F*** you Pay Me (International Bankers Anthem)

There is a new law of the land that has the blessing of some of the most evil minds in the world – bankers. Along with their political flunkies, they have finally devised a way to get all of the money in the world not only from nation states but also the citizens of said nations. And the strange and sad part about it is that it was the bankers who created these problems. Like magic the result of their gross malpractice, out of thin air, similar to the manner in which the Federal Reserve Bank creates money, it has been decided that anyone who saves 100,000 euros is now considered rich. Thus a new era, an era in world finance and international banking where for the first time ever, a major banking system will take and steal from depositors to pay for the government/bank interactions that created the mess in the first place.

For an average mind such as mine, what has happened in Cyprus will not be a mere caduceus act, but eventually common practice. Eventually all citizens, of every nation with massive debt, no matter where you live, in particular in Europe, now no personal/private bank account anywhere in the world is safe. If the big wigs of the EU (Mario Draghi, the president of the European Central Bank (ECB), Christine Lagarde, the managing director of the International Monetary Fund (IMF), José Barroso, the president of the European Commission (EC) and Herman Van Rompuy, the president of the European Council), can pull this off, you can best believe some similar folk of status are meeting around the United States in the board rooms of the twelve Federal Reserve banks.

The precedent set by the Eurozone to go for depositors is a reflection of how uncertain the world of derivatives and complex papers is. What we see, what we understand, are the images of long lines in front of ATMs and for what – all to save the institutions that gave us the economic downturn, just to save the banks. Around the world, just in the US the banks are what are important and not the people even if they are the criminals, they only get larger and are even beyond incarceration [see JP Morgan Note below].

NOTE: [The U.S. Treasury’s Office of Foreign Assets Control found that JPMorgan had illegally aided dictatorships in Cuba, Sudan, Liberia and Iran, including transferring 32,000 ounces of gold bullion for an Iranian bank. Not to mention misleading investors, making fake and false trades, wrongfully foreclosed on soldiers charged veterans hidden fees for refinancing, illegally increased their collection of overdraft fees by processing large transactions before smaller ones or by switching its fixed-rate debt to variable helping push Jefferson County, Alabama into bankruptcy.]

Although under the guise of a bailout, what we see in Cyprus is an indication of things to come worldwide. If another bailout is need for another EZ nation, the likes of Spain and Italy, then the savings accounts of the citizens in Spain, Italy and other countries will be raided. Now some will say its different because in Europe, many nations are way over leveraged and that they are taking these steps to preserve the Euro by aiding insolvent and failing banks. I will agree but would ask how that is any different from the situation with the US dollar and “too big to fail banks?”

As during the time of the great depression and what America is dealing with now, it is common knowledge that excessive leverage was one of the primary causes of both – folk buying stocks and other complex papers on margin. And excessive leveraging undermines financial stability because the goal of the banker is to always transfer credit risk to those better able to absorb losses. When it is impossible to do the aforementioned, the financial sector becomes weak and breaks.

Ironic that I just finished reading Richard Bookstaber’s “A Demon of our own Making.” He describes this so aptly. He notes that new forms of investment strategies like portfolio insurance, based on the Black-Sholes formula of making it possible to set a price on an option and features such as “greenmail” gave us the crisis of not only the past but today.

Today the US banking system as a whole is leveraged at 13-to-1 compared to about 26-to-1 for the Banks of Europe. The US Federal Reserve has about $2.8 trillion in assets and only $52 billion in capital, meaning the US Central Bank is leveraged at 53 to 1 – worse than Europe. Just keeping it on the level, a recent report from the Comptroller of the Currency, noted that four U.S. banks have $235 trillion of OTC derivative leverage. As a nation, all the US banks are estimated to have a total OTC derivative exposure of $250 trillion.

When banking systems are or become excessively-leveraged, the risk that a crisis in one country will spread to another dramatically increases. Meaning that the reality is that the US financial system could come tumbling down the hill at any time because it is mathematically impossible for just the continuous printing of money alone can go on forever.

