Business

Speculation: Germany Is Going to Pressure U.S. Into Helping Bail Out Eurozone

Now here’s a dark theory via Business Insider:

We’re at the end of “extend and pretend.” The crisis of the Eurozone is now acute. The headlines are specific. The best analysis suggests that only extraordinary action can keep it afloat. And even that would work only to delay the inevitable for a month or two more.

The euro zone is indeed gasping for air and its financial health is in desperate need of resuscitation. Christine Lagarde, the chief of the International Monetary Fund (IMF), has repeatedly called for bailouts and government intervention. She has resulted to these pleas because she–and most of the western world for that matter–can see no other way out of the obvious fiscal catastrophe. John Ellis at Business Insider continues:

The reality is that the Eurozone no longer offers any good option for continued unity. As an Italian policy-maker told Martin Wolf of the Financial Times, “it would be better to leave (the eurozone) than endure 30 years of pain.”

At the center of the storm sits German Chancellor Angela Merkel, who is being told by one and all that she must take extraordinary action to save the day.  But the truth is she doesn’t have the authority to do so, doesn’t have the votes, doesn’t have the political throw-weight to over-ride the judicial, legislative and political vetoes. She won‘t save the day because she can’t.

What is to be done? Chancellor Merkel, the most powerful woman in the world, has been looked to as the euro zone’s last great hope. However, despite all of this  aforementioned clout, she still lacks the necessary authority to save the euro (especially after her party suffered a “sharp slap” at the polls earlier this September).

In the days leading up to the collapse of Lehman Brothers, then French Finance Minister (now IMF Managing Director) Chistine Lagarde told then-Treasury Secretary Hank Paulson that he could not allow Lehman to fail. The ramifications would be catastrophic, she said.  She was mostly right.

Three years later, it will be Angela Merkel talking to President Obama,Treasury Secretary Geithner and Federal Reserve Bank Chairman Ben Bernanke with exactly the same message.  The United States government and the Federal Reserve must come to the rescue of the Eurozone or the ramifications will be catastrophic. And she will say that she needs roughly $1 trillion in financial guarantees and liquidity support [emphasis added].  That’s the number that will calm the markets.

Although it is terrifying to imagine this happening, it is not too far removed from reality. Moreover, one would hope that US politicians have learned from the Lehman Brothers debacle.

But this may be extremely, wildly wishful thinking.

Given the spending records of Geithner, Bernanke, and Obama, one is not hard pressed to imagine them giving in to Merkel’s pressuring.

Business Insider then proceeds to outline exactly how the German chancellor will go about coercing US support for a $1 trillion European bailout:

She will do this publicly (it will be leaked to the FT or the NYT) because (a) she wants to maximize the pressure on the US to ride to the rescue and (b) she wants the blame to fall elsewhere in the event that the “situation” goes haywire.

And there will follow perhaps the defining moment of the Obama Presidency.  If Obama goes forward and provides all or part of the $1 trillion guarantee, he will likely cut his own political throat in so doing.  If Obama declines to go forward and provide all or part of the $1 trillion guarantee, he will likely preside over the second massively destabilizing financial panic in four years, thus insuring a second Great Recession, thus cutting his own political throat.

On the one hand, the American people will have to pay out should the US government decide to ignore what will most likely be a calamitous financial crash in Europe (which will send shock waves through the US markets). On the other hand, the American people will have to pay out should the US government decide to participate in bailing out Europe (something that America is nowhere near being able to afford).

Either way, unless something magically saves the euro zone from disaster, it is a lose-lose situation for the American taxpayer.

This is the theory presented in Business Insider and it is certainly within the realm of possibility.

It seems that the only thing left to do is pray that D.C. doesn‘t entertain the notion of a European bailout and that Merkel doesn’t ask.

Comments (67)

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  • suzy000
    Posted on September 15, 2011 at 8:47am

    Our first reaction would be that Congress would never allow this. However, Congress does not control the Federal Reserve and as we have been alerted in the past months, the Feds loaned trillions of dollars without our knowledge or Congress’ during the time of the Tarp program. We have an out of control Federal Reserve and because American leaders are afraid of them (Kennedy wasn’t even though he was killed shortly after upon taking on the Feds) we are powerless to stop them. Until we get leaders in unison to bring the Feds to their knees where they answer to the people, we will always be a slave to the central bank. In essence, we work to keep this bank in power.

    Report Post »  
  • tomloy
    Posted on September 15, 2011 at 8:32am

    The US should bail out the euro zone when they repay the US for costs associated with keeping the USSR at bay and WWI and WWII.

