-starting-to-happen-all-over-the-globe/

Bailouts forced taxpayers to financially rescue big banks that had engaged in risky financial activity, using the infamous “too big to fail” excuse.

How much longer can Germany sustain the very shaky European Union? Should they bring back their own currency, the Deutsche Mark? As more large deposits and capital leave Greece when banks reopen, corporate asset controls may emerge. The Greek market may be shocked and defaults of various debt instruments may emerge.

A Romanian friend, Florina, explained the Greek crisis in terms that most people can understand. “I loaned money to a family in a time of financial crisis so that they can survive, and the family did not curtail their spending, they blew the money on unnecessary stuff; now the family is holding a meeting to vote if they are going to pay me back or not. That’s Greece now.”

 

 

My radio chat with Silvio on April 20, 2015 on National Blogtalk Radio

Topics: Greece, confiscation of Social Security, and income inequality
http://blogtalk.vo.llnwd.net/o23/show/7/532/show_7532915.mp3

The Antikythera Mechanism, the First Analog Computer

Antikythera Mechanism computer-generated
Source: Wikipedia

The advanced computer age has conditioned us to take for granted all the electronic devices surrounding us that bring us instantaneous access to our friends and family, and eliminates the need for the NSA to do any field work to find out everything they ever want to know about us.

Anonymity has disappeared. Thanks to developments in the second half of the twentieth century and the beginning of the twenty-first century, we are now in the age of nanotechnology. Computers have changed in size from an entire building to the size of a credit card and even smaller.

I was very surprised to find out that we had an analog computer in 87 B.C. made of bronze. Captain Demetrios Condos sent his bored crew around the Antikythera Island to dive for sponges shortly before Easter 1900. His boat had been driven off course an entire week by gale winds off the Island of Crete into the calmer waters of the northern tip of Antikythera Island, Greece.

The most exceptional seaman, Elias Stadiatis, dove to 140 feet, aided by lead weights attached to his diving boots. He yanked the rope to be pulled up and, instead of bringing up sponges, he told Captain Condos about “naked women and horses” he saw on the bottom.  The next dive revealed a shipwreck dating back to 80 B.C. Treasures and statues were scattered and plainly visible on the sea floor. The shipwreck find was so exciting! The happy sailors were imagining a treasure trove of gold coins and jewels.

When the salvage operation finally commenced in November 1900, the difficult and dangerous work lasted nine months. Dangerous weather conditions and primitive techniques made scuba-diving so precarious and perilous that one deep-sea diver died and two were seriously hurt.  

Among the treasure trove found in the Mediterranean and later housed at the National Archeological Museum in Athens, an archeologist named Valerios Stais discovered one single encrusted bronze mechanism  in a pile of discarded debris and marble pieces. It appeared to be a clock of sorts.

Fractured later into three pieces, the mechanism lost smaller pieces later during handling and cleaning. Since the initial find, 82 fragments have been discovered by subsequent expeditions, including that of Jacques Cousteau. Seven fragments are actually significant because they contain the mechanism’s gears and inscriptions in Koine Greek.

Valerios Stais announced in 1902 that his find, half the size of a portable typewriter at that time, was an ancient Greek astronomical device. Some thought it was an astrolabe, a tool used by navigators to measure angles of distances between planets and stars above the horizon. Others thought it was a planetarium.  Some believed the mechanism was too complex to be either one and must have been “created by aliens from outer space.”

Professor Derek de Dolla Price of Yale concluded that it was a computer made in 87 B.C. comprised of 30 bronze gears to calculate the movement of the Sun, Moon, and planets. Professor Price described the discovery as “finding a jet plane in King Tutankhamun’s tomb!”

The Antikythera Mechanism, also called the Rhodes calculator, “the forerunner of the computer age” was described as the “wheeled computer of the heavens.” It mathematically calculated the movements of planets and celestial bodies during a period of time when humanity believed that the Earth was a disc floating on a great ocean with the sky above like a bowl. “The planets and the Moon were thought to move along certain geometrical paths.” The mechanism was to calculate and determine the celestial bodies’ exact movement, making further calculations unnecessary.

In 1976 Jacques Cousteau and his crew found coins at the wreck site dating between 76-67 B.C. Cousteau’s coins may point the origin of the mechanism to the city of Pergamon.

Because the mechanism was so complex, The Antikythera Mechanism Research Project concluded in the late 2000s that it was probably made in the Corinth colonies of ancient Greece such as Syracuse.

The Rhodian style vases may point to the city of Rhodes. Rhodes was a center of astronomy and mechanical engineering and home to Hipparchus with his theory of the motion of the Moon.

Michael Edmonds of Cardiff University described the mechanism in 2006 as “more valuable than the Mona Lisa” because the astronomy was correct.

Carman and Evans, in their 2014 study dated the mechanism to 200 B.C. and attributed it to the Babylonians. If that is so, why is the inscription in Koine Greek?

A new expedition is planned for spring 2015 by the Hellenistic Ministry of Culture and Sports. They are hoping to find new parts of the Antikythera Mechanism.

