Wednesday, June 1, 2011


According to the dictionary, schizophrenia is “a long-term mental disorder of a type involving a breakdown in the relation between thought, emotion, and behavior, leading to faulty perception, inappropriate actions and feelings, withdrawal from reality and personal relationships into fantasy and delusion, and a sense of mental fragmentation.”

Read up on it.
In Europe, they’re having the same thing—only writ large: It’s not that the political/financial leadership of Europe is at odds with the people—it’s that they’re two minds locked in a single body, struggling for control.

In the one hemisphere of this divided brain, the political/financial leadership is convinced the European union is something devoutly to be wished—no matter what the costs, no matter what fortune and the people throw up in opposition.

In the other hemisphere of the europhrenic brain, the people of Europe overwhelmingly do not want integretation “at all costs”. In some parts (a lot of parts) of Europe, they don’t want integration at all.

Now, like a lot of schizophrenics, europhrenia has been latent over the past dozen years—since the 1999 monetary union, as a matter of fact—because everything’s been going great guns.

This is natural—and completely predictable: You ever see a schiphrenic have a break-down when he’s happy, high, and just got laid? No you do not—he only has his little “episode” when he’s stressed.

Same with europhrenia: Everything was copacetic between 1999 and 2008—though there were signs of the disease. In fact, lots of unmistakable signs of europhrenia:

• No country ever voted for monetary union—ever. European monetary integration only ever happened by either government diktat or the legislature overriding the will of the people.

• Switzerland is not a eurozone member because, although the political leadership rather desperately wanted in on the union, legally the only way to do such a monetary union is through a Swiss-wide referendum—and the Swiss political leadership knew that they would lose any such referendum.

• In the nations where the European Constitution was put to a vote in 2005—Spain, France, Holland, Luxembourg—the results were so embarrassing that the other countries retreated on a referendum. In Spain, the Yes vote won—but in the lowest voter turn-out in Spain ever—while in France and Holland, the Constitution lost by resounding margins. And this was back in 2005, when everything was booming. In the end, rather than face the electorate, the European Constitution was superceded by the Treaty of Lisbon—a work-around that short-circuited the democratic process, and got the European leadership what it wanted.

These examples are to emphasize one and the same thing:

The people of Europe never wanted total European integration, not even in the best of times—whereas the European leadership adamantaly insisted upon it.

Now, we are no longer basking in the golden glow of good times: On the contrary, Europe is facing a nasty solvency crisis.

So naturally, we’re heading into the manic phase of europhrenia.

The basic problem of the current crisis is, countries of the European periphery—Greece, Ireland, Portugal, Spain, Italy—took on too much cheap debt from banks in the core eurozone countries—France, Germany and Holland—and now are unable to pay for it. It’s not more complicated than that.

(One could argue that the reason the European nations overspent was that the leaders were basically bribing the people with a false sense of affluence, bought and paid for via debt, so that they would acquiesce to the European Union and the eurozone. But that’s for another post.)

There are five ways to get over an unpayable sovereign debt:

1. Default on the debt.
2. Restructure the debt, with both sides making sacrifices.
3. Inflate the currency, as the United States is currently doing.
4. Lend more money in the form of “bailouts”, which is essentially kicking the can down the road.
5. Or squeeze blood from a stone—i.e., impose austerity measures.

Option #1—default—helps no one, and wrecks economies in the short term. Option #3—inflating the currency—is a bad idea for the euro, as it is too young a currency—if the ECB starts really inflating, there might well be a panic out of the euro. Option #4—lending more money—is just postponing the day of reckoning, while adding more to the debt burden. And Option #5—austerity measures—cripples an economy by leaving it too weak to grow its way out of the solvency jam that it’s in.

The sensible thing, of course, would be Option #2: Restructure the debts of these countries, much like during the Latin American debt crisis in the early ‘80s, whereby everyone shares the pain, equally. Banks and other creditors take haircuts, countries are put on a fixed payment schedule and reduced credit availability: Everybody takes a hit, but nobody gets killed. Everybody moves on—bruised but otherwise okay.

Has the political and economic leadership of Europe chosen the sensible approach?

Can PIIGS fly?

The political and economic leadership of Europe has collectively chosen Options #4 and #5: They are lending more money to the insolvent nations—Portugal, Italy, Ireland, Greece and Spain—thereby adding more debt to their burden. And they are imposing austerity measures on the politically weaker countries, specifically Greece and Ireland now—but Spain, Portugal and Italy soon enough.

