The Collapsing Eurozone
May 18, 2012 by Bob Livingston
This week, Greek citizens withdrew hundreds of millions of euros from Greek bank deposits in what is being termed a bank trot (as opposed to a bank run). That was followed by 1 billion euros being withdrawn by customers of the Spanish bank Bankia (1 billion euros equals $1,273,804,216.29 U.S.), a huge, but not yet crippling, blow to the Eurozone. But these bank “trots” have a strong potential to turn into bank runs, and Portugal is teetering and could join them.
The European Union is collapsing financially. It may also be collapsing politically. The Germans (the only EU country with a growing gross domestic product) are preaching austerity. Both Greek and French citizens have rejected calls to turn off their gravy trains.
The United States is heavily invested in banks throughout Europe thanks to secretive Federal Reserve policies (that came to light after the partial audit) of bailing out European banksters with Fed-created fiat money. Through the International Monetary Fund, the United States is on the hook for about $16 billion if the euro fails.
And then there are the so-called vulture funds: funds that have bought Greek debt and are threatening to sue if interest payments aren’t made. The Greek government threatened to withhold payments but capitulated rather than risk a showdown with the funds. A “disorderly” Greek exit — which will leave the European Central Bank holding Greek’s bad debt — is becoming increasingly likely. When the Grecian economy collapses and Greece exits the euro, Germany, France and the United States will be on the hook for about $1.3 trillion.
Some Greek citizens are worried.
“This entire situation has got my family extraordinarily worried about our savings, in case we return to the drachma,” Yannis Paleologos, a 40-year-old pharmacist, told The Independent. “We have a considerable amount of money and we’re scared to lose it.”
Paleologos was about to go to a bank to discuss how to preserve his deposits in case of an exit from the single currency union.
There is one way Paleologos can preserve his wealth, but I’ll bet his bank won’t mention it. He can withdraw his savings and buy gold and silver. Then, while his neighbors beg for bread, he’ll be able to buy meat and potatoes.
This is a perfect example of why I advise you to buy gold and silver. Fiat dollars fail. Precious metals never do. The EU’s collapse will resonate with — and likely collapse — the U.S. economy. The JPMorgan derivatives bomb is also about to drop.
Are you ready? In addition to gold and silver you should also have food, water and guns and ammunition stockpiled. If not, why not?