The Beginning Of The End
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We Are Watching The Greek Banking System Die Right In Front Of Our Eyes

Money is being pulled out of Greek banks at an alarming rate, and if something dramatic is not done quickly Greek banks are going to start dropping like flies.  As I detailed yesterday, people do not want to be stuck with euros in Greek banks when Greece leaves the euro and converts back to the drachma.  The fear is that all existing euros in Greek banks would be converted over to drachmas which would then rapidly lose value after the transition.  So right now euros are being pulled out of Greek banks at a staggering pace.  According to MSNBC, Greeks withdrew $894 million from Greek banks on Monday alone and a similar amount was withdrawn on Tuesday.  But this is just an acceleration of a trend that has been going on for a couple of years.  It has been reported that approximately a third of all Greek bank deposits were withdrawn between January 2010 and March 2012.  So where has all of the cash for these withdrawals been coming from?  Well, the European Central Bank has been providing liquidity for Greek banks, but now it has been reported that the ECB is going to stop providing liquidity to some Greek banks.  It was not announced which Greek banks are being cut off.  For now, the Greek Central Bank will continue to provide euros to those banks, but the Greek Central Bank will not be able to funnel euros into insolvent banks indefinitely.

This is a major move by the European Central Bank, and it is going to shake confidence in the Greek banking system even more.

There are already rumors that the Greek government is considering placing limits on bank withdrawals, and many Greeks will be tempted to go grab their money while they still can.

Once strict currency controls are put in place, the population is likely to respond very angrily.  If people can’t get their money there is no telling what they might do.

We are reaching a critical moment.  Many fear that a full-blown “bank panic” could happen at any time.  The following is from a recent Forbes article….

The pressing problem isn’t a splintered legislature that may balk at delivering the reforms that the IMF and European Community are demanding in exchange for the next tranche of bailout money. It’s a disastrous, old-fashioned run-on-the bank. “For a year, Greeks have been sending their savings from Greek banks to foreign banks,” says Robert Aliber, retired professor of international economics from the University of Chicago. “Now, the flood has reached a crescendo.” Indeed on Monday alone, outflows from the Greek banks reached almost $900 million.

These banks would have collapsed already if not for the support of the European Central Bank and the Greek Central Bank.  This was described in a recent blog post by Paul Krugman of the New York Times….

But where are the euros coming from? Basically, banks are borrowing them from the Greek central bank, which in turn must borrow them from the European Central Bank. The question then becomes how far the ECB is willing to go here; is it willing, in effect, to lend enough money to buy up the entire balance sheet of the Greek banking sector, given the likelihood that this sector will be left insolvent by Greek default?

Yet if the ECB says no more, Greek banks stop operating — and it’s hard to see how they can be restored to operation except by ditching the euro and using something else.

That is why the announcement that the ECB is cutting off funding was so dramatic.  The ECB is starting to pull back and that is a very bad sign for the Greek banking system.

For the moment, the Greek Central Bank is continuing to support the Greek banks that the European Central Bank is no longer providing liquidity for.  A Reuters article explained how this works….

The ECB only conducts its refinancing operations with solvent banks. Banks which fail to meet strict ECB rules but are deemed solvent by the national central bank (NCB) concerned can nonetheless go to their NCB for emergency liquidity assistance (ELA).

But this emergency liquidity assistance is not intended to be a long-term solution as a recent Wall Street Journal article noted….

The ECB’s emergency-lending facility isn’t intended as a long-term fix. National central banks must get approval each month that they want to let their banks access the facility from the ECB’s governing council, which can veto use of the program.

If Greece installs an antibailout government that reneges on its austerity promises, it would almost certainly be cut off from ECB funding.

The truth is that we are heading for a financial tragedy in Greece.  If the flow of money out of Greek banks intensifies, the Greek banking system might not even be able to make it to the next election in June.  This point was underscored in an article that was authored by renowned financial journalist Ambrose Evans-Pritchard….

Steen Jakobsen from Danske Bank said outflows are becoming unstoppable, not helped by open talk in EU circles of `technical’ plans for Greek withdrawal.

“This has a self-fulfilling prophecy built into it and I don’t think we can get to June. The fuse is burning and the only two options now are a controlled explosion where Germany steps in to ensure an orderly exit, or an uncontrolled explosion,” he said.

So what should we expect to see next?

Well, James Carney of CNBC says that he believes that it is inevitable that Greece is going to have to implement currency controls in order to slow the bleeding….

It looks increasingly likely that Greece will have to implement controls to prevent capital flight and a banking collapse. To my mind, the only real question is when this will occur.

The widespread talk about Greece possibly leaving the euro zone is likely to trigger withdrawal of bank deposits and other financial assets, by those who fear they might be redenominated into a drachma that would be worth far less than the euro.

The Greek government may soon announce a limit on the amount of money that can be withdrawn on a single day.

The Greek government may also soon announce a limit on the amount of money that can be moved out of the country.

Those would be dramatic steps to take, but if nothing is done we are likely to watch the Greek banking system die right in front of our eyes.

A Greek exit from the euro seems more likely with each passing day.  Such an exit would have a devastating impact on the Greek economy, but it would also dramatically affect the rest of the globe as well.  The following is from a recent article by Louise Armitstead….

The Institute of International Finance has estimated that the global cost of a Greek exit could hit €1trillion. When Argentina defaulted in 2001, foreign debtors lost around 70pc of their investments.

That is a big hit for such a little country.

So what would it cost the globe if Spain or Italy left the eurozone?

That is something to think about.

Meanwhile, the United States continues to steamroll down the same road that Greece has gone.  According to the Republican Senate Budget Committee, the U.S. government is currently spending more money per person than Greece, Portugal, Italy or Spain does.

We are spending ourselves into oblivion, and we are heading for a national financial disaster.

Unfortunately, most Americans are totally oblivious to all of this.

Instead of getting educated about the horrific financial crisis heading our way, most Americans would rather read about why Jennifer Lopez is leaving American Idol.

But those that are listening to the warnings will be prepared when the storm hits.

Things in Europe look really, really bad.

