French Fried Banks
by Gary North
Ben Bernanke is in panic mode. The November 30 coordinated announcements of six central banks regarding their intervention into the currency markets was exactly that – coordinated. If you think it was coordinated by anyone other than Bernanke, you are out of touch with reality. (Test: name the heads of at least two of the other five central banks.)
As I shall argue, this was an action preliminary to (1) Angela Merkel’s December 2 speech to the German parliament, which is preliminary to (2) the next Eurozone summit, scheduled for the weekend of December 9, which is preliminary to (3) a coordinated violation of the two treaties that created the European Union, which is hoped will (4) pressure the European Central Bank to buy newly created Eurobonds issued illegally by the EU, in order to (5) raise enough euros fast enough to buy Italian government bonds before (6) the Italian government misses interest payments, which may (7) bankrupt the largest French banks, which could (8) trigger a worldwide financial panic.
In short, Bernanke and his peers are in a pre-panic panic.
DECIPHERING THE ANNOUNCEMENT
This was an announcement of a very specific kind. Ninety minutes before the American stock markets opened, the six central banks said that they would increase the availability of money.
The Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Federal Reserve, and the Swiss National Bank are today announcing coordinated actions to enhance their capacity to provide liquidity support to the global financial system. The purpose of these actions is to ease strains in financial markets and thereby mitigate the effects of such strains on the supply of credit to households and businesses and so help foster economic activity.
In short, The FED assured us, they were acting on behalf of the best interests of common people around the world. They were doing this in the name of the People. “What’s good for the People is good for central bankers.”