Berlin Pushing For European Bankruptcy Framework With Provision For State Sovereignty Give Up

http://www.zerohedge.com/article/berlin-pushing-european-bankruptcy-framework-provision-state-sovereignty-give

This is the precursor to WWIII.
Governments, have spent their countries into oblivion world wide, regardless of what their citizens thought. Every country, not just the European Nation, could become subject to the same conditions for Angela's rules of bankruptcy.
Think about it. How close to a calamity is your own country?
Would you be willing to give up your country's independence and sovereignty all because your government can't reign in it's excessive overspending?
Because that's what it's all boiling down to now.
How soon before "All of Us" are governed by one faction if Angela's rules are allowed to set a precedent?

Is servicing the interest on our government debts really worth another world war?
You have the power to just say No!



The big news out of Europe this morning, and the reason for the drag on the euro is an article in Der Spiegel, "Merkel's rules for bankruptcy" according to which Germany is now actively (and very secretly) pushing for a plan outlining a set of insolvency rules, which would require that private investors bear a portion of the rescue burden, and much more importantly, would see at least a partial give up in state sovereignty, where a new insolvency trustee (the "Berlin Club", which we fail to see at least for now, how it differs from the Paris Club) would take implicit control over and override a default nation's treasury, in essence pushing the bankrupt country into a form of Feudal vassal state-cum-reparations subservience. Welcome to financial warfare in the post-globalization period.

The main reason for the initiative is, of course, Germany's taxpayers' increasing dissatisfaction with the growing financial burden they are forced to shoulder as more and more European countries succumb under the need to resort to a bailout of some sort:

The effort is necessary, because important safety measures to protect the common currency are not working. The Stability and Growth Pact, which was intended to nip excessive government borrowing in the bud, proved to be largely worthless.


As more and more nations in Europe succumb to the inevitable collapse of their overindebted economies, and with austerity sure to prevent a pick up in economic growth, will the only possible outcome soon be a return to Feudal europe where the less developed hinterlands become gradually subsumed by the wealthier core, and in which a certain percentage of all sovereign debt issues are immediately channeled back to the Berlin Club members? Is "insolvency reparations" going to be the 21st century equivalent event that triggered the reparation-driven toxic spiral in Weimar Germany culminating with hyperinflation and World War 2?

Does the world have the courage to deal with its debts?

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/6146859/Does-the-world-have-the-courage-to-deal-with-its-debts.html


Enough of the world has already fallen so far into pre-deflation conditions that any misjudgment by the big central banks from now risks setting off a chain-reaction that may prove very hard to stop.

CPI inflation has dropped to –2.2pc in Japan (a modern record), -2.1pc in the US, -1.8pc in China, -1.4pc in Spain, -0.7pc in France, and -0.6pc in Germany.

This was not anticipated by the authorities anywhere, so we should be wary of their assurances now that we face nothing more than a brief dip in prices before rising energy costs bring inflation back into familiar and safe territory. No doubt prices will rebound as the "base effect" of oil prices kicks in. But by how much; for how long?

The sum of economists in the world (outside Japan) familiar with the cultural and psychological dynamics of deflation can fit into one London bus, and most are historians of the 1930s.

If PIMCO guru Bill Gross and hedge fund manager Paul Tudor Jones are right in fearing that the US economy will tip back into a "W-shaped" recession as the sugar rush of fiscal stimulus fades, we may wake up to find that we have baked deep deflation into the pie for 2010 and 2011. The G20's talk of "exit strategies" and rate rises will seem surreal.

White House aides are already mulling another blast of spending. It won't fly. We have hit the political limits of such extravagance almost everywhere. The fiscal crutches of recovery are going to be knocked away, with outright tightening in a slew of states nearing the danger point of debt-compound spirals. This will occur in a world where excess capacity is already at post-War highs. It reeks of deflation