More loans via bailouts are of no help—they just kick the can down the road, while simultaneously making that can bigger.

Austerity measures naturally hurt an economy by slowing it down—and a slowing economy creates a whole host of problems: Unemployment, poverty among the elderly and the young, generalized discontent, all the rest of it.

But the leadership of Europe seems unperturbed: They’re going hell-bent-for-leather in the direction of bailouts and austerity—which seems strange: It would be a bit like giving an addict both more heroin and insisting he go cold turkey—I mean, make up your mind, right?

So why is the political and economic leadership of Europe insisting on both more loans and more austerity? Why, simplicity itself:

In the current eurozone crisis, the leadership class in Europe has identified the well-being of the banks with their own well-being—to the detriment of the well-being of the Continent, and of the people of Europe.

There’s that old saying in finance, “If you owe a bank a million dollars, that’s your problem—but if you owe the bank a billion, that’s theirs.” That saying applies infinitely more so to this situation.

The sovereign insolvency of the European countries is a mortal threat to the banks of Europe.

From the banks’ perspective, what would they want the PIIGS to do? Why, to either take on more loans in order to pay off the older loans. And when that doesn’t work, then start the PIIGS on austerity programs and simultaneously push them into selling national assets to pay off the debts to the banks.

Which is exactly what the European leadership has been doing: Giving more loans to the teetering countries, while pushing Greece and Ireland into austerity.

In fact, since the start of the Global Financial Crisis, everything that the European leadership has been doing has been in service of the welfare of the banks—not the welfare of the people. The bailouts of the banks—the bailouts of the sovereign nations—the austerity measures—all of it: It has been to help the banks as an end in itself. To the detriment of the people.

Need examples? Why, we’ve got examples galore!

• Brian Cowen, Ireland: In September of 2008, in the depths of the Global Financial Crisis—unprovoked—he went out and guaranteed the Irish banks’ liabilities. Ireland as a nation is broke because of this decision—a needless decision, because at the time, the Irish state was fully funded, thank you very much. But when Prime Minister Cowen made this terrible decision, he essentially socialized the losses of the banks. That’s why Ireland is on the Critical Care list—and why the IMF and the ECB have crammed down austerity measures and more loans.

• Angela Merkel, Germany: She bailed out the Landesbanken—the State-owned savings banks, which had made some horrendous decisions in the run-up to 2008—and then has pushed for their loans to the PIIGS to be made whole. So essentially, by refusing to renegotiate thus far, Merkel has actually forced herself into the position of providing the PIIGS with more bailouts. Naturally: If Germany won’t renegotiate and doesn’t provide more loans, then all that’s left is bankruptcy—and an even bigger loss at the end of the day.

• Dominique Straus-Kahn, International Monetary Fund: DSK wasn’t a paladin cut down by his willie—he was an Establishment figure, and the policies he was implementing in the IMF with regards to Greece and the other PIIGS weren’t long-term, permanent solutions: All DSK was doing was negotiating more loans for the insolvent countries, more bailouts—in other words, he was trucking in temporary fixes, just kicking the can down the road for a bit. Why? Because he had his eye on the French presidency: He wasn’t about to go to the French banks (which have enormous exposure to the PIIGS) and cram down a forced haircut on their loans. Forced haircuts might be the way out of this crisis—but that would have antagonized a very key base of DSK’s support: The French money men. So don’t weep over DSK as if he were some fallen hero—because he wasn’t. He’s just a loser who couldn’t control his pecker.

(While we’re at it: I don’t for a second buy into the notion that DSK was set up. The fact that his lawyer almost instantly floated the trial balloon that it was consensual sex erases any possibility that it was a frame job. And I call bullshit on any notion that this West African maid was a honey pot—Laetitia Casta she ain’t. Bottom-line, nobody torpedoed DSK—he did it all on his lonesome, by showing unbelievably bad jusdgment.)

• Christine Lagarde, France: This teetotalling, brussel-sprout-munching, yoga-instructing bitch refused to budge on the 3% capitalization rule at Basel III—she claimed that requiring banks to put up more Tier 1 capital would choke off growth. So naturally, with a mere 3% cushion, any hit a French bank takes could likely push it into insolvency—exacerbating any crisis. Not only that, with such a small capital cushion, it effectively prevents any haircuts on the banks’ exposure, unless the French government allows them to go bust—and of course, the French government never would. So it obliges the French government to get behind any call for debtors to go the route of austerity. Lagarde did this! And this is the fucking idiot—or corrupt bankster’s toady—who’s been tapped to run the IMF . . . and like DSK, Lagarde is aiming for the French presidency in 2017. So any decision she makes as head of the IMF will not be in the best interests of the nations she’s supposed to be helping—it’ll be in the best interests of the French banks.