Austerity, Sub-Prime Lending, and the Safety of Savings Accounts

“It is hard to imagine a more stupid or more dangerous way of making decisions by putting those decisions in the hands of people who pay no price for being wrong.” – Thomas Sowell

Austerity has not worked well in the EU if you ask Keynesian economists and supporters; they will tell you that austerity does not work, citing the EU experience. Italy, Greece, Portugal, Spain, and the U.K. governments claimed that austerity measures resulted in stratospheric unemployment rates and slow economic growth.

Jeffrey Dorfman, using data from Eurostat, the official statistics agency of the European Union, and calculating government spending in EU countries between 2008-2012, found that only eight of the 30 countries listed have actually reduced government spending (austerity), most prominently Iceland and Ireland. The elected officials responded to rallies, protests, sit-ins and strikes, by spending more money to appease the masses.  Dorfman reported that the average spending increase has been 4.9 percent, with Greece at 8.3 percent, Spain at 13.3 percent, and Portugal at 5.8 percent. In European countries which have reduced government spending, Iceland, Ireland, Bulgaria, Latvia, Lithuania, Hungary, Poland, and Romania, their specific austerity measures have worked. Dorfman concluded, “Austerity cannot have failed in countries where it was never tried.” http://www.forbes.com/sites/jeffreydorfman/2013/08/01/austerity-in-europe-it-will-work-if-its-ever-tried/

As far as Greece is concerned, President Obama, following his meeting with the Prime Minister Samaras, downplayed austerity measures. “We cannot simply look to austerity as a strategy. It’s important that we have a plan for fiscal consolidation to manage the debt, but it’s also important that growth and jobs are our focus.” Not to be outdone, Samaras blamed Greece’s economic problems on illegal immigration, “I believe that the problems have to do with illegal immigration, internal turbulence in various countries, and even, unfortunately, the problem of terrorism.” According to Craig Bannister, Samaras called for the U.S. and Europe to “liberalize” their economic potential. http://cnsnews.com/mrctv-blog/craig-bannister/ironies-abound-comments-obama-and-greek-prime-minister

The EU countries continue to be prisoners of the Euro, the common currency of 27 countries that gave up their monetary policy making powers to Brussels and no longer have the luxury to print their own money to extricate themselves from over the top government spending.

The Cyprus lawmakers were confiscatorily creative with their citizens’ money deposited with the Bank of Cyprus. Lawmakers agreed to receive a 13 billion euro loan from the European Commission, the International Monetary Fund, and the European Central Bank, dubbed the Troika, to bail out Cypriot banks that engaged in poor betting on Greek sovereign debt.

According to Robert Romano, the loan represented 20 percent of Cyprus’ 66.8 billion euro in deposits. Depositors were levied (confiscated) 37.5 percent of savings, with another 22.5 percent confiscation at a later date, in exchange for shares in the Bank of Cyprus. Depositors did not want shares in the Bank of Cyprus that acted so irresponsibly in its financial dealings but had no choice but to accept. http://netrightdaily.com/2013/05/cyprus-lawmakers-finally-agree-to-steal-17-1-billion-of-savings-deposits/

John Kemp said, “Bailing-in depositors with banks in Cyprus is a serious policy error that will destabilize the European banking system and threatens to accelerate bank runs in future.”

http://www.reuters.com/article/2013/03/18/us-column-kemp-cyprus-bailout-idUSBRE92H0CT20130318

Jose Manuel Barosso, current President of the European Commission, Herman van Rompuy, President of the European Council, and Dalia Grybauskaite, President of Lithuania, unveiled on August 1, 2013, the new EU plan to deal with the possibility of a bank collapse. 

The German Economic News (Deutsche Wirtschafts Nachrichten) reported on August 7, 2013 that, under this plan, if a bank goes bankrupt, small depositors can only get their money out of the bank after 20 working days, withdrawing in the interim only 100-200 euros per day. The limit on daily withdrawals “may last up to three weeks.” Depositors with accounts larger than 100,000 euros can withdraw their money in full in five days. The EU Council President, Herman von Rompuy, had proposed to let savers wait 4 weeks for their money. http://deutsche-wirtschafts-nachrichten.de/2013/08/07/neue-eu-regel-sparer-muessen-um-guthaben-unter-100-000-euro-bangen/

The article, “Neue EU-Regel: Sparer müssen um Guthaben unter 100.000 Euro bangen” (New EU Rule: Savers must fear credit under 100,000 euros) warned people who were planning on making major purchases, ran a business, the elderly with big medical expenses, or those who liked to have cash available.

The agreement did not address the contribution of banks into the EU deposit insurance. It is easy to see why Europeans who are informed are spooked about this new infringement into their right to keep the money they’ve earned.

According to John Ward, the new banking rules were implemented “to help protect the taxpayer and move the burden of bailing out the banks onto shareholders and junior debt holders.” It is evident that the junior debt holders would be the depositors who saved their money for a rainy day. Ward calls it “global looting.”