You better get prepared while you still can.

  • Paul M

    Michael,

    Visited U-Tube and I noticed that the Maroon 5 Payphone song has 17 million views. While some videos about the our economy only have a few thousand views.
    Most people are in an entertainment induced coma. Thanks for writing the article.

    • Paranoid

      According to U-Tube the most watched video in the world is blowing up a dead whale.I’ve seen it 3-4 times myself, Three Stooges “Niagara Falls” is also way up there. Truthfully all things considered these issues on banking have a lot in common with both of them. And they way more educational

  • Matt

    Michael, why don’t you think the markets are responding the way one would expect them to? With all of the bad news coming out of the EU the markets should be falling like an avalance, as investors are selling to avoid taking a haircut. Plus, I wonder why gold and silver are tumbling into a bear market. Imo, it appears that market manipulation is taking place; however, I have been known to be wrong in the past!

    • Michael

      Matt:

      Without a doubt the financial markets are highly manipulated.

      But at some point I do think that we will see a huge decline in the U.S. stock market.

      Michael

    • sos

      money is being moved from gold and silver into u.s treasuries because it is considered more safe,

      • propel7

        ***********! Who r u trying to throw in ur pile PIEFACE?! LOL US treasuries? HAHAHAHAH. A FOOOOOOOOOOL would believe ur stupidity and an even greater one would invest in ANY kind of FED or WORLD bank NOTE or FAKE paper. PFFFFFT. We know who u r. Hit the road son of a Pollo. ******************. Enough of your fools game. Get in your lake of fire and destroyed FOOL. Bring it on! It only means your days are numbered and DONE! Good riddance PUKE! Elites got about 8 years left and half of that will be in a state of shock. Afterwards will be a perpetual state of shock! HAHAHHAHAHAHA Jokes on you! Thought u would piut it on the world and mankind but it is you who will be destroyed….BOY!

        • propel7

          When it aint backed by the FED and is backed PURELY by the U.S., then we will talk about what is REAL. …DOOF!

    • Graham

      Matt:-

      There is no question that massive market manipulation is taking place. Re Gold and Silver, I believe you may see an upsurge in prices from tomorrow onwards as people once again return to “metals”. Gold may have bottomed out yesterday. India should also be returning to the market in light of a recent incentive.

      When the US currency weakens a bit, expect to see a healthy return to Gold, especially with the threat now over the EU. Gold rose 40 points today and stabilised fairly early. Watch to see if it breaks through $1580 tomorrow then $1600 and $1630 in the next week.

      If so, a bull run may be back on the cards as the market looks ripe for buyers after so much recent selling. Just my 2oz’s!

  • DMyers

    We are about to see the repeat of history in an accelerating framework of time. Reference Terance McKenna, Ian Lungold, and his protege Ivan Stein. The neo-fall of Greece will usher in the fall of Italy and the UK. And finally, the greatest collapse of them all, the USA, the last great domino of time and civilization,the end of history.

    • David

      Excellent answer; few people get the big picture. Do you write and/or publish anything?: would love to hear your thoughts, opinion and enlightenment on where this is all heading and what comes next..

      • Steve

        Just my two cents but I’m guessing this is becoming another reason for another large war starting in Europe, possibly by Germany who will have to absorb the impact of these countries not repaying what they owe and departing Euro Zone. Germany starting a war isn’t unheard of. Of course, many of us suspect what the outcome of such a war would be.

  • john

    What can we do to prepare?

    • Scott

      Move your money into gold and silver bullion. Buy guns and ammo and food you can store.

  • Wilson

    An outstanding and sobering article. I try to pay everything in the first few days of the month, electronically, then I pull the cash out leaving a marginal balance. I don’t trust the banks, more importantly I don’t trust the Federal Reserve System.

    • Zak

      Wilson,

      If you dont trust the federal reserve then how can you trust the $$$. I know they are supposed to be two different entities ($$$ and federal reserve) but in reality the reserve can print all the $$$ they want. Hence they appear to me to be the same.

      Zak

      • Wilson

        I never said I trusted the $$$. I don’t trust the federal reserve system. That includes the money as well as any other goods, services, and products produced by the system.

  • Rodster

    This is why socialism sucks. This is what happens when Governments make promises they can’t keep, great pensions and early retirement. You create a society that’s paid not to work. And the bigger problem is the Government runs out of nipples to breast feed a Nation.

    This is why we are next because the liberal, socialist of this Country have embraced European socialism. Without question liberals are the dumbest individuals on the planet because they have seen this play out over and over and they keep trying to make it better.

    Further proof why Liberals are dumber than Conservatives. Will Smith in a French interview was told the French Gubmint there wants to tax wage earners 75% if they make more than 1 million Euros. Well he freaked out. But this is the same idiot that’s championing the President to be taxed more. It’s a good thing the moron doesn’t live in France. http://www.businessinsider.com/will-smith-freaks-out-at-franois-hollandes-proposed-tax-rate-2012-5

    • Believer

      You need to get it into your head that this isn’t about red versus blue, the banks control both of them anyway. You are just buying into their plan to turn people against each other so they are distracted from the real issues.

    • Gay Veteran

      hey Rodster, get a clue, the Republicans and Democrats are 2 sides of the same coin

      • Mal R.

        Aren’t you the one that keeps posting it’s all republican’s fault with your back door pal Gary?

        • Gay Veteran

          uh, NO

  • Bill

    Your real concern about the almost dead canary has got to be the USA, Next watch the Dollar Index climb until after the election when the reality of our debt sets in and another canary bites the dust.

  • salvadordaly

    Everyone here needs to pay close attention to what goes on over there so we can make plans for our dollar demise here. Learn from mistakes in euro land to perfect our play book here. Get your own strategy together for our economic collapse. Keep prepping!

  • 007

    Don’t worry, they will just print a bunch more money and funnel it to the insolvent banks and governments. The bankers and worthless government beuracrats will get fatter and fatter. Prices will creep up on everyone else. This can and will go on for years.

