Bailout in the Works? Obama MeetsUnelected EU Bureaucrats

Bailout in the Works? Obama Meets Unelected EU Bureaucrats Kurt Nimmo Infowars.com November 28, 2011 Obama met today with unelected bureaucrats of the European Union to discuss the eurozone debt crisis.

European Council President Herman Van Rompuy and European Commission President Jose Manuel Barroso attended a meeting held at the White House.

No European heads of state were in attendance, despite earlier conversations between Obama and German Chancellor Angela Merkel and French President Nicolas Sarkozy. Secretary of State Clinton and Treasury boss Timothy Geithner were present.

EU Slavery: Media hiding truth about debt crisis http://www.youtube.com/watch?v=Gvgae3re58s 1. Reuters reports Van Rompuy and Barroso will “face tough questions… on how much longer the crisis might go on.”

Obama has said resolving the crisis will require “some tough decisions” in Europe, but he has not specified what the decisions might entail.

“I am deeply concerned and I have been deeply concerned. I suspect I will be deeply concerned tomorrow and next week,” Obama said when asked about his reaction to the crisis in the eurozone during a visit to Australia earlier this month.

Analysts in the U.S. predict the Federal Reserve will offer discounted rates to the Europeans in much the same way it did in the financial crisis of 2008. “This is because if EU countries are unable to maintain their current level of accounting for approximately 20% of United States exports, the weak

economic recovery in the United States is threatened,” states a InvestTechFX press release.

1. Ambrose Evans-Pritchard, writing for the Telegraph today, asks if the Fed should pose as a knight in white shining armor. “So the question arises, should the rest of the world take over management of Europe to prevent or mitigate disaster? Specifically, should the US Federal Reserve assume leadership as a monetary superpower and impose policy on a paralyzed ECB, acting as a global lender of last resort?”

The Federal Reserve believes it the authority to do this. “The Fed can inject money into the economy in still other ways. For example, the Fed has the authority to buy foreign government debt. Potentially, this class of assets offers huge scope for Fed operations,” Ben Bernanke said in a 2002 speech.

It also presents a unique opportunity for the bankers who own the cartel masquerading as a federal agency to extend their reach and consolidate power. Best of all, for the bankers, is the prospect that the beleaguered American taxpayer will once again pick up the tab.

We now understand the full magnitude of the fleecing. According to a Bloomberg report released today, the banksters grabbed an estimated $13 billion in loot by taking advantage of the Fed’s below-market rates. “Saved by the bailout, bankers lobbied against government regulations, a job made easier by the Fed, which never disclosed the details of the rescue to lawmakers even as Congress doled out more money and debated new rules aimed at preventing the next collapse,” write Bob Ivry, Bradley Keoun and Phil Kuntz for Bloomberg.

Crisis Exploited to Implement Supranational Authority Barroso said last week that remedial eurozone bonds might be released following the implementation of new budget laws.

The European Commission has introduced draconian legislation that would allow the EU to “review” the national budgets of eurozone countries.

The law would allow “heavy surveillance of policies of a country either already getting emergency financial aid from the euro zone or facing serious financial instability,”

Reuters reported last week.

The EC stressed that “stability bonds” would not be introduced to address the debt crisis until it is allowed to impose “budgetary discipline” on member states.

Merkel and Sarkozy are behind the push to strip member of states of their national sovereignty and allow an unelected EU bureaucracy to make budgetary decisions.

“Germany and France stepped up a drive on Monday for coercive powers to reject national budgets in the eurozone that breach EU rules, as a market rout of European debt eased temporarily on hopes of outside help for Italy and Spain,” the Financial Post writes today, describing the intervention as “some sort of IMF program.”

Should the Fed save Europe from disaster?

By 1. Ambrose Evans-Pritchard The dam is breaking in Europe. Interbank lending has seized up. Much of the financial system is paralysed, setting off a credit crunch just as Euroland slides back into slump.

The Euribor/OIS spread or`fear gauge’ is flashing red warning signals. Dollar funding costs in Europe have spiked to Lehman-crisis levels, leaving lenders struggling frantically to cover their $2 trillion (£1.3 trillion) funding gap.