Another concern I have is that less than two years ago, all the banks of Europe were given stress test, which by all accounts were way harder than the stress test given to US big banks by the Treasury, and all the banks of Cyprus passed with flying colors. Now within the last two weeks we see such wasn’t the case since Cyprus’ two largest banks, the Bank of Cyprus and the Cyprus Popular Bank (the Laiki Bank), which hold half of all bank deposits in the country are the worse of the bunch, and if this is the case what can we interpret from the weak azz stress test the US Treasury implemented some few years back as well?

In addition to the math, the behavioral antecedents are clear as well – it’s all about the banks, fuck the people and the workers and the average family. The precedent of Cyprus is clear - nothing is safe from being seized by the state, no savings account, but also no house or apartment. The Germans experienced this after World War II, when they were charged an extra real estate tax in the form of compulsory mortgages. Governments have even banned the possession of gold during currency crises, forcing citizens to exchange the precious metal for the national currency.

Even with the aforementioned, the Federal Reserve, Wall Street and Washington Politicians always want to point the finger at the average citizen. Ben Bernanke let it out the hat when he advocated for the elimination of all reserve requirements: “The Federal Reserve believes it is possible that, ultimately, its operating framework will allow the elimination of minimum reserve requirements, which impose costs and distortions on the banking system.”

The simple reality is that no matter what happens, the majority of people will be significantly poorer. As it stands, not only in the US, but around the globe the continuous transfer of wealth from the bottom into the pockets of the wealthiest is a reality unavoidable. Here in America consequently, we must not be fooled by leaders regardless of party affiliation and their words of addressing economic equity because their actions never fit the actual goals they promulgate via their illustrious oratory. No matter what Obama for example says on the political stump, his policy continues to add to the economic inequity in America. For example, no matter what he says his policy will always aid in the disparity for example of the average CEO’s hourly wage of $5000 per hour compared to $7.00 an hour. The point is if in Europe, Cyprus to be more exact, any level of personal savings decided upon by bankers for confiscation, is basically the same as just stealing money from people’s bank accounts.

On top of all of this (and I won’t mention our debt to China) China and Brazil just signed a trade, currency deal ahead of BRICS summit that will allow them to bypass using the dollar by agreeing to trade in their own currencies the equivalent of up to $30 billion per year, moving to take almost half of their trade exchanges out of the US dollar zone. Thus there is a new world post the 1950s, Bretton Woods and the Marshall Plan when the US Dollar became the de facto global reserve currency.

Like the Euro, the reality is that the global exposure to the US Dollar remains by default rather than design and the global (at least European) sovereign debt crisis is placing the US Dollar at risk for the future. Just looking at Cyprus, it should be clear that oligarchs and plutocrats, who are protected by the elected elite, will always be considered over the average citizen. The Bankers (not the people or elected leaders) have decided that citizens, who had nothing to do with the national debt as individuals, will be forced without choice to pay for the faults of the elected elite which sets a truly alarming precedent for other debtor (all nations) around the world.

I am just asking the question and using basic match to formulate a possible answer. I mean there is only one answer, albeit multiple solutions to solve any equation. I just think this may become banking versions of reality TV, and if that show had a name, it would likely be called “F*** you, pay me (the international bankers anthem.)

Cyprus, Not Cyprus Hill Negro

One of the biggest news stories thus far this year was the lead for the top German, Brazilian, Japanese and Canadian Television outlets yesterday. But it wasn’t even mentioned in the coverage offered by CNN, MSNBC, ABC, NBC, or CBS via broadcast transcripts - Thank God for PBS and the News Hour. Not to mention it wasn’t even a consideration for coverage by African American political bloggers or news sites the likes of The Root, Politics 365, The Grio or any other supposedly political news site that is run by African Americans. And no it was not Obama in Israel, or even Keisha Cole and Beyoncé, rather the run on banks and the EU central bank actions toward Cyprus. Yes to get a bailout from the EU central banks, banks are now allowed to take money from all bank depositors – all account holders.

Now I know many will ask, “What does that have to do with me?” A lot and I will attempt to explain, albeit I know it may be difficult for many of us African Americans because we never heard of Cyprus, care or know anything of substance of the Eurozone sovereign debt crisis, but such should be no excuse. See what happened over the weekend was that a group of EZ leaders, the IMF and newly elected President of the small tiny island nation with a GDP the size of Vermont and a population the size of Philly agreed to force all with a bank account to pay for the government’s debt. Banking will never be the same if folk can’t truth the banks and since they saw the could not trust the EZ, IMF, government or the banks they started to pull all of their loot out.