  • mondobeyondo

    Coming very soon to a country near you…

    Greece is only the preview. The feature presentation will be coming up soon. It’s worth the wait… I guess. Want some popcorn?

    • xander cross

      Can I get butter with that popcorn? Or some Mike and Ikes? This is going to be long movie.

  • mark

    At what point will our own banks have the greek problem? We can print and hand out cash to keep the banks liquid. That will create inflation of the kind I sure don’t want to see. Where will all of the cash come from if many withdraw their savings. Most of our banking involves transfering numbers from one account to another. If you go to your bank and want several thousand in cash they would like to know your needs in advance so that they can have the cash on hand. Our system is not set up to cover a run on the banks.

  • Sam

    Michael is it wise that people in U.S. should start withdrawing from the banks because of what is happening in Europe?

    • Michael

      Sam:

      I am not worried about U.S. banks right now.

      But I am worried about banks in Greece, Italy, Portugal, Spain, etc.

      Michael

      • Gay Veteran

        American banks are bankrupt. They count worthless mortgages as being good 100 cents on the dollar

        • American Veteran

          American mortgages are not worthless- because the houses are not worthless. Unless you’re in Detroit of course (the liberal socialist dead city)

          • Gay Veteran

            well is IS a problem when the mortgage is for $200,000 and the house is only worth $100,000, which means that the bank in reality has lost $100,000 of its capital

  • Colin

    Instead of getting educated about the horrific financial crisis heading our way, most Americans would rather read about why Jennifer Lopez is leaving American Idol.

    “Last and certainly least on my list of countries to rant against is the United States. This place is an amalgamation of the worst aspects of every other country. It’s a financially-fragile, energy-dependent, consumerist-minded, generationally-entitled, politically-fractured, demographically-fracked imperial police state. We may make it to November elections in relative peace just because our crony political establishment and media spin machines will pull out every trick play in their playbooks to keep the mind-numbingly ignorant population with blinders on until then. After that, all bets are off.”

    http://theautomaticearth.org/Earth/planet-earth-fubar.html

    (I changed one word to frack. I heard this word on the sci-fi show “Eureka”, and, as “Eureka” is a family program, I think this word is acceptable for a family site. The unchanged version is on the web site above.)

    • Kathy Smith

      Thanks for the lead very interesting reading.

    • GaryToo

      Ashvins rant was great. But he did get it wrong about Australia dodging the property bubble. I am an australian property investor and i know too well values are steadily dropping. a tyre as an analogy, we didnt have a blowout but we have a puncture. a house worth 350 at the height of boom now worth 250K

  • davidmpark

    So, this is the last gasp before the calm. Then the torrent comes to try our souls.

    Let it come.

    • GaryToo

      actually trying to prep while it is in slow motion and knowing it can rapidly escalate into fast forward at any time is trying on the soul.

  • Hans Meier

    Americans are just a bunch of stupid animals easy to manipulate and subdue. The sooner the economy collapses the better, so these brutes will finally learn not to live beyond their means.

    • Kev

      And we in the crapfest that is Europe haven’t done exactly the same then?
      Doh.

  • KYTim89

    So if the entire EU collapses what can we expect to happen as a result?

  • Highspeedloafer

    Michael, Recently your warnings have become more dire. In your mind, is a US collapse going to happen much quicker than you had thought , say a year ago?

    • Michael

      That is an interesting question.

      I think the next 3 years area going to be bad, but it won’t be the end.

      A lot of suffering is ahead.

      Michael

      • Marc75

        Suffering yes, but not for Wall Street banks that are best buddies of Chuckie Schumer, Barack Obama, Mitt Romney etc… for them it will be eternal socialism… backdoor bailout after backdoor bailout…

      • K

        Michael, I agree the next 3 years are going to be bad. My question is, you say it will not be the end. The end of what? The end of the world? I agree, it will not be the end of the world. The end of the USA, at least in any recognizable form, I am not so sure. There are a lot of unhappy people out there, talking about violence. And that is in a Country, that has not gotten that bad yet. If they represent just 1% of the population. That is still 3 million violent crazy people. Like most people I like to be right. Not this time.

        • GaryToo

          I saw a clip of Dr r paul answering a qusestion while signing autographs, they asked him what he thought about the holiday camps being built, answer “well theyre expecting trouble”.

  • chiller

    Who else but a banker would cobble together a system of finance so lame, that one tiny country can have such a devastating effect on a continent and the world?
    A proof positive lesson for the history books to NEVER EVER let bankers into such a position of power ever-ever again, because? All they know is taking other people’s money….also known as “GREED”…

    • Miami

      You believe bankers have the corner on greed? How about the Greek people themselves? They are the ones that voted in the politicians that implemented their now defunct socialist paradise. How easy it is to shift the blame.

      Votes have consequences, in Greece and America. You might want to remember that the next time you’re in a polling booth.

    • Mal R.

      “All they [bankers] know is taking other people’s money….also known as “GREED”…”

      Not so much. No banker TOOK anyones money from them. No banker forced you into a mortgage, forced you into a car loan, forced you to charge all that crap on your credit card, forced you to take student loans, forced you to do ANYTHING. Only Government and armed robbers (but I digress) TAKE money.

      • Gay Veteran

        eyeroll, no, the banker only committed fraud by lending money to people they KNEW could not pay it back, then selling mortgage backed securities to people who thought the underlying mortgages were good

  • grandpa

    Bankers are like ravens waiting for death and snatch every morsel of evidence its prey ever even existed. leave them nothing..

    • Miami

      Sure grandpa, until you need to buy a house, a car, etc. Then bankers come in handy. I know, you believe money should be loaned interest free. I’m sure you’ll encourage your own grandchildren to work for free administering these free loans. Or maybe you prefer the government run the banks. Never seen any corruption or greed in city hall, grandpa?

      This anti-banker mentality amuses me. Banking is an essential element of society. Wring your hands all you want, their will always be someone out there loaning money and there will always be someone needing a loan (and willing to pay for it).