These individual leaders aren’t the only key players—they’re just a representative sampling of the sort of eurocrat running the shop.

All that these individual leaders have done has been in the service of the financial sector—not of the people of Europe. Perhaps that wasn’t their intent—but intentions don’t matter, all that matters is effect.

And what has the effect been on the other half of our europhrenic patient?

Why, it’s rebelling:

• Denmark: The Danes—who never joined the eurozone to begin with—just put up border controls. It still allows people to cross into and out of it without a passport—but it’ll be a matter of five seconds to close the borders, now that these controls are up and operational. (And you thought America was over-the-top with regards border controls—Denmark borders Germany and Sweden!)

• Finland: The True Finns party just won big on a “Finland-First/Fuck-Foreigners” platform. They have 39 seats in the 200-seat Parliament—just shy of 20%, making them a player in Finnish politics. ‘Nuff said.

• Greece: The Greeks are rioting and collapsing as a society—sensible people are beginning to wonder if another military dictatorship might not take over the country.

• Spaniards: Unemployment is at 20%, youth unemployment is at over 40%, people are protesting—peacefully, for the most part, for now—but all in all, the people are pissed. The IMF and the ECB are throwing money at Spain, but everyone recognizes that that’s just postponing the inevitable.

In short, all that the people of Europe want is an exit from this sinking ship—even as the European political and economic leadership try everything in their power to keep the Good Ship Euro-pop afloat.

Now, I do believe that the sovereign will of the people is not always right. Sometimes, the sovereign democratic majority makes terrible decisions—this shouldn’t be controversial, as we have plenty of examples: Prohibition, for instance.

That the European leadership is trying to force Continent-wide integration against the will of the people in and of itself is not necessarily a bad thing. The whole point of European integration—which is often forgotten—is to tie up Germany and France so tightly that they never again go to war, as they have periodically done over the last couple of millennia.

The problem is, in this particular solvency crisis, the angels are on the side of the people, the devils on the side of the leadership. Whether it is out of cronyism, or political calculation, or whatever other reason there might be, the leadership class is trying to save the banking system—

—at the cost of the people’s welfare.

The European solvency crisis is barely getting started—we haven’t really seen the worst of it yet. We haven’t even seen the medium of it yet. Which should give us pause, as we consider the following:

As the people and leadership of Europe diverge more and more—that is, as the people experience more suffering as a direct result of the leadership’s policies, and as the leadership continues blindly acting in the best interests of its financial sector as opposed to the people—it is reasonable to expect more and more social upheaval not just in the peripheral nations, but even in the core eurozone member states.

Therefore, it is only a matter of time before the European Union is ripped apart—unless the European leadership as a class understands that shielding the best interests of their financial sector is akin to attacking the interests of the people.

Since core beliefs never change until far past the point of too-late, there is every reason to believe that this crisis will end with the eurozone being torn apart—possibly even the European Union as a whole being broken apart.

At The Strategic Planning Group, there will be a major release—“When the Euro Breaks”—this coming June 17. This Scenario will discuss the European situation, the outlook for the euro, and a formal recommendation regarding how to proceed, if and when a breakdown of the euro takes place. This release will be available for SPG Members only.


  1. Sooner or later the people of Greece & Ireland are going to escape from their straightjackets, and bust out of the mental ward.

    Then watch out!


  2. GL:

    Interesting piece of the world-wide puzzle. I wonder if Iceland may become an example of what to do if:

    1. their government continues to push for EU integration,

    2. the people continue to say: "Ríða þér!!!"

    C deK

  3. I couldn't agree more. what's happening in europe is the naked truth of GL's discription.
    I was there last three weeks and I notice the denial attitude of the french people supporting and worshiping Strauss-Kahn as a god. So now that the "walking-peker" is off the main stage. The media and french government are pushing to shove the entire europe Christine Lagarde as their savior.
    Indeed, both of them are the representatives-figurines of the French aristocracy looking out to save their fortunes at any cost.
    Liberte/equalite/fraternite. Is only a myth from "Les Miserables"

  4. It's as simple and as certain as gravity: in an unprincipled democracy what people will ask for is more services and less taxes, which is best provided (as far as the voters are concerned) by the politician who is most willing to sink his country into debt. The rest of the story doesn't even need to be written, it's like saying you threw an egg in the air. Of course the egg will eventually break.