America’s money markets are no longer willing to lend to over-leveraged Euroland banks, or only on drastically short maturities below seven days. Exposure to French banks has been slashed by 69pc since May. Italy faces a “sudden stop” in funding, forced to pay 6.5pc on Friday for six-month money,

despite the technocrat take-over in Rome.

German Bund yields have risen to 59 basis points above Swedish bonds since Wednesday’s failed auction. German debt has been relegated suddenly against Swiss, Nordic, Japanese, and US debt. As the Telegraph reported two weeks ago, Asian central banks and sovereign wealth funds are spurning all EMU bonds because they have lost confidence in a monetary system with no lender of last resort, coherent form of government, or respect for the rule of law.

Even if EU leaders could agree on fiscal union and joint debt issuance – which they can’t – such long-range changes cannot solve the immediate crisis at hand. The push for treaty changes has become a vast distraction.

Unless Germany agrees to the full mobilization of the European Central Bank very fast, the eurozone will spiral out of control. As The Economist put it, “The risk that the currency disintegrates within weeks is alarmingly high.”

Theoretically, EMU can limp on though the Winter until the Italian debt auctions of €33bn in the last week of January, and €48bn in the last week of February. The reality is that sovereign contagion to the financial system may well bring matters to a head more swiftly.

If break-up occurs in a disorderly fashion, with Club Med states and Ireland spun into oblivion one by one, the chain reaction will cause an implosion of Europe’s €31 trillion banking nexus (S&P estimate), the world’s biggest and most leveraged. This in turn risks an almighty global crash – first class passengers included.

So the question arises, should the rest of the world take over management of Europe to prevent or mitigate disaster? Specifically, should the US Federal Reserve assume leadership as a monetary superpower and impose policy on a paralyzed ECB, acting as a global lender of last resort?

In essence, the US would do for EMU what it did in military and strategic terms for the Europe in the 1990s when Washington said enough is enough after squabbling EU leaders had allowed 200,000 people to be slaughtered in the Balkans. The Pentagon settled matters swiftly with “Operation Deliberate Force”, raining Tomahawk missiles on the Serb positions. Power met greater power.

Personally, I have not made up my mind about the wisdom of a Fed rescue. It is fraught with dangers, and one might argue that resources are better deployed breaking EMU into workable halves with minimal possible damage.

However, debate is already joined – and wheels are turning in Washington policy basements – so let me throw this out for readers to chew over.

Nobel economist Myron Scholes first floated the idea over lunch at a Riksbank forum in August.

"I wonder whether Bernanke might not say that `we believe in a harmonized world, that the Europeans are our friends, and we know that the ECB can't print money to buy bonds because the Germans won't let them. And since the ECB will soon run out of money, we will step in and start buying European government bonds for them'.

It is something to think about," he said.

This is not as eccentric as it sounds.

The Fed’s Ben Bernanke touched on the theme in a speech in November 2002 – “Deflation: making sure it doesn't happen here” – now viewed as his policy `road map' in extremis.

"The Fed can inject money into the economy in still other ways. For example, the Fed has the authority to buy foreign government debt. Potentially, this class of assets offers huge scope for Fed operations," he said.

Berkeley’s Brad DeLong said it is time for Bernanke to act on this as the world lurches straight into 1931 and a Great Depression II. “The Federal Reserve needs to buy up every single European bond owned by every single American financial institution for cash,” he said.

The Fed could buy €2 trillion of EMU debt or more, intervening with crushing power. The credible threat of such action by the world’s paramount monetary force might alone bring Italian and Spanish yields back down below 5pc, before one bent nickel is even spent.

One presumes that the Fed would purchase both the triple AAA core and Club Med in a symmetric blast of monetary stimulus across the board, avoiding the (fiscal) error of targeting semi-solvent states. In sense, the Fed would do quantitative easing for the Europeans, whether they liked it or not.

David Zervos from Jefferies has proposed an extreme variant of this, accusing Germany’s fiscal Puritans of reducing Europe’s periphery to “indentured servants” and driving the whole region into depression with combined fiscal and monetary contraction.