      • American Veteran

        Amen! These class-envy clowns are the most GREEDY people I have ever seen. They care about nothing but themselves, and want to CONTROL everyone else. And they’re too stupid to realize they are being played by authoritarians in government the whole time. It makes me very sad, but I know that with all of this turmoil in the world, at least we are a little bit closer to the Lord’s glorious return. Let’s make sure we’re not whining for a government handout or otherwise putting our faith in man when that day comes.

      • Mal R.

        “This anti-banker mentality amuses me.”

        I’m with you on that.

        • Gay Veteran

          the banksters have become nothing but parasites

          but they do appreciate your boot-licking

  • markthetruth

    Plain and simple
    Front and Center of the World ” Illusionist The Fed and Central Banks ”

    1st. The Thought and plan. (Not Much)
    2nd. The Construction of it. (years of work , bubbles, ponzi schemes ,ext)
    3rd. The Build up (Everyone living it up and partying until the show)
    4th. The Show (all the clueless show up to watch)
    5th. The Pitch “We need to make a huge pile of money on the stage , then we will make it triple . Who has any money everyone raises there hands and they collect it and put it on stage. (The Final Ponzi Scheme )Everyone’s mind(boy what am i going buy with it when i get back triple of what i gave.).
    6th The Distractions (while they collect and pile the money one stage , hyping it up, talking Hollywood , dancing with the stars, jay lo , kartrashings , octomom , and the rest.)
    7th The Smoke and Mirrors (while they remove you money and insert the paper)
    8th The Show of the stack of billions that will turn into trillions.
    9th The lowering of the drape. (getting anxious)
    10th The ripping of the Drape away “Its all gone Instead” There all dumb founded . They start chanting “where’s are money” Hoping there’s one last act ,while the crooks disappear. But that’s it , they been had and storm the stage… and set the place on fire.

    The End

  • Paul76

    Jennifer Lopez is leaving Idol???? Seriously, I believe you are right that the snowball effect is going to be picking up steam. And yet, the talking heads on TV continue to say that Greece will have NO effect on the rest of Europe, let alone the U.S.. They’re totally wrapped up in the Facebook IPO. It’s like the house is on fire and they’re worried about opening Christmas presents!

    They seemingly are paying no attention to the fact that while gold prices have been dropping as big buyers scramble to sell real assets to gain liquidity, China, Russia and all those “independent” third world central banks have been gobbling up physical bullion and taking it home. Which commentators have noted that the Bundesbank is telling the Bundestag to quite bothering them with petty issues like, “where is OUR bullion and why haven’t you audited what you’ve been storing with the Fed??”

    It’s just frustrating to watch people go about their daily business while the world unravels–I’d say before their very eyes, but nobody is looking! I’ve made my preparations, so I went golfing yesterday. Who knows how long until the chaos sets in and such “fun” will be a thing of the past?!

    Keep the REAL news coming Michael. It gets harder to find every day!

    • GaryToo

      I have noticed trying to talk about the world economy is as rude as loudly farting in polite company. “oh they have factored all that in…whats all this doom and gloom…you are so negative” Well if my business partners who now avoid talking to me are watching the news right now: another 32 billion dollars wiped off the ASX in response to greece and spain.

      • GaryToo

        btw we have less than 32 million people, so its a loss of more than a billion dollars for every man woman and child. That spells contraction, goodbye projected budget surplus, and tough times.

  • http://www.buyinggoldbars.co.uk John

    How long this Greek cash machine purge can continue before irrevocable collapse is anyone’s guess.

  • Kelby

    LOL, i’m listening to the Eagles’ “The Greeks Don’t Want No Freaks” as im reading this! It’s so sad…The Greeks are going through the worst time of their lives, i hope they have guns!!

    • GaryToo

      No the cops and army have guns. Usually in a situation like they have now with a power vacuum, major parties defunct army takes over or army decides which party wins. THERES MY TIP.

  • Lodewijk Hof

    Interesting article. Im wondering when it happens as it is then a good moment to pick up some investments.

    • GaryToo

      thats what I thought in 09 as did a lot of others, now were left holding the bag, dont make the same mistake mate, this cycle is the last go round.

  • Evie

    The reason greece gets picked on is they are not part of the stock market. Britain & japan are 50%. The other euro nations such as italy,germany etc. make up less than 10% but at least are on the stock market.

  • ken nohe

    The Greek tragedy is just entering a crucial phase indeed. Considering the leverage of banks, it is just a matter of weeks now before one or several go belly up. At that stage, it would be surprising if limits are not implemented on capital transfers in Europe. The pressure on Spain and Italy will then grow exponentially for the contagion to finally spread to banks all over the world thanks to derivatives and the freezing of the interbank market. 2008 all over again?

  • JH

    There is no doubt we are getting close to the big one. Like the rich man in Luke 16 many are slow to listen or refuse until it is too late. This situation in Greece makes it look like the financial situation is on the brink of some very dangerous to the whole economic system. If Greece goes down and it spreads – Wow!

    What about this run on Bankia in Spain? Is this a possible sign, the Greek Bank runs are spreading to other countries? Make you wonder what’s next. Thanks for the research and job you are doing.

  • Washington

    Feb 1, 2012 A huge crowd gives Ron Paul a hero’s welcome at at the Nevada kick off event at Green Valley Ranch Casino in Henderson, NV on January 31st 2012. During his speech Dr. Paul touches on the election results from the Florida Primary that was held on the same day. After the speech, he greets supporters, signs books and shakes hands.

    http://www.youtube.com/watch?v=G7Pt8Va1vbE&feature=player_embedded

  • Syrin

    Instead of slashing spending to a “draconian” level of lets say 15% of GDP instead of the 24.3% it is currently (thanks liberals and GARY), they’d rather raise taxes in COMPLETE DEFIANCE OF HISTORY. So they would rather make us MORE HOSTILE TO BUSINESS than we already are, if that’s possible since we already have the highest corporate taxes on the planet. Hey GARY, perhaps we should do what SWEDEN did, what Canada did, what NJ did, what Coolidge, Kennedy, Reagan and Bush did and that’s LOWER taxes and LOWER spending as it is a PROVEN FORMULA FOR GROWTH! Nah, instead, we’ll make it so that people would rather renounce their citizenship rather than pay the punitive taxes our nation has set up for the successful. Heck, Chuck Shumer now wants to construct a concrete wall around the country and line it with armed guards to keep people from fleeing. See the DEMOCRATS ARE TYRANTS. It’s the end result of liberalism. When people do what THEY want, they FORCE them to or kill them. That’s the way liberalism HAS ALWAYS ENDED UP.

