Radio Interview 2/25/2012: Greek Bailout, Europe, and Federal Reserve QE3

We were interviewed on Saturday Session with Bishop about Greece and the proposed bailout and how it forces Greece to relinquish its sovereignty.  The details of the proposed bailout, which would include new restrictive laws, more pension reductions and spending cuts, the prohibition against any Greek political action contrary to the bailout, and the requirement to make debt payments before any public spending in Greece would be allowed, and the need for resolution prior to March 20th, which is the date on which Greece must pay maturing debt.  Greece is already in technical default.  We discussed the imposed austerity programs and how they are making Greece's economy even more unsustainable.  We discussed how Greece will inevitably face the choice of default within the euro or default with abandonment of the euro which is a choice between economic slavery as a colony of the eurozone (Germany) with foreign EU/ECB technocrats running the Greek government or the harsh new beginning of freedom with a new sovereign currency which could devalue up to 80% after a fixed exchange from the euro to the new currency and the redenomination of  all Greek public and private debt into the new currency and the possibility of economic growth.

While it may appear that the United States has decoupled from the developing storm of Europe, the consequences of a currency union without a fiscal transfer mechanism, recession in Europe, eventual Greek default, and the pressure on European banks and other eurozone peripheral countries will have global consequences on financial liquidity and the world economy including the United states and China.

We also went over the minutes of the last Federal Reserve Open Market Committee (FOMC) meeting in which most members are not inclined to initiate a QE3 unless disinflation reasserts itself and economic growth weakens in the future.

An MP3 of the interview is here.  The European situation and the tragedy of Greece have been unfolding in very predictable and obvious fashion for a few months.  Even Wolfgang Munchau has finally acknowledged that Greece needs to default.

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