Today the man who 73 days ago remarkably predicted the collapse of the euro against the Swiss franc stunned King World News when he said that the current global financial system will cease to exist. This interview takes a frightening look what is really happening around the world and the chaos that is still to come.
Egon von Greyerz: “Eric,
the Greek situation is key because the consequences of the outcome in
Greece will have a major impact on the world. It’s interesting to note
that Greece has been in default or rescheduling its debts for 50 out of
the last 200 years. The Greek Finance Minister, Varafoukis, is playing a
very clever game….
“Varafoukis
demands that there will be no austerity and that most of the debt be
forgiven. This is unacceptable to the Germans and the Eurocrats.
Varafoukis Knows How To Play This Game
But
the Greek Finance Minister, Varafoukis, knows how to play this game
because he is an expert at game theory. He has now opened up a dialogue
with China and Russia. This is unacceptable to the EU and the United
States. Neither the EU nor the U.S. would welcome a Russian naval base
in Greece.
Major Repercussions For Europe And The World
Regardless
of the outcome in Greece, there will be major repercussions for Europe
and the world. The world is already very close to an avalanche of money
printing and defaults. Also, other countries in the EU are waiting to
follow Greece.
World Incredibly Fragile And Unstable
Eric,
this will not end well because the world is so incredibly fragile and
unstable. The truth is that central banks have no idea how to get out
of this crisis. The problem is that there is no way out of this without
a major implosion of the world economy.
Central
bank after central bank is now setting negative interest rates. The
latest today is Sweden. This is being done in an attempt to create
inflation. Sweden is also starting a QE program and this is with an
existing massive property bubble and consumer debt problem.
History Repeating From The Great Depression
Another
interesting fact has to do with Austria’s 3rd largest bank — their
shares are now down 60 percent from 2014. This is because of fears
stemming from mortgage loans made in Swiss francs. Well, the Great
Depression of the 1930s started with an Austrian bank going under. We
now have to ask: Is history repeating once again?
In
the meantime, central banks around the world are now monetizing 100
percent of the debt being issued. Eric, the central banks are the only
buyers of government debt. Nobody else would be foolish enough to buy
government debt that will never be repaid in today’s money.
The Fed Is Already Bankrupt
Coming
to the United States, things are not as rosy as the mainstream media
would have people believe. There are renewed demands that the Fed
should be audited. But I can tell you, Eric, even without an audit,
that the Fed is bankrupt. The Fed only has capital of $57 billion and
they have assets of $4.4 trillion. That is a massive 77-times
leverage. Half of their assets are in government debt that can never be
repaid and the rest is in mortgage debt that can never be realized at
the current value of $1.7 trillion. But all central banks have
insolvent balance sheets across the globe.
Economic Collapse In America
Let’s
look at the facts about what is really happening in the United States:
2/3 of Americans do not have $500 in savings. So the average American
has huge personal dedt and is one paycheck away from bankruptcy. Retail
sales were down 0.8 percent in January and 0.9 percent in December.
This is the worst decline since 2009. Median income is down 10 percent
since 2000.
The
Labor Participation Rate continues to fall in the U.S. — all the way
down to 62 percent. That figure was 67 percent in 2000. So 93 million
people are not in the labor force. In 2000 that figure was 68 million.
That’s an additional 25 million who are not in the labor force.
Officially,
8.7 million people in the United States are unemployed. But think
about this: There are another 93 million who are not considered to be
in the labor force. So the supposed unemployment rate of 5.6 percent is
a preposterous fabrication.
To
give you an idea of how phony the unemployment figures really are: If
you work only 10 hours in the U.S., you are not considered unemployed.
But how can the average person survive with only 10 hours of pay each
week? So the government statistics are all a lie and John Williams’ 23
percent unemployment number is a much more accurate figure.
U.S. Debt To Hit $25 Trillion
Eric,
the point I’m making is that the problems in the U.S. are just as big
as the problems in Europe. The U.S. is the most indebted nation in the
world. The U.S. already has $18 trillion of debt but within the next 4 –
5 years that figure will rise to a staggering $25 trillion. And when
the U.S. dollar begins to fall, the U.S. stock market will be under
massive pressure.
Time Is Running Out
The
bottom line is that the world is heading toward a catastrophic outcome
and there is nothing that can be done to stop it. In the meantime
governments are desperately using propaganda to try to keep social order
in their countries. This will only work for so long before massive
protests erupt and total chaos ensues. Time is running out for the
current global financial system — it will cease to exist — and people
need to make sure that they have themesleves and their families prepared
for the coming chaos.”
Greyerz added: “The short-term manipulation in gold is designed to keep people out of the market. Maguire touched on this in yesterday's KWN interview. We have already seen the lows in gold and the central planners are simply trying to keep fear alive in this market. It won't work, Eric, because the problems we have just discussed are guaranteed to propel gold to new highs in 2015.”
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