The EU central bank has decided it is ok for big banks to take money out of the accounts of private citizens to pay for the debt of the nation they live in. Yes that right, all under the guise of it being a new tax. Strange since taxes are the result of political legislation and don’t go back in time. But that is what the large global banks are doing and if they can do it there, they can do it here, especially given Obama’s lack of gonads to even prosecute and arrest bankers. Even funnier is the fact that the banks are taking citizen’s money for loans they did not ask for and which the banks knew were bad when they first made them to the government of Cyprus.

Some will naively assert that this is America and it could or would never happen here. Surprise, it already did, last year from on one of Obama’s boys – John Corzine of MF Global. What Corzine did is what we see happening in Cyprus right now – bank account seizure (tax) without due process. Thus if it can be done in Cyprus, it can and will be done in Italy, Ireland, Spain and even the US, since bankers who caused all this nonsense with the assistance of inept politicians will seek to get all their money from the governments they loaned them too to cover for the losses of the zillions of different complex papers they created that were then and still today basically worthless. But yawl don’t hear me though.

What I can say factually that the present Administration, as the last four are for the fat cat bankers and Corporations. Just from IRS statistics we know that Americans who made over $10 million in 2010 paid on average just under 24 percent of their incomes in federal income tax, less than a third what they paid in 1950. The end result of such practices is a nation in which corporate profits are setting records while typical workers continue to make less than they earned a dozen years ago.

You know there was a time in America when corporations paid taxes, no lie. Not anymore even when corporate profits have been growing per annum at a 20 percent rate. In fact, to find a year when corporations were grabbing as great a share of America’s income as they’re grabbing now, you have to go back to 1950. In the 1950s, the average corporation paid about 40 percent in annual taxes. Now, major U.S. corporations actually pay about 12 percent in taxes. Why is this a problem, well in 2011, the Institute for Policy Studies, reported that 25 major U.S. corporations paid their CEOs more than they paid in corporate income taxes.  Then we can take alook at NYC where the number of  residents receiving food stamps has  more than doubled over the past decade under Mayor Bloomberg, according to data released yesterday. Now, 1.8 million receive food stamps, a jump from 800,000 in 2002, and the Independent Budget Office data show. But 99 percent of African Americans believe their President even against fact that the economy is growing. But it is not and if I accept this premise, then for whom is it growing?

First, the cost of the federally funded food-stamp program in places like NYC had increased dramatically to $3.4 billion from $1.28 billion over the past decade. True, naysayers and other average minded individuals reinforced on reciting lessor proofs proffered my weaker minds will say look at the stock market. I in return will say, yes, look at it. But reality notes that the stock market is not a good indicator for overall wealth of Americans since the average American’s wealth, if the happen to own a home is in home equity - real estate values are still down about $5.5 trillion from their peak. So thinking about, one has to ask if the economy is doing so well and growing as Obama describes it, why then are there over 47 million people in the US living on food assistance to survive. It is clear they are not obtaining any of this wealth.

The Administration is a top down machine just like it was when Ronald Reagan started the practice. The US financial system is buttressed upon trillions of dollars of bailouts and loan that result in risky speculation that cause incessantly financial bubble after bubble. Right now, America has a record debt of $16.7 trillion. Maybe this is why as quiet as it is kept, the Obama administration has announced policy that would allow the federal government to control private citizens 401k’s.

Plainly stated, it is the cost of borrowing money itself that has bankrupted Cyprus, Ireland, Spain and Italy. As it stands, the same shackles of debt are on the hands and feet of the US government and if history is any indication from a policy purview, the people will be the ones to pay for it. But this won’t happen, Obama and Bernanke are so stuck on “quantitative easing” even when they know and data points out that it is just making money out of thin air via a few zeroes added via a computer monitor. The problem with today’s QE is that it has put money into the pockets of the big fat Wall Street bankers but not into the pockets of consumers. What we need is to obviate all public debt and let the corporations and banks keep theirs and let them deal with the problems they created as a fiat. I mean default on the public debt has worked in Iceland, Argentina, Ecuador, and Russia, among other countries.

