Europe and the US are obviously embedded in the same corrupt financial architecture, so whether Europe or the US goes first the whole pack of cards is coming down.
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The Economic Collapse Blog
What happens when you attempt a cold shutdown of one of the
biggest debt spirals that the world has ever seen? Well, we are about
to find out. The politicians in Europe have decided that they are going
to "take their medicine" and put strict limits on budget deficits.
They have also decided that the European Central Bank is not going to
engage in reckless money printing to "paper over" the debts of troubled
nations. This may all sound wonderful to many of you, but the reality
is that there is always a tremendous amount of pain whenever a massive
debt spiral is interrupted. Just look at what happened to Greece.
Greece was forced to raise taxes and implement brutal austerity
measures. That caused the economy to slow down and tax revenues to
decline and so government debt figures did not improve as much as
anticipated. So Greece was forced to implement even more brutal
austerity measures. Well, that caused the economy to slow down even
more and tax revenues declined again. In Greece this cycle has been
repeated several times and now Greece is experiencing a full-blown
economic depression. 100,000 businesses have closed and a third of the
population is living in poverty. But now Germany and France intend to
impose the "Greek solution" on the rest of Europe. This is going to
create the conditions needed for a "perfect storm" to develop and it
means that the European financial system is heading for an implosion of
historic proportions.
The easiest way to deal with a debt spiral is to let it keep going and going. That is what the United States has done. Sure, "kicking the can down the road" makes the crisis much worse in the long run, but bringing the pain into the present is not a lot of fun either.
Europe has decided to do something that is unprecedented in the post-World War II era. They have decided to put very strict limits on budget deficits and to impose tough sanctions on any nations that break the rules. They have also decided that they are not going to allow the European Central Bank to fund the debts of troubled nations with reckless money printing.
Without a doubt, this is a German solution for a German-dominated Europe. Germany does not want to pay for the debt mistakes of other EU nations, and so they are shoving bitter austerity down the throats of those that have gotten into too much debt.
But this solution is not going to be implemented without a massive amount of pain.
The easiest way to deal with a debt spiral is to let it keep going and going. That is what the United States has done. Sure, "kicking the can down the road" makes the crisis much worse in the long run, but bringing the pain into the present is not a lot of fun either.
Europe has decided to do something that is unprecedented in the post-World War II era. They have decided to put very strict limits on budget deficits and to impose tough sanctions on any nations that break the rules. They have also decided that they are not going to allow the European Central Bank to fund the debts of troubled nations with reckless money printing.
Without a doubt, this is a German solution for a German-dominated Europe. Germany does not want to pay for the debt mistakes of other EU nations, and so they are shoving bitter austerity down the throats of those that have gotten into too much debt.
But this solution is not going to be implemented without a massive amount of pain.
In fact, this solution is going to make a massive financial
collapse much more likely. The following are 17 signs that the European
financial system is heading for an implosion of historic
proportions....
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