    Report Post »  
    • Secret Squirrel
      Posted on September 15, 2011 at 8:58am

      .
      Noooooooooooooooooooooooooooooo!
      No, no, no, no, no, no, no, no, no, no, no, no,
      no,

      Report Post » Secret Squirrel  
    • Wolf
      Posted on September 15, 2011 at 9:02am

      We should let them self destruct. Pull all our troops off every military base around the world. Then let those countries decide if they want to repay us the WW2 loans- which I think Germany and Japan are the only two countries that have (already) repaid those loans.

      Report Post »  
    • UPSETVET
      Posted on September 15, 2011 at 4:07pm

      I agree 100%. The USA has spent hundreds of billions of dollars since WWI propping up the European economy. The EURO was created to compete with and devalue the DOLLAR. So are we now supposed to help it acheive those goals? Obama/Clinton olitics suck !

      Report Post »  
    • burned at edges
      Posted on September 15, 2011 at 9:40pm

      Let the Chinese bail them out. They have all the cash.

      Report Post »  
  • louise
    Posted on September 15, 2011 at 8:26am

    BLAZERS

    The Hegelian Dialectic …Look it up. It is important that all of us understand this. Here is a link to get you started.
    http://www.womensgroup.org/998NEWLT.html

    I just learned of this is recent years. It is a huge piece of the puzzle as to why American institutions (Education, Government, ect), and people think and behave the way they do, and it is applied throughout the fabric of life today.

    Report Post » louise  
    • vennoye
      Posted on September 15, 2011 at 4:53pm

      Thanks for the link, Louise. Wasn’t Joan Veon a great person!!! Watch everything of hers I can on youtube.
      Political Correctness–silencing the voice, really explains why conservatives and tea party are hated so much!
      You might like this link. He covers some of the same material. Don’t know if I agree with him on everything, but he does make you look at things you took for granted before.

      http://www.youtube.com/watch?v=HDDGl79×4Pc&feature=related

      Report Post » vennoye  
    • louise
      Posted on September 15, 2011 at 7:30pm

      Vennoye, thanks for you link. I am going to watch it tonight.
      From everything I have read about her she was an exemplary woman. Here is another link for anyone who would also like to read up.

      http://www.womensgroup.org/

      Report Post » louise  
  • Gonzo
    Posted on September 15, 2011 at 8:24am

    How much do we already save the Germans with our military bases in Germany?

    Report Post » Gonzo  
    • GERATMO
      Posted on September 15, 2011 at 9:07am

      Good point. The EU has already slashed thier militaries down to nothing because we have taken over that role.

      Report Post » GERATMO  
    • pennswoods
      Posted on September 15, 2011 at 10:12am

      Gonzo. American military bases mean economic survival for many rural German communities and have since 1945. When we had hundreds of thousands of tropps in West Germany before the Berlin Wall came down in 1989 American military bases in the then West Germany were the backbone of many West Germany towns and cities even while German left wingers hated America and our troops. Who can forget the massive “hate America” demonstrations in West Germany during the Reagan era when he stood up to the USSR and it’s SS-20 missiles being sent to East Germany? There is absolutely no reason for any American troops in Germany today. If a united Europe has to deal with a nationalist Russia in the future that is their problem not ours.

      Report Post »  
    • proud2bmom
      Posted on September 16, 2011 at 10:34pm

      There are strategic reasons to have bases in Germany and other places around the world. It’s not all about protecting Germany. For starters, it is quicker to get our troops to some places in the world from Germany (for example) than from US soil, making sense to have troops stationed there ready to go.

      Report Post »  
  • donh2
    Posted on September 15, 2011 at 8:10am

    The NWO cult didn’t take down Dominique Kahn for nothing. Now that Christine Legarde is in there Obama is going to be pressured to bail out the Holy Roman Empire. Our concern should be that Obama will have no choice but do what he is told given what they have on him.

    Report Post »  
    • simply one voice
      Posted on September 15, 2011 at 8:20am

      You just got an A+ in Reality Economics 101. Congrats.

      Aware of top economist gc’s, 3G’s?

      Report Post » simply one voice  
    • vennoye
      Posted on September 15, 2011 at 7:30pm

      Two countries stand in their way…..Israel and America. Appears that Dominique Kahn could have been developing a conscience. At the end of the day, when they are no longer beneficial to each other……who are you going to bet on…..The NWO group or the Muslims???

      Report Post » vennoye  
  • ColoradoMaverick
    Posted on September 15, 2011 at 7:46am

    Obama, now’s your chance to buy some love from the europeans!