 But this all makes too much sense and we African Americans don’t care if it hasn’t anything to do with a singer, rapper or anything on television. I know, I asked all of my classes if they were aware of what had occurred in Cyprus: one asked, “you mean Cyprus Hill?” I responded “naw Negro, Cyprus not Cyprus Hill.” Cyprus may be just the start. As of now banks are closed until Thursday. We will have to see if a run starts again and if it spreads to other European nations, if so, it could be the end of the Eurozone and the start of the demise of the US economy. Two years ago we exported 40 percent of our goods and services, this year its down to 21 percent.

Americas Biggest Threat is EU Sovereign Debt Crisis not AQAP

Okay, let’s get this straight. The injudicious assertions promulgated by political charlatans on both side of the aisle from Obama to Congressman Pete King that America’s biggest threat is Al-Qaeda in the Arabian Peninsula (AQAP) is feculent and even dangerous. In fact it is one of the more laughable jactitations proffered in recent years and ranks up there with the suggestion that America is post racial or even that Wall Street and bankers can police themselves.
In all honesty as things stand, our truest and greatest threat is the European sovereign debt crisis and not AQAP. For if the chickens come home to roost, with the chickens in this sense being the massive preponderance of complex financial papers and derivatives which remain without a true valuation and inundate the global markets, and then we have seen nothing yet in terms of an economic disaster. I means, what is on the horizon given what is occurring in Europe will eventually demonstrate that what we just observed with regards to JP Morgan-Chase and Jamie Dimon will be just a drop in the bucket.

But instead of giving these events the attention they require and other signals, we ignore them and continue with the small thinking myopia that would advance a HR 1838 (SWAP Bailout prevention act) on behalf of Republicans or an HR 3784 (Gas Price Spike Act of 2012) on behalf of democrats. The later under whom oil companies would be taxed at 50 to 100 percent of profits considered to be “higher than reasonable.” Notwithstanding other distractions whether they concern Mayor Cory Booker’s honest remarks on private equity or the President’s personal opinion on Gay marriage, we never seem to be able to be proactive and address real issues that will impact us more than any of the aforementioned in aggregate. Fact is gay marriage has nothing to do with the US economy.

Bush, followed by the Obama administration implemented massive stimulus that were supposed to grow the economy. Unfortunately, such has not manifested as promised by the Keynesian heavy Obama administration (Bernanke, Krugman and Geithner). By their logic the stimulus was supposed to produce fifty cents of GDP growth for each stimulus dollar spent. But instead of increasing demand, what they did was discourage consumption and investment by the private sector who based on all this talk, rightly expect tax hikes to finance the stimulus somewhere in the near future. Meaning that the stimulus actually squashed the private sector spending it desired to stimulate.

This may be why the CBO recently reported the strong chance of another US recession soon. They predict that the US Gross National Product (GNP) will go negative for at least two quarters, given the eventually ending of the Bush-era tax cuts, the extended unemployment benefits and the reinstating of the payroll tax rates back up to 6.2 percent from the current 4.2 percent. Not to mention that currently as a nation, we spend $454 billion a year just on servicing the interest on the national debt alone. Then there is the $642 billion spent on the Afghan war (this includes this year’s spending). And let us not forget the 11 million homeowners in the US with in excess of $800 billion in negative home equity and you can see we have a big mess on our hands without the problems in Europe.

Starting with the UK, Britain's economy contracted by 0.3% in the first three months of the year, faster than previously thought and pushing the country back into another recession and equal to the contraction in the final quarter of 2011. There has been no growth in manufacturing after last year the sector exhibited a decline of 0.7% at the end of last year. The banking sector also contracted, by 0.3%.

Then there is Spain. Spanish banks’ total loan losses could range between 218 billion and 260 billion Euros, more than currently expected according to estimates by the Institute of International Finance. Spain’s economy is in critical condition with 23 percent unemployment of which 50% percent of those under 24 are unemployed (the highest in the Euro zone) and they are in their second recession in three years. Spain like all the European countries that, are uncompetitive, have high debt levels, and suffer from low savings rates that have been forced down in over the past years - one reason why 16 Spanish banks were downgraded last week.