    But what do you expect. These are the same IDIOTS who side with the HALF of the country that pay NO taxes then tell us that the 5% who pay 86% of ALL taxes aren’t paying their “fair share”.

    In order to be a liberal, one must have an inability to access cerebral cortex.
    Liberalism – destroying nations for centuries

    • Miami

      Well said, Syrin. Liberals, or better yet, malcontents, will always be part of humanity. These are the people that have wrecked their own lives through foolish decisions and then blame their own inadequacies on those that live more responsible lives. They will always be with us. When these takers outnumber the makers than society collapses. Greece is just the first, the opening act, of what should be an interesting morality play on the evils of socialism.

      Let the Greeks enjoy their retirement at 50, as they wait in line for food handouts from C.A.R.E.

      As for Americans, we are at the 50-50 takers/makers tipping point into the welfare abyss with very dark clouds on the horizon. Prepare.

      • GaryToo

        what foolish decisions, holding out the left hand instead of the right? Sorry bit extreme.

    • Marc75

      Economic growth era for the western world is over. The financial system of the ‘west’ is unsustainable and if it hadn’t been for central bank moneyprinting and government overspending there wouldn’t have been any economic growth anywhere in the ‘west’ in the last decade. The system is running on fumes, markets now addicted to federal reserve/ECB handouts and they need them with increasing frequency just to prop them up at the current levels.

      Perpetual growth is impossible anyway. And population growth (that bailed out the unsustainable model for half a century) won’t work anymore either as we’re overconsuming just about every resource on the planet.

      The decline of the west started somewhere in the 2000s and the best part about it, it is utterly unstoppable no matter what the politicians and central bankers do.

    • Gay Veteran

      hey Syrin, the Federal debt started exploding under Saint Ronnie

      we’re headed towards another Gilded Age thanks to Republicans and Democrats who have been BOUGHT by the top 1%

      • Mal R.

        *yawn* Perhaps you preferred an unstable world where the Soviets and US operated under MAD? Debt also exploded under FDR. The point is that your class of politican has been operating under the Cloward and Piven strategy since the 60s and wont allow debt to be PAID OFF any more like it was after WWII.

        Sure they are both corrupt and operate to make themselves money and gain more power, but can you explain why you continue to support marxists like Obama that will seal the deal to end the most stable, longest lasting constitution in world history? You do realize that slavery isn’t just black people picking cotton, right?

        • Gay Veteran

          eyeroll, debt exploded under FDR because we were fighting the Nazis and Japan

          you do realize that slavery can include being a debt slave to the banksters

    • GaryToo

      sure thing, um um um whats his name. There sure told you!

    • Gay Veteran

      “side with the HALF of the country that pay NO taxes ”

      flat out LIE, people pay an incredible variety of taxes, like sales tax, social security tax, phone tax, gas tax, etc.

  • Michael

    This existence totally sucks ****************.

  • Alex

    ‘There are already rumors that the Greek government is considering placing limits on bank withdrawals, and many Greeks will be tempted to go grab their money while they still can.

    Once strict currency controls are put in place, the population is likely to respond very angrily. If people can’t get their money there is no telling what they might do’

    The problem is there’s not yet a fully functioning government who can take such an action. Even if there was, the panic would overtake the reaction of the government. Personally I expect a greek bank default within a week. Even if there was a govenment that could vote such a law to limit the amount that could be withdrawn from a bank, it would take more than a week.

  • http://TheEconomicCollapse Darwood

    The worst things get the more ripe the world will become for the rise of world leader. They will need someone with all the answers to the worlds problems. The Bible calls this individual the anti-christ, the man of sin, etc. Some how there will rise a confederation of ten nations from the geographical location of the old Roman empire which is modern day Europe and parts of the Middle East. From these will rise a ruler like the world has never seen. The current events we see today in Europe and throughout the world tells me that day is near. More importantly this tells me that Jesus is coming soon and “of His kingdom and peace there shall be no end”.

  • JJ Allen

    Thanks for the article. Politicians, investors and the general public are in such denial about the effect of sovereign debt that we must protect ourselves with gold and silver. See an article about this http://wp.me/p2esYO-5H

  • http://worldendsat5newsat11.blogspot.com Roberta Lamb

    Yea we have a front row seat to watch a country expolde or is it implode. What people do not realize is, what they are watching is their own future. But for us it will be much MUCH worse. Greece does NOT owe 211 trillion dollars like we do. Greek banks are not all involved with derivatives like ours are. Greece can fall back to the Dracma, what do we fall back to?
    It’s gonna be REAL bad here, and soon!
    See how to survive the coming Economic Apocalypse…
    DO NOT (just) buy Gold & Silver as YOU CAN’T EAT GOLD and SILVER WILL NOT KEEP YOU WARM & Diamonds and Platinum will NOT protect your family.
    See a Serious and Real FREE survival plan for you & your family at:
    http://surviving12-21-2012.blogspot.com

    • GaryToo

      Im confused did u have a *********************** tony? why not just change to toni

  • http://www.magnifiedview.com Yoda

    Superior report Economic Collapse:

    It’s all Greek to our pillar of tapioca President Barrack Hussein Obama.

    Our great leader is making a concerted effort to bring a communist revolution to your neighborhood.

    Right on Economic Collapse – WRITE ON!

    Respectfully, Yoda

    P.S.http://www.magnifiedview.com/2011/10/18/occupying-wall-street-style-uprisings-and-the-arab-spring-revolutions/

  • Rodster

    And now bank runs have spread to Spain. Welcome to socialism 2012. :)

    Spain into recession amid fears of eurozone bank run
    http://news.yahoo.com/spain-slides-back-recession-first-quarter-073134907.html

    Spain tumbled into recession and European stock markets and the euro fell Thursday as Greece installed a crisis government to tackle its crippling debt, EU leaders prepared for talks and analysts raised the spectre of a run on eurozone banks.