  5. A quick couple of points here:

    - Yes, DSK was (a) a blathering idiot with an ego twice the size of his libido and (b) a complete tool in the hands of the moneyed elites. He has been removed from the picture and, as a Frenchman, let me be the first to say: good riddance. I hope the US locks him up in prison for the next 20 years. Rikers Island has such a nice ''ring'' to it.

    - Yes, Lagarde is (a) a blathering idiot and (b) a complete tool in the hands of the moneyed elites and (c) a complete incompetent. The only thing nice you can say about her is that she is not going to rape her chambermaid like DSK.

    On the other hand, I do believe the end game, as far as Europe is concerned, is to last just that little teeny bit longer than the USA. Everybody, in Europe, knows that a day of reckoning is coming for the US, and everyone hopes the US$ crumbles before the Euro does.

    Finally, the goal of Europe is, as you pointed out, to prevent France and Germany to go to war ever again. On the other hand, for most the past centuries, Germany was a bunch of small, divided countries that could easily be conquered by France. It was only through the unification of Germany under Prussian rule in the latter part of the XIX century that Germany became a power to be reckoned with. Before that, Austria was ''the'' MittelEuropa power, and the one France had to deal with.

  6. It's gonna all end in tears...from the tear gas.

  7. I'd like to remind the readers, that europhrenia is a fictional mental disease that GL created for illustrating the problems of Europe. (Nicely done.)

    In real schizophrenia, the illness is a very serious, and 100% disabling, disorder of the part of the brain that processes thoughts.

    A common misconception is that schizophrenia is a 'split personality'. This is not true. The origin of the word schizophrenia comes from the concept of a person being split from reality.

    Thanks for listening.

  8. For me, the most interesting split is the one between current American anti-war sentiment and the level of patriotism required to reinstitute the draft.

    As I am typing this a desperate attempt is under way to raise the American appetite for war. There is a race to raise it to the level necessary to commence major hostilities before the dollar implodes.

    We are in for an abundance of flag waving. Watch for it.

    K Smith

  9. It never fails to amaze me that so few can control so much. Sometimes, I look at a world map and pretend I am moving, and inevitably every country is NOT the place to be. Every country is at odds with the globalist system. It's either going to be a very, bloody world war, or one hell of a world police state.

  10. European integration has a nasty sound to it. You might think it's "not actually a bad thing", to prevent France and Germany fighting, but the rest of us have to suffer being controlled by a foreign power---Brussels. The UK for example is effectively no longer sovereign, even though the government claims it is. That fact will be driven home even more when the EU decides to directly tax the people, over and above the taxes already paid to Her Majesty's Inland Revenue. Such taxation is being discussed right now.

    Integration in the EU's eyes amounts to everything; monetary, economic, political, loss of national identity, everything that defines a country. In 1975 people voted for improved trade agreements---the EEC---they did NOT vote for the ultimate formation of the Fourth Reich.

    Those unelected commissioners in Brussels who drive the EU-wagon have no interest whatsoever in the masses; they are, like most of the MEPs (members of the European Parliament)fixated on self-interests, profiteering and career-ladder climbing.
    The Eurozone and indeed the entire EU must collapse if the people are ever to free themselves of this monster and go back to being vibrant nation-states. I am aware that there are those hoping for the USA to collapse before the that the final stages of a world government can be put in place. It must be resisted at all costs.

  11. regarding illegal power grab, Europe is a little bit ahed US inside its territory, while US is way ahed when it comes to other countries

    regardin economical problems, US is way closer to doom, and has lower valuable human resurces than EU does - and I mean valuable persons who can sustain themselves even in harsh conditions, war and no money - well in EU there are a few newcommer countries that did just this for the past 50 years and will do fine in any great crash

  12. "one world government" will never happen thanks the 2nd Amendment and the hundreds of millions of guns in the hands of the US citizens. I would love to see the UN "peace keeping forces" try and subdue the discourse that would play out here...that would be funny.

  13. Following # 4 and 5 is a recipe for revolution. People won't put up with going broke and being unemployed while the rich get bailed out with the people's money.

    Here in the U.S. 90% of the public was against TARP. If there were protests, the media never covered them. But another double-dip or another bank bail-out could be the spark for us.