The picture is no different in Italy which saw Moody‘s Investors Service downgraded 26 Italian banks, where investors are needing higher risk premiums for Italian government bonds on fears that Greece may exit from the euro zone and Italy's double-dip recession . Italy is estimated to have around a debt burden of €1.9 trillion (about 120% the size of its gross domestic product), or about $2.6 trillion).

The reality is all the talking and meeting the G-8 just did wasn’t anything and empty, especially without Russia, China and India in attendance. The realty remains that a Greek euro exit is very likely and soon. If it happens, it will lead to runs on Spanish and Italian banks, resulting in the need for the ECB to give out more credit to keep the banks from collapsing. Although the problem isn’t Greece, but rather that Greek banks are undercapitalized. Greece cannot crash the euro zone alone. But what it may lead to can. If they are allowed to leave, the same will be true for other nations.

Ben Bernanke and the politicians in Washington DC speak of recovery while the facts do not support their contention. Not to forget that it was in the 1970s when Nixon enabled bankers and politicians to print and spend at liberty without a gold standard and a Central Bank owned by Wall Street, has resulted in a country where the cost of things we need to live have risen at twice the rate of our income. The truth is that real inflation has been running 5% higher than government is telling us in spite of what is being told to us by Paul Krugman (that there are very few Americans living on a fixed income being impacted by Bernanke’s zero interest rate policy). Maybe this is why Krugman is so bent on another $4 trillion of debt and a debt to GDP ratio of 130% to get our economy back on track.

Yes we cannot see the big picture. The real US deficit is over $5 trillion. Our policy appears to ignore Greece, which after several years of austerity are in the midst of a full-blown economic depression and they still do not have a balanced budget. The Greek economy has contracted by 8.5 percent over the past 12 months and the unemployment rate in Greece is up to 21.8 percent, is already experiencing a depression that will only get worse. If or when they leave, investor confidence in the euro zone will be damaged forever. Already as a nation America has more government debt per capita than Greece, Portugal, Italy, Ireland or Spain.

Europe is our largest trading partner, especially as it pertains to exports. Yet our efforts are all over the place. Paul Ryan supposed spending cuts really only slow spending to 3 percent annually while Obama increases spending 4.5 percent a year in his budget. No to mention that like the EU zone banks who are undercapitalized and heavily burden with the uncertainty of how much banks actually hold in bad assets, and the potential need for the government to bail them out at the expense of a bigger debt burden, the same is true for US banks.

Economic growth is stalled both in Europe and in America plus there seems to be a lack of concern here and little if any coordination between the EU and US. None of the nations including the US are recalibrating either fiscal or monetary policy which is a must. Reform not stimulus is the answer if we look at the real world examples here and abroad. Both the ECB and Federal Reserve seem to focus on the nations and not the banks and the Obama administration has only tackled the issue from a short term perspective. So what there is a newly revealed Al Qaeda video that calls on followers to launch cyber attacks on Western targets that has Sens. Susan Collins and Joe Lieberman, chairman of the Senate Homeland Security Committee, scared, it aint got nothing on what’s going on across the pond and is nowhere as big a threat to America as the European sovereign debt crisis. Take note you heard it here first.

Washington’s New European Concern

I am blessed, first to have the family that I do and the fact that I am probably one of the only men in Atlanta who does not have cable and who has never seen basketball house wives or whatever it is called. Meaning I have more time to read and think about issues that are often avoided in American mainstream media on either side of the isle.

Over the past few years, in particularly with the election of President Barack Obama and the growing European sovereign debt crisis, I have noticed some uneasy and troubling signings in world politics. I think the war on terror brought all to the surface and things have only continued to grow tenser.

For me it started in Finland, with the rise of the True Finns, the right-wing Populist Party who last April, won 19 percent of the vote in Finland. Also there was what happened in Austria when the far-right Freedom Party (FPO), was able to obtain 29 percent of the votes giving their leader; Heinz-Christian Strache (who has been campaigning for months to kick Greece out of the euro zone) is the second-strongest party in Austria and a hard-line neo-Nazi party that desires to legalize Nazi symbols and supports the open belief of scientific racism. Both are considered far right extremists whom politics focus on xenophobic and anti-Islam positions common to the right wing politics across Europe including the British Nationalist Party (BNP).