    “Markets are worried about eurozone bank deposit runs and an escalating banking crisis,” London-based VTB Capital economist Neil MacKinnon told AFP.

    Heavy withdrawals of deposits have been reported in Greece and Spain, and top European Union leaders were to hold a videoconference later in the day.

  • Graham

    Sorry folks, time for another rant from Scotland :)

    Aside from all the great material you are presenting Michael, the link below contains one of the simplest explanations I have seen to date on what drives the Greek, EU, US debt crisis and provides what I strongly believe to be sound advice on how to deal with global bankster enslavement, especially when it comes to destroying sovereign nations. The people have to stand up against it.. completely united!

    The lies that are coming out of the “twisted minds” in power have become epidemic. What and who are they hiding? Note the level they are all connected. The trail always leads straight back to the banking system, yet little to nothing has been done about it since 2008 to stop it. Why? So what is the true “agenda”? People must ask this question.

    Look at Iceland to see what the people can do. Greece is heading down a similar path right now, albeit as a member of the EU. The rest in the EU are bound to follow. People are not helpless, they just need to recognise their power and group together properly then ACT! It’s going to be a very busy summer indeed, everywhere. Watch for the likelihood of some major “false flag” operations to refocus the attention of the masses so the elite can complete their agenda behind the scenes. More lies will be told.

    Watch JP Morgan and HSBC very closely. The fraud being exposed just now by insiders is astounding and the mainstream media are not providing the facts, if any at all. Yes, the derivative problem is looking closer to complete collapse but the media don’t like to use the “derivative” word in order to keep the sheeple blindfolded and distracted by their petty positioning and meaningless arguments (divide and conquer).

    Time is running out to try and understand the full picture before the US elections. Romney is a puppet, a crook and a fraud and Obama is in the “cabals” back pocket, as can be witnessed by all the Executive Orders that have been signed. Those Orders are clearly not in the interests of the people, so what is their true purpose? Who benefits? The US appears to be one step away from Marshal Law. Why?

    Forget the political dogma, nonsensical divides and anything that focuses your attention on political nonsense. Vote for the person who will reinstate your Constitution backed by Common Law and will attempt to abolish the Federal Reserve global banking system. That’s for starters! And by the way, Ron Paul has NOT dropped out of the race. He is focusing on “Delegates” and is extremely active behind the scenes. It appears to be working a treat as more are catching on to the true picture of what the up and coming election results mean for the future of the US and elsewhere.

    The people have the best chance ever, right now, to change the future back to something that could be called “sane and moral”. Corruption must be rooted out at every level, otherwise the future isnt looking too bright. Do you want to be ruled by a small group of elite Luciferian psychopaths whose agenda is to RFID chip the “surviving” masses in order to have total control over them?

    Such nonsense flies right in the face of natural and universal law. Don’t let it happen! It is clearly not what we’re on this planet to achieve. Realise what is being done to completely control the human mind (food and drink additives and technology etc). It is preposterous, but few seem to know any better as the “grand illusion” has run so deep for hundreds of years, if not more. Where has rational thinking and analysis gone? The problem evolves around the human “ego”.

    Learn what the ego is before it causes any further destruction. Destroy “it” instead. “It” thrives on greed, fear, power, destruction and utilises the dividend & conquer principle. “It” is an illusion of the mind. Nothing more. It is “left brain” dominant. Learn to transcend it and awaken to conscious reality. Use both hemispheres to obtain “balance”. You will know when you experience such balance. The key lies in maintaining it.

    Whilst the “ego” can never become aware of consciousness, consciousness CAN become aware of the ego with the right training and discipline! Learn to “observe” your thinking and when necessary, prevent the follow up action as it may be highly destructive. Those who understand the process of meditation, or “focused prayer” as some may refer to it, will understand this already. Calm and emphatic people?

    The ego is likely to attack the process left right and centre until you get beyond the level where the ego functions. The mind will then experience a tremendous sense of peace. That is where a persons true power lies, nowhere else. Prove it to yourself by putting what I say to the test. The results will likely astound you if the process is carried out correctly.

    It is called “conscious awakening”.

    … rant complete.

    Extract:-Why should the Greek people be financially destroyed and rendered destitute by forced German and Brussels EU austerity measures and more loans designed only to pay the interest on the debt to the big banks? What if the banking and media establishment are dead wrong about nations withdrawing from the Euro like they have from the beginning of the crisis? I suggest a strong economic recovery is the likely result rather than depression as forecast by experts working for the banks that have enslaved Greece.

    Why should the Greek people be financially destroyed and rendered destitute by forced German and Brussels EU austerity measures and more loans designed only to pay the interest on the debt to the big banks? What if the banking and media establishment are dead wrong about nations withdrawing from the Euro like they have from the beginning of the crisis? I suggest a strong economic recovery is the likely result rather than depression as forecast by experts working for the banks that have enslaved Greece.

    Greece: Dump the EU Now For An Economic Recovery:-
    http://www.thedailybell.com/3892/Ron-Holland-Greece-Dump-the-EU-Now-For-An-Economic-Recovery

  • Old Man

    After a few years of ups & down with the rest of EU, Greece worked out a plan a few weeks ago. Things settled and await for an election to certify the deal.

    But Greeks, true to past behavior, elected no government, leaving the political parties to work out a coalition, which they did not. That means the financial deal with the EU is off.

    In their last chance for a deal, the Greeks chose instability and irrationality.

    Therefore, Greece deserves all that will be coming. Because they have rejected their responsibilities as part of the Eurozone, and responsibilities to their own country. It is the act of a people who defeats themselves.

  • Bryan

    micheal at the rate things are going to you really think we will make it past this year? everywhere is getting hit just read an article that Kuwait is having problems to!

    • Michael

      Yes, we will definitely get past this year. The economic collapse is going to play out over time.