  14. Until the definitly jew syndicate that has usurped power in both the USA and Europe is addressed and stripped of its wealth and power you are all just pissing in the wind.

    It looks more and more everyday that Hitler was right. Ask yourself why the politicians of Europe and the USA keep doing things their constitutuants hate? Who is leading them down this path? Who owns the media that claims that anyone against globalization is just a racist? Politicians need money and press to get elected, who controls the money creation and the press in the USA? The answer is jews for all of the above questions.

    Read the Culture of Critique by Dr Kevin MacDonald for absolutely irrefutable evidence that what I wrote above is true.

    I know this is ugly stuff but hidng from the truth because it is ugly leads to violence in the end.

    James Scott

  15. What? Number 1 helps no one? You MUST be kidding. You thought you'd slip that blatant lie right on past and we wouldn't notice?

    What is the problem with the world? Answer (besides predators running everything): DEBT. DEBT. DEBT. DEBT. DEBT. DEBT.

    So, let's be clear, to DEFAULT:

    #1: Means the people no longer need to pay money spent by their parents and grandparents. That sure as hell benefits them (or fails to trash them).

    #2: Means nobody in their right mind will lend to that country any more. That is GOOD because DEBT IS BAD. Why start the obscenity of debt all over again? Answer: Don't. And not having anyone willing to lend to you helps you do the right thing; STOP GOVERNMENT SPENDING. Okay, it is only REDUCE government spending, but it was nice to dream for a few seconds.

    The correct answer is #1: DEFAULT.

    And hey, guess what? All the borrowing from central banks (or other banks and financial institutions) was NOTHING. That's right - when the central bank (or any bank in the utterly fiat world of today) lends money, they simply create that money out of thin air (actually, they just type on a keyboard and create a book entry).


  16. The problem the EU has today is quite simply that it doesn't have any justification or real purpose whatsoever any more. The original purpose of the EU was to keep Germany and France from going to war once again, create a common market, eliminate tariffs and rebuild Europe after WW II. The EU also played a (reluctant) role in the pacification of the Balkans, with the breakup of former Jugoslavia in a bloody civil war. But that's all over and done, and now there simply isn't any real purpose the EU is serving any more. German reunification (the reason why Germany agreed to the french plan of introducing a single currency in return for french agreement to reunification) changed everything, simply because the geo-political weights have shifted so far to the right on the european map that Germany is much more looking eastwards towards Poland, Ukraine and Russia than westwards towards that collection of salon-socialist "etatist" clowns that run the sclerotic french society today. Mrs. Merkel speaks perfectly russian, gas pipelines are being built from Russia to Germany to secure Germany's energy needs in return for german technology and political support. In those areas that would require a pan-european approach, for example energy policy, foreign policy and so forth the EU simply doesn't deliver because the national "Befindlichkeiten" are too different. French people like to go to picnic close to a nuclear power plant (no joke), Germans just voted nuclear power dead in ten years time. So the EU today is just a techno-bureaucratic shell that offers second-class failed politicians highly-paid jobs but not more. And therefore it will perish.

  17. IMHO: I live in the USA, I am working, literally, overtime, trying to get enough money to escape the USA before the start putting the screws to my bank account and my paycheck. I'm in year three of my five year plan to escape the USA and I am not planning on being here in year five!

    Here is my observation but in no way an epistemology; just observation.

    If Americans, turned off the TV and stopped allowing themselves to be salved by entertainment and brainwashed by the drive by media we would be at a new American Revolution within two years. I gave up TV a year an half ago and I am amazed at the clarity of my understanding of things vs. my common countrymen. That said I am not suggesting they would all follow my way. I am leaving because American Idol is more important to Americans than America.

  18. GL
    Continuing down your initial point that the Euro was done without the support of the people, maybe this crisis was the plan all along by the Euro backers (ECB/Banks/Elites)including this inevitable crisis.

    A flawed or partial monetary union (no central taxing or political union) would show up eventually with a predetermined solution waiting in the winds - a central taxing authority with eventual political union or a Paulson like "Financial Armageddon" is threatened. This would never happen without a crisis like this so after a decade long debt orgy, the plan may be right on schedule. By loading up the ECB with all this crap from Big German and French banks ensures a showdown (sound familiar?).

    There are a few people starting to write about this and would seem to be plausible considering what happened on this side of non-radioactive ocean.

