The Only Glue Holding The Entire Financial System Together Is The Belief That The Central Banks Have This Situation Under Control
Investmentwatchblog.com
January 8th, 2013
by Phoenix Capital Research
As the fiscal cliff euphoria and start of the year buying fade, investors are waking up to the fact that fundamentally nothing was fixed in 2012.
Indeed, once could easily argue that the fiscal cliff “deal” is a great metaphor for 2012 as a whole: an enormous charade played by political leaders that ultimately solved nothing and in fact left everyone worse off.
Case in point, the “deal” has somehow managed to both raise taxes and increase the deficit deficit (by $4 trillion, no less). Economically, accomplishing this should have been virtually impossible. Washington managed to do it. Many words come to mind concerning this. “Success” is not one of them.
Yet even this situation pales in comparison to that occurring in Europe today. There the political leaders are now not only proclaiming that the “worst” is over but that in fact the crisis as a whole is over.
To say this is political grandstanding would be understatement of the year so far: EU unemployment just hit a new record of 11.8%. Also, both Greece and Spain have issued reports revealing that their banks are massively undercapitalized and in fact have negative values.
The Crisis is over, but unemployment continues to grow and the banks are all insolvent. Only in Europe: a place where career politicians are caught on microphone admitting that they have no idea what the economic terms they used in a speech actually mean.
And these people are meant to not only tackle a banking crisis that makes 2008 look rosy in comparison, but somehow get 17 countries with hundreds of years of bloodshed between them to stick together as their respective economies implode?
The Rest…HERE