“We in the US need to snuff out these sadofiscalists and fast, they are a danger to the world. The US can force monetisation at the ECB. We should back up the forklift and buy

Euro area bonds. Lots of them,” he said.

Some of the purchases could be achieved by tapping the Fed’s euro account at the ECB, flush with funds as a result of currency swaps provided by Washington to help Europe shore up its banks. Ultimately mass EMU bond purchases would cause a sudden and potentially dangerous spike in the euro against the dollar. There lies the rub. If the ECB failed to loosen monetary policy drastically to offset this, the experiment could go badly wrong.

A pioneering school of “market monetarists” - perhaps the most creative in the current policy fog - says the Fed should reflate the world through a different mechanism, preferably with the Bank of Japan and a coalition of the willing.

Their strategy is to target nominal GDP (NGDP) growth in the United States and other aligned powers, restoring it to pre-crisis trend levels. The idea comes from Irving Fisher’s “compensated dollar plan” in the 1930s.

The school is not Keynesian. They are inspired by interwar economists Ralph Hawtrey and Sweden’s Gustav Cassel, as well as monetarist guru Milton Friedman. “Anybody who has studied the Great Depression should find recent European events surreal. Day-by-day history repeats itself. It is tragic,” said Lars Christensen from Danske Bank, author of a book on Friedman.

“It is possible that a dramatic shift toward monetary stimulus could rescue the euro,” said Scott Sumner, a professor at Bentley University and the group’s eminence grise. Instead, EU authorities are repeating the errors of the Slump by obsessing over inflation when (forward-looking) deflation is already the greater threat.

“I used to think people were stupid back in the 1930s.

Remember Hawtrey’s famous “Crying fire, fire, in Noah’s flood”? I used to wonder how people could have failed to see the real problem. I thought that progress in macroeconomic analysis made similar policy errors unlikely today. I couldn’t have been more wrong. We’re just as stupid,” he said.

Needless to say, reflation alone will not make Euroland a workable currency area. Nor will fiscal union, Eurobonds, and debt pooling down the road.

"Even if they do two years of fiscal transfers, and the ECB buys all the bonds, and the problems are swept under the carpet, we are still going to be facing a crisis at the end of it," said professor Scholes.

None of the “cures” on offer tackle the 30pc currency misalignment between North and South, the deeper cause of this crisis. What Fed-imposed QE for Euroland can do is make a solution at least possible stoking inflation deliberately.

This means inflicting a boomlet on the German bloc, while allowing the South to take its fiscal punishment without crashing further into selfdefeating debt deflation. It forces up prices in the North, compelling the neo-Calvinists to accept their share of the intra-EMU price readjustment.

The Germans will not like this. If inflation causes them rise up in revolt and leave EMU to the Latins, so much the better. That is the best solution of all.

What we know for certain is that Europe’s current policy settings must lead ineluctably to ruin and perhaps to fascism. Nothing can be worse.

Why is the American establishment media sanitizing reality?

Madison Ruppert Infowars.com November 28, 2011 The December 5th, 2011 cover of Time Magazine represents a disturbing truth: the American corporate-controlled establishment media presents a picture of the world that is meant to placate and pacify the people of the United States in favor of presenting reality as it is.

While the covers of the European, Asian, and South Pacific editions have an image of chaos in the streets in Egypt with “Revolution Redux” in bold white letters in the center, the American edition is a cartoon with the headline “Why Anxiety is Good for You.” Is this just a meaningless marketing tactic or does it exemplify the greater trend in how the American corporate media presents the world to the people of the United States?

I tend towards the latter, given the fact that this is something that is inescapable when consuming media marketed to people in the United States. When I have the unfortunate pleasure of turning on the radio and listening to National Public Radio, I never cease to be amazed by the topics they choose to cover.

While much of the economies of the world are in shambles, uprisings both real and manufactured are occurring around the globe, brutal police crackdowns are taking place in the United States and the federal governmentis attempting to legalize indefinite military detention of civilians, even American citizens, without trial or charge, they opt for fluff stories with little-to-no meaning whatsoever.

