Updates
Update 1: Markets are tanking as the rats flee the ship. Expect to see the circuit breakers kick in, followed by the PPT.
Update 2: Keep an eye on the French and German banks. Their exposure to Greece is absurd.
Update 3: AIB (Allied Irish Bank) just defaulted(!) so that makes two canaries in the coal mine.
Update 3: AIB (Allied Irish Bank) just defaulted(!) so that makes two canaries in the coal mine.
Main Article
In order to understand global finance, we need to understand how a giant supertanker operates. Think of a developed nation's economy, like the U.S. or England, as the vessel itself, fully laden with oil. There is a captain, along with other important crew members who make important decisions on a daily basis. Fully loaded, this supertanker takes a very long time to reach maximum operating speed, and even longer to adjust course. Yes, a simple 90 degree turn to avoid a major storm, for example, usually is planned long in advance and hundreds of miles ahead of the obstacle.So too, a large complex economy takes years to change its heading, if a storm is ahead. Why the "captains" of this supertanker vessel named, "The U.S. Economy" failed to see action was necessary back in 2003 is beyond anyone's comprehension. Even a change of command has failed to produce the correct results. Now, 8 years after that "point of no return," the consequences of their (in)actions are coming back home to roost - a global economic collapse is upon the entire world.
As we have been warning since, well... as long as this blog has been publishing, Greece is insolvent. Although one could make adjustments to their balance sheet to make it appear "solvent," the fact of the matter is, Greece's wallet has more holes than Lady Gaga's fishnet stockings. It is obvious to everyone with the ability to add and subtract single digits, that Greece can't function as they are. Yet, all of this was not obvious, or simply ignored by the captains of the global supertankers. We're heading right into the storm - a category 5 hurricane with winds in excess of 250 MPH and ocean swells 900 feet high. Yeah, straight out of a Hollywood movie. Greek bonds have literally exploded (well, we did tell you months ago to keep your eyes on CDS spreads and Greek bond yields). Exactly as predicted two weeks ago, the massive protests would turn ugly. Oh, and keep your Irish eyes on Ireland. Just for fun.
Today, we see that Greece is on the brink of a full revolution; a situation that could indeed cause the entire European Union to disintegrate; the consequences of that occurring, would be the domino to collapse the global economy. Too Big To Fail Banks, meet your long lost brother, Too Big To Fail (But Already Have Failed) Monetary Unions. These could be the last days of the EU as we know it. Guess Hu who won't be so happy?
Greece is experiencing the largest protests to date, and they have turned very violent - fire bombs, tear gas and all. We're getting updates from "Occupied London" and the latest report shows "a lot of people are injured by the brutal attacks of the police." It's on like Donkey Kong. General strikes always are bullish for a nation's GDP, just like a magnitude 9 earthquake, followed by a tsunami and three nuclear reactors going into full meltdown are bullish for the global economy. Has Warren left for his bunker yet? Munich Re is calling.
Speaking of meltdowns, for those of you who have been following this site, you know that the Missouri River has reached critical level and last week we said to keep an eye on the little things like, St. Louis and Ft. Calhoun nuclear power plant. Little things that have no impact on the economy. Now, we get confirmation from several sources that we may have our own Fukushima disaster here in the U.S. Yes, Ft. Calhoun has been upgraded to a level 4 emergency (ironic, since Japan said Fukshima was a level 4 emergency for almost a month after the catastrophe). This should be an early warning to those living in and around Ft. Calhoun and every town on the Missouri River. Arnie Gundersen has said this could go to a Fukushima level disaster very soon. We suggest, if you watch one video today, make this the one.
In another sign that the U.S. is becoming a police state big brother is watching, Postal Service employees are being told to keep a close eye on you. The next time to see Mr. Postman making a delivery, he may also be scouting your home. All in the name of "national security," of course. After all, the Postal Service is already insolvent, might as well, "add that to the bar tab," to pay for over time spying. What's another $1 Billion or so?
Speaking of bar tabs, a new article in the AlterNet news says the real U.S security budget is $1.2 Trillion. Shhhhh! Don't tell anyone.
Another event we are keenly reporting and the main stream media is ignoring is the super volcano in Chile which continues to spew hot ash for thousands of miles. Over 80,000 square miles have been covered in ash, decimating the local economies there (remember, this is bullish for the global economy) and this new video shows ash so deep, you can swim in it - and that is 100 miles away from the volcano. Ok, so this is also another video you must watch. That makes two for the day.
Fukushima: Ok. Here it is. You wanted proof that high levels of radiation are leaking into the sea and that Fukushima is a possible ELE? Radioactive whales found 650 Kilometers from Japan. No commentary necessary.
Once again, Energy News never disappoints with news as this headline supports - "Japanese media blackout of words: MOX, plutonium, and meltdown." The term "coverup" does not describe it.
Finally, to update you on another scam internet IPO, Pandora shares soared today after the retail suckers investors bit the bait, only to collapse as market makers, banks and other scum ran away with literally hundreds of millions of dollars in instant profit the rats ran for the doors. All in a day's work.