      But that doesn’t mean that the next few years aren’t going to be incredibly painful for many.

      Michael

  • Bryan

    micheal i’ve even noticed the target store i work at has not been as busy as it usually has been since i started working there for the past 2 yrs is this a start perhaps?

    • xander cross

      I noticed that as well and also, how Target promote not giving overtime to its employees and increases in prices.

  • McKinley Morganfield

    I think what we are witnessing is initial stage of the unraveling of the global financial system. It appears Greece can no longer be propped up simply because it is politically impossible. This will indeed spread to the other PIIGS if Greece exits the Euro. Japan and France will be the next to fall, followed by the UK and then the USA. The BRICS are going to go their own way and pull as much of resource rich Africa along with them as they can by convincing nations to abandon the USD. Bernanke will attempt to sooth the crisis by flooding the banks with cash, both real and digital, and this will be the final straw. We will see hyperinflation followed by deflation. Chaos will grow exponentially.

    My unsolicited advice is to buy food with a long shelf life, determine what you need to have to purify water in accordance with your local situation, and hold onto your hat. Once this unraveling begins it will accelerate rapidly. If you live in a metro area and can not leave you have my pity.

  • Paul

    Please someone give me a direct answer to this question. With money becoming more worthless, what should one (here in the U.S.) do with whatever money they now have in banks and stocks? Cash out now? Into dollars that are really backed by nothing? Cash out and buy land? It’s a serious question.

    • TX4Life

      I think it’s hard for anyone to really answer this question because everyone is asking the same. I sure wish I knew. Every day I try to figure what would be the best thing to purchase that would retain value. Land is always a good idea I think but requires maintenance and taxes. Gold and silver, food, ammo, and good quality items like tools that you will use and will last a lifetime. Also, I think anything you can do to make your home more energy efficient to hedge against rises in energy costs is a good idea. We downsized homes and got out of debt to hedge against the rise in property taxes that is certain to come….

    • Mal R.

      I’m not sure the market can be trusted now, given how manipulated it is on the front end and the corruption on the back end with things like MF Global and the GM bailout. Look up Ann Barnhardt and claw back hypothecation.

      As for me, I cashed out of the market in 08. I did it the wrong way tho. There are ways to dump your retirement money into land, without reaping the IRS whirlwind. Look into it, as for the value of the dollar, it’s likely going to get somewhat better before it falls off the cliff.

    • mondobeyondo

      It’s really hard to say. You can cash out and buy land, but with the way housing prices are going, that could be a loss. Or you can buy precious metals (gold is probably the safest bet). But that is also risky.

  • Erin Tarn

    Run on US banks! The system is corrupt.

  • Tatiana Covington

    It will be replaced with something else. The sun will rise and shine tomorrow right on schedule, as if nothing whatever had happened.

    It’s not nuclear holocaust or alien invasion or the fall of Atlantis.

    It’s just a banking system.

    • Paul

      Thanks, i feel much better now.

    • GaryToo

      credit/finacing is the oil/lifeblood of our system, as it dries up the economy withers away. State of emergency, all resources nationalised for WAR, twar to nationalise all remaining resources. No biggie.

      • Tatiana Covington

        Greece is no threat to anyone. So its banks go under. So what? Just hit the reset button! Bankruptcy. Start over!

  • David M

    Even if the Eurozone financial problems don’t cause a global collapse. We in America have a shrinking work force and ballooning government expenses at most levels. Sure there’s some towns, cities, and states cutting their budgets. But they are a small minority. Look at California with a $16 Billion budget shortage this year.

    Pensions all over are under funded. Infrastructure is aging and failing. $50 Billion or so trade losses every month. Working versus non-working workforce is shrinking. Meaning less to support those on government entitlement programs. Not to forget the increasing national debt. AND not to forget that our saviors are more often not buying our treasury bonds.

    We are in a serious decline.

  • THE MESSENGER

    Get on with it guys ! 1776 re-loaded !It was the banks the first time round,right?I’am in Australia and the world is not watching as much as you might think (occupy). Most people don’t give a @#$# !Europe is stuffed and America is next.You fantastic people in America are the only hope you have.The money system is finished.Your govt has failed you all.1776,get on with it already.Wake up!!!

  • peter1954

    What will happen?
    There will be a conjunction between a total and complete economic collapse just preceding the biblical outcomes many now believe. Nothing will stop this calamity. The only preparation is a spiritual one. All materialism will be useless i.e. gold, housing, cash – forget it. Nothing will survive what is coming. I now believe we have about 10 years before the end of this era. Get your spiritual house in order everyone. Maranatha.

  • Evie

    If you have money it is best to buy a home with land in the best neighborhood you can.

  • mondobeyondo

    Nice little national bank run they’re having in Greece, huh? Won’t be long before the government places restrictions on the amount of euros you can withdraw from the bank. It’s already happening in Spain. (Something like a 2,000 euro daily limit..?)

    Suppose that happens in Greece. You may have say, 100,000 euros in the bank. You are allowed to withdraw 2,000 euros a day. The Greek banking system collapses next week or next month, and an indefinite “bank holiday” is declared. Now you’re screwed. Forget a cash withdrawal limit – you can’t get ANY of your money out. And by the time the bank holiday is lifted, what’s left of your life savings will be worthless.

    The Greek people are withdrawing their euros and converting them into something more solid (gold, silver, U.S. dollars) while they still can. Before long, they may not be able to. They are scared, and for good reason, because there doesn’t appear to be much time left…

  • Chris

    @Paul- You need to understand what Donald Rumsfeld said many years ago. He said, “The US FED government is not an American Government, it is an enemy force occupation disguised as our Congress”. Any one who can read the Constitution can read that what we call money today is unconstitutional. So if I was you, I would get as self sufficient as you can, store cash for day to day needs, and then save in Constitutional money that backs itself.