    Report Post » ColoradoMaverick  
    • smithclar3nc3
      Posted on September 15, 2011 at 8:27am

      Europeans don’t vote in the U.S elections? And Americans that do vote will destroy the democratic party from the ground up if they bail-out Greece and Italy with our tax dollars.

      Report Post »  
  • GERATMO
    Posted on September 15, 2011 at 7:29am

    This is good news and bad news. I think whatever Obama decides to do with this is the end of his career. Bail them out and hes done, dont bail them out and hes done. We cant even afford the plane flight over there to talk about a bail out let alone $1 trillion.

    Report Post » GERATMO  
  • louise
    Posted on September 15, 2011 at 7:28am

    They are playing Keynesian russian roulette in America. Why aren’t ALL of the federal reserve chairmen thrown in prison? Why isn’t BO impeached? Why doesn’t Congress believe in the vision of our Founders? They have to be in spiritual darkness to try and keep this lie going, all the while we are going into the greatest depression.
    What you are witnessing is the nature of man separated from God. ALL you see happening is the rotten fruit that is produced from a rotten tree.. I know there are a lot of agnostic/atheist on these threads and I know that you will have a little chuckle over my post, but I would not be true to God if I remained silent. I know you understand at some level, bad things are around the corner. Turn to God while there is time.
    The only answer is Jesus Christ

    Report Post » louise  
  • barber2
    Posted on September 15, 2011 at 7:23am

    As Nancy once advised: Just say ” No. “

    Report Post »  
  • oldsoldier10
    Posted on September 15, 2011 at 7:21am

    i luv splash pics like the one of the german prime minister and hills, two old white women drinking from gold laced crystal glasses, while their countrymen wonder if they can put bread in their families mouths that evening. we MUST get rid of the aristocracy politician class!

    Report Post » oldsoldier10  
  • GeorgieJo
    Posted on September 15, 2011 at 6:41am

    Hillary RODHAM clinton is drinking a toast and HAVING her cake?
    Last week HillNonBabe was in PARIS

    HOW many villages does it take to raise a democratic moron?

    Report Post »  
  • simply one voice
    Posted on September 15, 2011 at 6:33am

    U. S. Secretary of State, Hillary (Daughter of Satan) Clinton, George (Satan’s Rep.) Soros, President (****** Traitor) Obama,Treasury Secretary( Head Up His A**) Geithner and Federal Reserve Bank Chairman Ben (Puppet) Bernanke, Christine Lagarde, the (Non) chief of the (Soros) International Monetary Fund (IMF), German Chancellor (Have Another Pigs Foot) Angela Merkel, the (Sicko) President of France, the (Ruthless Black Monarchy) U.K., are ALL behind 1 Major Fact of Late you might have missed; SWITZERLAND!

    Yes Folks, our last bastion of Banking Freedom and Secrecy, have Traitored-Out the inviolate voting rights and principles of their people, gone behind their backs and, instead of gold as the one primary backing of the Swiss Franc, they now have their Swiss Franc backed by the Euro. Unbelievable! This is a lose-lose situation for the American taxpayer that, just like the Swiss one morning waking up to the Euro, will have our beloved President announce how we just had to step in without any Americans assent, just helped out the European Criminals that are in bed with all the NWO Criminals mentioned above.

    (Singing from ‘The City Of New Orleans’) “Good morning America, how are ya? Don’t you know me, I’m your native son. On the train the call the City of New Orleans, I‘ll be go’in 500 miles before the day is done.”

    Report Post » simply one voice  
  • TxMadMac
    Posted on September 15, 2011 at 6:29am

    Hillary, tell her to go talk to china, then get your fat as… home ! We don’t have it. Obama just pi$$ed another half a billion down the toilet into a defunct solar company. I think we should call that one his jobs bill. 5oo million spent and 1,ooo jobs lost. That’s not too bad considering his record.

    Report Post »  
  • GETLIFE
    Posted on September 15, 2011 at 6:10am

    Failed European socialism + failed Fannie M./ Freddie M.socialism bringing down the world.

    Report Post » GETLIFE  
  • MOLLYPITCHER
    Posted on September 15, 2011 at 6:05am

    How the hell can we bail anyone out when we cant bail ourselves out?!!!!

    Report Post »  
  • PFN
    Posted on September 15, 2011 at 5:56am

    What are we supposed to bail them out with, a bucket? “Cause that’s about all we can afford!

    IMF=UN=Marxism=the destruction of the Republic! The only (peaceful) way to teach the Marxists the error of their ways is to let them fail! Sorry Europe; we saved your butts twice in the last century and you still didn’t learn your lesson. FAIL!