There are still other nations of concern. In Hungary, the Jobbik won nearly 17 percent of the 2010 vote, and is one of two leading opposition parties along with Fidesz, who won an overwhelming Parliamentary majority last year. The conservative Fidesz party of Prime Minister Viktor Orban has passed laws restricting civil rights and basic freedoms that go against the country's EU membership. In Denmark, the Danish People's Party is the nation's third largest political organization, and has pushed Denmark to adopt some of Europe's strictest immigration laws. The British National Party has a policy that restricts membership to 'indigenous British people'.

As, Europe falls back into depression, the rise of authoritarianism, fascism, and the hard right wing will continue to grow and become a thorn in the side of US political concerns, in particular how we deal with the impact of these changes to our economy in a global market place. The economy of Europe is in dire straits with little if any growth occurring and extremely high rates of unemployment.

Now the wave is continuing across Europe in two of the hardest hit by the recent sovereign debt crisis – Greece and France. In Greece, the Independents (right-wing) and the far-right Greek neo-Nazi Golden Dawn party will hold more than 50 seats in Parliament. This will be the first time in fifty years that the Golden Dawn party will enter parliament. Its leader, Nikolaos Michaloliakos and the party campaigned hard against illegal immigration, and its supporters wear black shirts, and its emblems resemble Nazi insignia. Both Greek party’s reject its bailout commitments and write off its debt.

In Greece, the party with the most seats is given the first opportunity to build a coalition government. It continues down the line based on number of members in party until each party is able to accomplish this. If it is not accomplished, the inability to secure a political majority to meet the terms of the second Greek bailout would likely result in a Greek exit from the EU and more financial trouble across the globe. This means that Greece has to approve more than 11 billion Euros in additional budget cuts by the end of June in order to receive the next round of bailout money. Seeing this is the sixth year of the nation’s economic contraction and no one wants to hear the word austerity we may as well expect them to be gone by all accounts.

Add to this the election of Socialist Francois Hollande in France. Like Greece who suggests that the election results are a referendum against German austerity policies, France election seems to show the same thing. However, the German government on Monday ruled out reworking the European Union’s fiscal pact despite request for such by French president-elect Francois Hollande. Hollande also states that he wants the very rich to pay 75 percent in income taxes and “plans to hike taxes on companies that distribute profits to shareholders instead of investing in their business.” Although he campaigned on being strong on anti-immigration, he has gone on record saying that he would give residency to illegal immigrants on a case-by-case basis. Hollande will be France’s first socialist president since 1995. His proposed policies as a consequence could have major implications for all of Europe.

If history is any indication political turmoil will only grow. Germany’s obsession with austerity and hard money if we recall, is one factor that resulted in the conditions that gave rise to Hitler. We have seen what extremes can occur in the case of Anders Behring Breivik – the self-proclaimed ‘counter-jihadist’. Breivik’s conservatism focused on a xenophobic hatred of Islam and of those groups, notably political parties like the Labor and Socialist Left parties that supported immigration and asylum laws increasing the European Islamic presence.

Washington has a serious problem. Tax increases I concert with sever austerity programs I Europe have brought the far right to the front in politics. Obama needs to take heed giving that he is taking the advice of Robert Reich and Paul Krugman, who both favor a large tax increase for the United States. Obama supports their endorsed a 70 percent top marginal tax rate but doing nothing to prevent the $494 billion tax increase set to occur automatically on January 1, 2013, when the Bush-era tax rates expire under current law. Europe’s difficulties are diametric opposition to the response of Washington. The recently proposed Obama budget will send the United States more deeply into debt.

Washington needs to pay attention and stop ignoring the seriousness and likely impact of what is happening in European fascist political rise on the US economy. For the reality is that a default by Greece or any other country in the 16-nation Eurozone would be potentially deadly not only for Europe, but America as well.