  • http://www.westcoastladybugs.com RUSS SMITH

    Hi!,Patrons Of The Economi Collapse Et Al:

    Economist John Exeter decades ago predicted a flight from all paper money into gold saying: “There is a big battle going on in the world between paper I Owe You Nothing Money & Gold Money. Paper is abundant; while gold is scarce & so gold will ultimately win this battle in a bigger and better way than anyone can immagine.” He illustrated his theme by using a picture of an inverted pyramid with all paper assets resting on an apex of gold saying that the ultimate mania rise in the gold price would occur when all the worldwide paper assets resting upon the gold apex attempt to flee into the ultimate security of the gold apex by buying gold, in order to escape all the hideous dangers of paper I Owe You Nothing, fiat paper assets and reasserting the predominance and pre-emanance of the superiority of gold as the only real worldwide monetary money.
    It would appear that ultimately, in order for economist John Exeter to be proven correct, the only dominant deflation such as he asserts will take place, once there is a worldwide repudiation of paper money by the masses. In the mean time The American Institute For Economic Research In Great Barrington, Mass., (888)528-1216, is asking us to buy gold not to make money but to have money under any and all circumstances. Presently, if we buy gold as an inflation hedge to recoup more $’s from gold’s rising price, those $’s will buy less due to inflation plus what we may like to believe are profits will be taxed to the point that government is seeing to it that we even loose far too much of our original capital investment when we purchased our gold. The only beneficiary then from our gold purcases and sales is government whose inflationary policies continue robing us of our earned capital by the loss of buying power resuling from our governments inflationary policies. Remember: the powers to tax are the powers to steal encluding the inflation tax governments prefer to hide from us at tax time. We can’t write off what their inflation steals away from our buying power can we and they don’t allow our income tax advisor to take that loss into consieration either do they?
    However, once the system collapses from total currency repudiation into massive, worldwide deflation, your gold will be appraised at the new level of pricing for everything without the full force of government intervention from overtaxing your assets etc. If you need greater accuracy of advise/evidense and exconomic understanding, please subscribe to the American Institute For Economic Research’s Research Reports & Investment Bulletins plus please request that they provde you with their bonus report in the form of their Chart Book which will profoundly depict the depreciation of the purchasing power of the US $ etc. They are only a Toll Free telephne call away when you get a chance and their prices are very reasonable; as a charitable, not for profit, research organization working in behalf of the American people.

    RUSS SMITH, CALIFORNIA
    resmith@wcisp.com

  • rolf

    who is Jennifer Lopez?

  • http://www.westcoastladybugs.com RUSS SMITH

    Hi!,Paytrons Of Economic Collapse Et Al:

    Here are some historical tid bits upon which we can reflect from time to time providing emphasis regards how far governments can take inflation etc.:
    The worst inflation recored involved the Hungarian Pengo which required the Hungarians to adapt to an accounting structure based upon light years.
    During the 1920’s German Nightmare Hyperinflation a loaf of bread exceeded 300,000,000.000 marks in price; while people in the US today grumble that a loaf costs $5. How many people here in the US realize that during that period of German inflation a German mortgage went as low in price as one US penny? Something for all the present US Real Estate Gurus to think about do you think, even though our present US inflation rate is still rather tame by comparison?
    Paper money was invented by the Chinese and sense that time paper money has caused the demise of more Empires than that other famous Chinese invention: Gun Powder.
    To initiate your greater understanding regards the topic of inflation, you are encouraged to go to the Von Mesis Institute webside to find their 70+ page report, “Fiat Money Inflation In France” by Andrew Dixon White: How It Came, What It Brought And How It Ended.
    It ended when Napoleon demanded that the French Ministry supply Napoleons’ troops with gold coins in substitution for the consistantly depreciating fiat, I Owe You Nothing, paper assignants with which he could pay hs troops or they were threatening to walk off the battle field and let the French Ministry fight its’ own battles. Needless to say Napoleon received the gold coins he demanded.
    What would happen right here in the US today, if all US military personel demanded to be paid their salaries in gold coins only?
    Hans, Otto, Alexander, Exhavier Berr, otherwise known as the Knome Of Zurich, once years ago when steping foot on American soil from Switzerland quipped, regarding America’s penchant to issue paper I Owe You Nothing, fiat paper money: “WEEEEEEEEE…..paper money!!!” Are we now just beginning to understand exactly what Hans’ pronouncement designates to us? Perhaps he forsaw our gutteal response migrating towards: “Whoa, is me paper money?”

    RUSS SMITH, CALFORNIA
    resmith@wcisp.com

  • Clubfoot

    While all the Doomsdayers here are stocking the freezer and buying ammo, here’s what the Greeks will do: they’ll return to the Drachma and business as usual, “I pretend to work and they pretend to pay me”.
    Poor Angella Merckel couldn’t convince the Germans to retire at 70 so the Greeks could retire at 50.
    This isn’t the end of the world, it’s the end of the Euro. Won’t be missed either.

  • bena gyerek

    why would the greek govt impose capital controls? the bank run is being financed by the ecb. even if it happens via the greek cb providing ela, it is still financed by the ecb accumulating target2 claims on the greek cb (if it is an electronic run) and by the greek cb printing and distributing euro banknotes that it will later repudiate (if it is a paper run). would a greek caretaker govt feel it had the mandate to restrict bank withdrawals. surely they must be aware of how badly the argentine corralito ended? why would athens not tell the ecb that it must be the one to decide to pull the plug?

  • andrewleiner

    x The Euro is doing what it was designed to do, collapse. Why? Because it was only meant to be a step toward a One World Money used to create a One World Government which will be used to form what Satan has been working toward for all these thousands of years, a One World Religion. Satan will be worshiped as the number one god and the AntiChrist will be worshiped as Satan’s Sith Lord. When will the Euro collapse? When Satan’s lap dogs are told by him to pull the plug and not one day sooner. I have been waiting for this for 39 years and change. And now it is here. Forty years ago I would do my doomsaying and the people would wag their heads and poopoo me. Now, things have changed. Many nod and many are becoming Preppers.
    ANDREW LEINER MASTER DOOMSAYER.

  • Jod Killingswitch

    Why does the banking system need to be “saved”? The entire so-called system is flawed and doomed to fail. Let it go down and force changes that need to be made rather than follow down the path of Argentina.

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