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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsThe ECB’s Noose Around Greece: How Central Banks Harness Governments
The ECBs Noose Around Greece: How Central Banks Harness Governments
Posted on March 10, 2015 by Ellen Brown
Remember when the infamous Goldman Sachs delivered a thinly-veiled threat to the Greek Parliament in December, warning them to elect a pro-austerity prime minister or risk having central bank liquidity cut off to their banks? (See January 6th post here.) It seems the European Central Bank (headed by Mario Draghi, former managing director of Goldman Sachs International) has now made good on the threat.
The week after the leftwing Syriza candidate Alexis Tsipras was sworn in as prime minister, the ECB announced that it would no longer accept Greek government bonds and government-guaranteed debts as collateral for central bank loans to Greek banks. The banks were reduced to getting their central bank liquidity through Emergency Liquidity Assistance (ELA), which is at high interest rates and can also be terminated by the ECB at will.
In an interview reported in the German magazine Der Spiegel on March 6th, Alexis Tsipras said that the ECB was holding a noose around Greeces neck. If the ECB continued its hardball tactics, he warned, it will be back to the thriller we saw before February (referring to the market turmoil accompanying negotiations before a four-month bailout extension was finally agreed to).
The noose around Greeces neck is this: the ECB will not accept Greek bonds as collateral for the central bank liquidity all banks need, until the new Syriza government accepts the very stringent austerity program imposed by the troika (the EU Commission, ECB and IMF). That means selling off public assets (including ports, airports, electric and petroleum companies), slashing salaries and pensions, drastically increasing taxes and dismantling social services, while creating special funds to save the banking system. ...............(more)
http://ellenbrown.com/2015/03/10/the-ecbs-noose-around-greece-how-central-banks-harness-governments/
geek tragedy
(68,868 posts)Within two years, the unemployment problem had been solved and the country was back on its feet. It had a solid, stable currency, no debt, and no inflation, at a time when millions of people in the United States and other Western countries were still out of work and living on welfare. Germany even managed to restore foreign trade, although it was denied foreign credit and was faced with an economic boycott abroad. It did this by using a barter system: equipment and commodities were exchanged directly with other countries, circumventing the international banks. This system of direct exchange occurred without debt and without trade deficits. Germany's economic experiment, like Lincoln's, was short-lived; but it left some lasting monuments to its success, including the famous Autobahn, the world's first extensive superhighway.1
Hjalmar Schacht, who was then head of the German central bank, is quoted in a bit of wit that sums up the German version of the "Greenback" miracle. An American banker had commented, "Dr. Schacht, you should come to America. We've lots of money and that's real banking." Schacht replied, "You should come to Berlin. We don't have money. That's real banking."2
Ellen Brown is a National Socialist. And she praises the policies driven by Germany's Military Industrial Complex under Hitler.
marmar
(77,088 posts)...... Secondly, what the hell does it have to do with the OP? ..... Just sayin'
geek tragedy
(68,868 posts)fighting an international conspiracy of bankers.
Does that kind of rhetoric sound . . . familiar?
She is quite popular at st0rmfr0nt.
marmar
(77,088 posts)....... perhaps you need to find a more clever tool to distract from the OP discussion.
geek tragedy
(68,868 posts)Amazing how the ECB held a gun to Greece's head and forced it to borrow money rather than taxing the rich.
The arguments against austerity are very powerful and true. But we don't need st0rmfr0nt's favorite economist to get us there.
Greek sovereign debt is a very risky asset. I don't know anyone who would treat it as money-good collateral for a loan.
jwirr
(39,215 posts)out that the advice of the bankers was not good and many farmers lost their farms. The farmers paid the price but the bankers paid nothing.
I do not support any Nazi but I want to know when the bankers are going to be help accountable for their bad advice and investments? Don't they have some responsibility here?
geek tragedy
(68,868 posts)insolvency don't get repaid.
jwirr
(39,215 posts)geek tragedy
(68,868 posts)be farmers?
jwirr
(39,215 posts)not that they want to be farmers it is that they thought they were better farmers than the real ones. And they used their power as the money holders to force farmers to do it their way.
Look there are whole books related to the idea that credit cards and other means of loans are not honest with their card holders. Elizabeth Warren wrote one herself. The financial industry is at the moment paying huge fines for dishonest deals that they have made. And they get paid back in a way that in itself is not exactly on the up and up - they sell debt. I am thinking that the EU is more than likely handling their business in the same way. They are going to the casino and we are paying.
All I want is reform that addresses the industries responsibility. The last time they had trouble it was the mess with the house mortgages. What is it now? When are we going to make them as accountable for their actions as we are supposed to be?
geek tragedy
(68,868 posts)They have a right to be repaid, not to deceive and abuse.
jwirr
(39,215 posts)geek tragedy
(68,868 posts)Drawing a blank, or thinking "oh shit, really?"
Really.
http://ellenbrown.com/2007/09/11/whats-the-wizard-of-oz-got-to-do-with-money-reform/
The other system dated back to Benjamin Franklin. It operated out of Philadelphia, which was the USAs first capitol before the capitol was moved to Washington. At one of the Constitutional Conventions, Franklins Society for Political Inquiries planned an economy that would free us from economic slavery to England. In response, England sent troops to enforce the private Jewish bankers power, thus sparking the War Of Independence. The Philadelphia faction favored a bank on a model established in provincial Pennsylvania. In this model, a state office issued or lent money, collected the interest, and returned it to the provincial government to be used in place of taxes. President Lincoln returned to the colonial system of government-issued money during the Civil War, but the bankers assassinated him and reclaimed control of the money machine.
Nuclear Unicorn
(19,497 posts)geek tragedy
(68,868 posts)as collateral?
To put it another way, would you accept Greek sovereign debt as collateral for a loan you gave someone?