'End of euro road in 48 hours if no summit solution'

Europe’s Sovereign Debt Crisis and Germany’s Historic Economic Conundrum

I have been giving the global economic crisis a considerable amount of thought. If you have been reading my essay’s on this blog for any considerable length of time, you are aware of my predictions as early as 2007, with respect to how the US, Greek, French, Spanish, and Italian economies would falter as a function of unsustainable fractional banking practices of central and private banks, poorly formulated and conceived economic political policy, the incessant propensity to employ Keynesian economic philosophy to provide the fasade of short-term solutions to providing economic growth, and how these problems are not due to a liquidity issue but rather a massive debt contraction in which printing and disseminating additional paper money only makes things worse (quantitative easing).

The predicament that Germany finds itself in is unique and historically explains why they have taken the position they have. Many western nations including the US and its major European counterparts have been giving Germany the business for not want to bailout nations heavily burden by debt in which their citizens receive big pension pay outs so that they can retire before age 50 and live club-med life styles.

Since the times of Bismarck, Germany has been considered a threat to the rest of Europe. : This both economically and militarily. Ever since Prussia defeated France in the war of 1870-71, this has been the case. Even after the war, Germany did not really rebound economically until 1895. By the time they did, around 20 years later the First World War had started and in-between that time the British government, among others was taking a page from Napoleon and the US Civil War to destroy German economic growth via an extensive counterfeiting operation.

Unlike the European nations who are in dire economic straits and begging for Germany to take on their massive debt burden, they remember how the Allies dictated the harsh terms in the armistice signed at Compiegne, France. The reparations imposed as a function of the Treaty of Versailles led to hyperinflation in 1923 which only got worse when the depression hit the world in 1929 which resulted in massive deflation. The treaty resulted in Germany giving up an eight of its territory which equaled near 7 million people, all of its international investments and it colonies outside of Europe. Leaving the nation with close to 150 billion Marks in debt.

Neither the European Union nor the US has a Dr. Hjalmar Schact to assist them in this present crisis. It was Schact who revived the 1920s Weimar Republic of Germany from post WW 1 hyperinflation. A period before then which saw a currency exchange rate of 1 trillion Marks for 1 US dollar. German as well as the rest of Europe knows this recent fix is short term and is equal to using dental floss to splint a compound fractured leg. Just today banks in Britain still acknowledge that the euro zone crisis was the biggest threat to the UK's banking system. This is why Germany is reluctant to assist in the massive Euro zone bailout in which they would assume most of the exposure. German foreign minister Guido Westerwelle has rejected the notion that the debt deal agreed in Brussels recently could be renegotiated to give Greece more generous terms while he was speaking in Istanbul.

This is why the World’s central banks (led by the US Federal Reserve) reduced rates to prop up the broken legged Euro zone economy once again. “The Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank (ECB), the United States Federal Reserve and the Swiss National Bank on Wednesday announced a coordinated attempt to provide liquidity support to the global financial system to avert further global financial distress.”

The Federal Reserve, in a morning press release, said that it will take measures to provide easier access for European banks that hold dollar-denominated currencies for dollar loans to U.S. currency. This translates simple into Washington politicians from Obama to the Congress made easy millions by buying stocks knowing they were to bail out some countries in Europe.

The bottomline truth about today's Federal Reserve-led coordinated effort by developed worlds' central banks to ease the liquidity problems of European banks is this: It doesn't change anything. European leaders still have the same tough decision to make. Either impose even stricter austerity measures on Europe's struggling nations or force Germany and other stronger European nations to come forward with an even bigger bailout, or, of course, kiss the Euro good-bye. Germany keeps all of this in perspective and in the back of their collective unconscious, they have to remember the Treaty of WW 1 and the hardships of hyper-inflation suffered them and after WW 2. Thus it is no wonder they are hesitant to help the very nations who destroyed their economy. The parliament remembers because they suggest that German participation in bailout process violates limits of acceptable integration within the EU, interfering in sovereign affairs of other member states. This even if Angela Merkel and the German courts do not. The reality is that no matter the German court ruling, its decision has little to do with saving the euro in the long term. The state of Europe will eventually show it’s jaundiced and gangrene infected economic limbs and do as all bacterial infected cells do, and Germany will survive waiting in the wind while the rest of Europe remains helpless.

If I can recall of this history, surely the Germans can and the rest of Europe. But as to the Us Federal Reserve and President Obama, I doubt it and this really scares me about the economic prospect for Americans long-term future, one in which we are trying to create with short-term and temporary fixes.