This is the unfortunate nature of the “infotainment” industry that appeals to the lowest common

denominator instead of attempting to inform and educate their audience.

The debatable aspect of this grim fact is if it is simply a result of sacrificing information and content in favor of ratings or if it is a calculated agenda to dumb down the American people.

I tend to fall into the camp of people who believe that this has been too pervasive and relentless to be the product of just doing whatever it takes to get ratings.

Take, for instance, the recent study that found that viewers of Rupert Murdoch’s Fox News were actually less informed about current events than people who watched no news at all.

While this probably seems like a somewhat obvious conclusion to anyone who has sat down and watched Fox News, the fact that it was actually shown in a study is quite surprising.

Then again, when their own hosts don’t watch the entire clips they are covering and supposed legal experts claim that pepper spray is a food product while proving they are wholly ignorant of California legal precedent, one can’t expect much.

The poll was conducted by Fairleigh Dickinson University and utilized 612 New Jersey natives. Fans of Fox News failed questions about Syria and Egypt, even when compared with people who said they didn’t watch the news.

The New York Daily News wrote, “Fox News fans flunked questions about Egypt and Syria when compared with people who don’t watch the news.

Fox viewers were 18-points less likely to know that Egyptians toppled their government and 6 points less likely to be aware that Syrians have not yet overthrown theirs.”

That being said, I might point out that the Egyptians did not in fact “topple their government” instead they ousted Mubarak and replaced him with an arguably even more brutal military junta.

Dan Cassino, a professor at Fairleigh Dickinson and an analyst for the poll said that since they controlled for partisanship, this was not a question of Republicans or other groups being more prone to watch Fox News.

The results actually found, “there is something about watching Fox News that leads people to do worse on these questions that those (sic) who don’t watch any news at all.”

How can this happen? Is it just that they are seeking to entertain and not really inform? Or are newsoutlets like Murdoch’s Fox News actually there to make the American people perpetually ignorant?

The mainstream media presents such a limited spectrum of the information out there, especially when it comes to broadcast television, that it is hard to believe that it could simply be a natural result of the push for ratings over all else.

The world view presented by the establishment media is so consistent and carefully crafted that it would be quite surprising if they all happened to decide to present such a version of reality completely independently.

This outlook claims that the economy recovered when the government said the recession was officially over, that the government told us the whole truth about the attacks of September 11th, 2001, and that we are never deceived about the true intentions behind conflicts abroad.

However, reality continues to smash through this false paradigm presented to us by the establishment media and with every passing week another crippling blow slams into the false narrative.

Despite the efforts of Time to present a cartoon and a light-hearted cover story as the most important news, much of America is realizing that there is truly important information out there that is just waiting for them.

The most fatal flaw of the establishment media is the Orwellian doublethink that is used on a disturbingly common basis.

One of the most glaring examples in recent history is the case of Libya where al Qaeda-affiliated and rabidly racist rebels who are comprised mostly of fighters belonging to designated terrorist organizations became freedom fighters and pro-democracy protesters.

While we are supposed to praise and laud these murderers according to the corporate media, we are still supposed to believe that the al Qaeda bogeymen are around every corner hoping to blow us up. A slightly more obscure example from September of this year came up when Fox News was covering the usage of weather modification, also known as geoengineering, to combat a drought in Texas.

While weather modification is an irrefutable fact, it is still nonsensically treated as a conspiracy theory in some circles.

When they speak about it on the mainstream media it is a normal and acceptable solution to environmental problems, but if you speak about it you’re labeled a conspiracy theorist.

Unfortunately this type of blatant doublethink and outright deception is becoming more prevalent and the upcoming Time cover is a great example of how the events of the world are shaped and spun in the American mainstream media to keep the people of the United States from becoming agitated or asking too many questions.

Thankfully, there is the alternative media which is growing independent of traditional news organizations and funding sources thanks to readers and business owners who are willing to support the new wave in journalism.

We will continue to present the truth, the whole truth, and nothing but the truth, while the establishment media continues to present dumbed-down nonsense which will only serve to drive their viewers to sources of real information.