    Report Post »  
  • SummerB
    Posted on September 15, 2011 at 5:39am

    I will freak out if we spend ANY MORE money bailing out EU. The euro is going to fail no matter how much is invested in it. I’m gonna make some calls to my & other congressmen tom. demanding that they don’t allow O to borrow any money for this. Maybe we all can start preemptive calls to our congressmen. Just the possibility makes me LIVID!!!

    Report Post »  
  • Gypsy123
    Posted on September 15, 2011 at 5:32am

    I think I shall just work part time and own nothing and owe nothing only what I need to eat on a daily basis and health insurance incase I get sick. Then I won‘t get stuck paying every one else’s bills.

    Report Post » Gypsy123  
  • Gypsy123
    Posted on September 15, 2011 at 5:31am

    They spend it we pay for it. Geitner has already been over there figuring out how we will bail them out. Tax payers need to revolt. But every one is afraid of jail. So what do we do any suggestions.

    Report Post » Gypsy123  
    • old white guy
      Posted on September 15, 2011 at 6:24am

      gypsy, there are not enough jails or cops or soldiers to round up everyone especially those who will fight back.

      Report Post »  
  • Meyvn
    Posted on September 15, 2011 at 5:04am

    Uh-hrm. As a U.S. taxpayer, I have grown weary of bailout’s. Stay out of our pockets!

    Report Post » Meyvn  
    • Ruler4You
      Posted on September 15, 2011 at 5:28am

      Germany, you want money? Go directly to China. We aren’t gong to borrow it for you. You idiots wanted this stupid European union in the fist place and now you have it. It was stupidly designed and you got the results everyone expected from it, even you. It was constructed for all of the wrong reasons and became exactly what you (supposedly) didn’t want. It was flawed by design. An idiot can see that.

      I‘m sure I don’t need to point out that maintaining cultural economic constructs, sovereignty, philosophies and attitudes while entering into a common currency was fatalistic. National economies vary as the political structure. Production economies vs. socialist economies while sharing the same currency means money flows to the socialist cesspool. It can’t work any other way. IMHBLO, you were the foolish one. You should have known this was the case. Too bad. So sad.

      Report Post » Ruler4You  
  • chipmunk
    Posted on September 15, 2011 at 4:00am

    IF they drag us into the blankety blank euro mess I will absolutely flip my lid. I can not express how mad I would be. How stupid. Unbelievable.

    And Germany should have told them to go to HE11 & dumped that bunch of lazy spendthrift socialist losers awhile back.

    This would be so unfair to American taxpayers. How dare they. Of course the US doesn’t have any money of its own. We’re printing & borrowing every dime those freaks in DC are spending.

    @COLONIAL10, did you need me to lend you $10K?

    Hey CHUCK, can I borrow $10LK?

    Report Post »  
  • colonial10
    Posted on September 15, 2011 at 3:34am

    The progressives and evil revolutionaries are setting this up perfectly. This will be their main point on a world economy. Someone is banking on all of this. All it is, is a business opportunity for a group of people. Maybe the IMF, I did see an article where George soros was telling them to sell gold. Just go to the IMF website and see how much Soros is involved. He gives them advice. Interesting. Our government has already sent billions of money over there, this is nothing new and no speculation. Remember, gold can be manipulated to. If you buy an once at 1800 dollars it can just as easily go down to 300 an oz. IMF has been hording gold for many years and it’s stock pile is outrageous. If they flood the markets which they can gold will drop. I‘m glad I invested in a piece of property with it’s own water supply and renewable energy. When the market collapses I will have all I need and more to share with the people that only have gold or nothing.

    Report Post » colonial10  
  • NEAF
    Posted on September 15, 2011 at 3:20am

    No!

    Report Post » NEAF  
  • TH30PH1LUS
    Posted on September 15, 2011 at 3:14am

    The Euro = too big to fail?

    Germany’s not going to prop it up forever. That official from Switzerland was right when he said they INTENTIONALLY avoided being sucked into the Euro system. Too bad the political elite in Europe and America “know better” than the rest of humanity, and continue to insist on their global “governance”.

    They’re pushing the world over a cliff!

    Report Post » TH30PH1LUS  
  • Chuck Stein
    Posted on September 15, 2011 at 2:50am

    As if our ongoing military subsidy isn’t enough? Most NATO nations in Europe don’t even meet their small goals for military spending (interestingly, Estonia is an exception). But watch out — Obumbler will probably try to get us to an stining European bailout. Grrrrrrrr

    Report Post »  
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