Meanwhile, across the Atlantic, President Obama’s Residential Mortgage Backed Securities Working Group (set up last year) is going after “prosecutions of fraudulent underwriting activity by banks that contributed to the financial crisis.” Criminal investigations of ‘too big to fail banks’ include JP Morgan Chase and Co. and Bank of America who allegedly “failed to disclose risks embedded in $850 million in mortgage-backed securities issued in 2008.”

New York Attorney General, Eric Schneiderman, the co-chair of the Working Group, pointed out the “efforts to hold banks accountable for the crash of the housing market and the collapse of the American economy” five years after the fact.  (Greg Farrell, Phil Mattingly, and Karen Gullo, Moneynews, August 9, 2013)

When Fannie Mae and Freddie Mac required bailouts after the housing market crash, Fannie and Freddie were bought by the Treasury for $188 billion and the FDIC (a private insurance corporation that insures ‘each depositor to at least $250,000 per insured bank’) absorbed the losses of smaller failed banks.  The biggest banks were bailed out by the Treasury and the Federal Reserve System.

President Obama’s Mortgage Initiative’s goal is to get banks to use depositor and investor funds to write 30-year fixed-rate mortgages at affordable rates, assuming the risks the government now bears. According to Peter Morici, the President “won’t admit that in today’s economy mortgages are simply too risky for private investors” who are unwilling to lend to people with less than stellar credit. (Peter Morici, The Hidden Agenda Behind Obama’s Mortgage Initiative, August 9, 2013)

This leaves the possibility of retirement accounts confiscation to solve any financial crisis the government may encounter. Experts agree that there are at least $19.5 trillion in retirement accounts. Some argue that Executive Order 13603, National Defense Resources Preparedness, signed on March 16, 2012, provides the opportunity, the authority, and the framework to allocate any resources, if a national emergency is declared. This executive order gives the President power to allocate commodities, all forms of energy, civil transportation, usable water from all sources, health resources, labor such as military conscription, and “federal officials can issue regulations to prioritize and allocate resources.” Allocation could include savings as a resource since the definition of national emergency is very vague.

Sen. Phil Gramm (R-Texas) wrote in The Wall Street Journal that presidential candidate Bill Clinton suggested in 1992 to use “private pension funds to ‘invest’ in government priorities, such as affordable housing, to generate long-term, broad-based economic benefits.” Gramm continued that Clinton’s radical proposal eventually led to the sub-prime mortgage disaster. “Seldom has such a radical proposal been so ignored during a campaign only to later lead to such devastation consequence,” the financial crisis of 2008, the result of “a lot of banks making a lot of loans to a lot of people who either could not or would not pay the money back.” There is plenty of additional blame for the greedy and unscrupulous brokers and realtors who knew they were selling homes to people who did not qualify for a loan and to the Americans who sought the loans they knew they could ill-afford. http://online.wsj.com/article/SB10001424127887323477604579000571334113350.html

Could holding money into retirement accounts be deemed “hoarding?” President Franklin D. Roosevelt signed Executive Order 6102 on April 5, 1933, “forbidding the Hoarding of gold coin, gold bullion, and gold certificates within the continental United States.

Roosevelt’s order criminalized the possession of monetary gold by any individual, partnership, association, or corporation” under the excuse of hard times. Artists, jewelers, owners of rare collections, and dentists were exempt. Violations of the order were punishable by fines up to $10,000. The Executive Order 6102 was revoked and superseded by Executive Orders 6260 and 6261 of August 28 and 29, 1933 but the confiscation had already taken place.

Because the price of gold for international transactions was set by the Treasury at $35 per ounce, everyone who was forced to surrender personal gold incurred an immediate loss. The government profit which resulted from this confiscation of gold funded the Exchange Stabilization Fund under the Gold Reserve Act of 1934.

Woodrow Wilson’s Executive Order 2697 passed on September 7, 1917, gave the Federal Reserve Bank and the Secretary of the Treasury the authority to regulate the exportation of coin, bullion, and currency, and the Federal Reserve Bank to make decisions whether such exportation is “compatible with the public interest.” How is the “public interest” decided and where does it stop?

How safe is your money? Considering the massive redistribution of wealth in the last five years, the loss of value of savings and pension funds due to low interest rates and the deliberate devaluation of the dollar following endless quantitative easings by Bernanke and the Fed, the picture is not very rosy. The Stock Market is doing well (15,000 level); the Fed purchase of $85 billion worth of bonds every month is artificially propping up the stock market and does not reflect the actual economy.

 

Friday Radio Chat with Silvio Canto Jr. of Dallas

http://www.blogtalkradio.com/cantotalk/2012/05/11/our-friday-chat-with-dr-ileana-johnson-paugh

The Unsolicited Opinion April 12, 2012

http://theunsolicitedopinion.com/audio/USO-04-12-12.mp3

My radio commentary on Republic Broadcasting Network. I come on in the second hour.
Topics: European Union, Greece, Obamacare, food supply, ethanol.