    EB of SF

  19. It is important for this discussion to understand that the people who ask for more services are not the same people asking for lower taxes. Those who are productive and work hard to take care of themselves are over taxed and indeed want lower taxes. Those who are unproductive and have no intention of taking care of themselves want more services. This system is on the verge of collapse. When it does, all of the unproductive will wake up from their drug induced stupor and discover the gravy train has gone off the rails and the free ride is over. This will not be pretty...

  20. All of the economic commentators including Lira seem to be dancing about the real and obvious issue. In a capitalist society, the government is owned by the people with the money. This is accomplished either through campaign financing or just outright graft and corruption. This has always been the case and it is an illusion that is constantly promulgated to our grade school children that the government is "by the people and for the people". In actuality, we live in a dictatorship of the corporation just as under communism, they lived under the dictatorship of the most ruthless. As far back as the American civil war, the rich could buy their way out of the draft and slaves were emancipated only in the states that had seceded. Union organizers in the early 20th century were fired and often beaten or killed with the complete cooperation of the local governments and police forces. Very sad that no one wants to face this obvious fact. Until and unless a way is found to isolate politicians from the power of money, there will be no solution to this problem. WM

  21. no, europe doesnt want the eu any more than we want the fed / you look at the europeans as though they are choosing their fate. No, are we Americans choosing our fate?

    You say /Denmark borders Germany - yes. /but you also say it borders ?Sweden / sorry. It borders Sweden like the USA borders Sweden. Denmark borders Germany - period. it is a fish swim to Norway and Sweden. Study your geography.

  22. As a struggling American I can only hope to see peoples of certain countries, such as Iceland or Ireland or Italy, Portugal or even rascally Greece, refuse to meekly surrender to the axe(more realistically, to the fleecing that their governments enforce).

    Please, Europeans, BLOW IT OUT! Maybe people here will become less docile and sniveling with examples in the news of action in Europe. Those of you living in THE REST OF AMERICA, not Washington/NYC, know that our economy continues to fail and actually drift downwards.

    The Great Depression hit most of the USA by 1921, when we no longer had a war torn Europe to buy our exports(grains AND munitions). Banks and small manufacturing enterprises failed in swarms well before 1929. The "Crash" was only the sound of a late alarm clock going off in NYC!

    As to some of the above, I don't see optimism in the REST OF AMERICA. I see deflation, depression and a fatalistic acceptance of the fact that we have lost, BIG MONEY RULES ABSOLUTELY. And... the oligarchs laugh at us while we are crushed. Sincerely, I am hoping to see many defaults.

  23. We are steadily approaching the point where we are going to see breakdowns in the political systems of the West ... and by "West" I mean Europe, the USA, the UK and Japan. That entire traditional banking system is insolvent and the political system supporting it is corrupt. Following a major breakdown, the people with the money (i.e. oligarchs and senior bond holders of the banks) will wage a personal takeover of important assets. Special thanks to commentator Gordon Long for explaining this in his most recent commentary. They will do whatever they can to prevent major losses from impacting their own riches - certainly including robbing the common people of their ownership of state and private assets. The breakdown is similar to what the USSR went through in transition to modern Russia.

    Each region of the Western system (Europe, USA, UK, Japan) will go through its own tumultuous changes. But don't imagine that "Defaults" will bring a better life to the common man. It will instead bring an end to the rule of law, and a much larger increase in the misery index.


  24. Touché! Great piece Gonzalo and I especially appreciate your analysis of France's role in this fiasco we call the EU. Having lived in Paris for the past six years, I've discovered that people accuse you of being a racist nationalist if you disagree with the EU - just goes to show how much people understand about the EU and how it operates.

  25. I'm an EU citizen. A "new" one, from the CZ.
    In 2003 I voted against joining the EU.
    I don't think we need central planners to travel freely. Politics and bureaucrats created borders. Now we should thank them for removing borders?

    EU is the same evil empire as Soviet union. In 1989 I hoped it's over, but it's here again.

    I hope bailing out PIIGS will be for EU the same as war in Afghanistan for USSR - that it will make them (financially and politically) bleed to the dead.

    So more bailouts please!

    The good think is that we didn't adopt the EURo. It will allow us to buy Au and Ag longer and cheaper so we'll be prepared better for the final crash.

  26. The long-term plan for the eurozone as a single entity is perhaps not so bad. Yes, austerity causes unemployment in the poor nations. But keep in mind: especially the richter member nations are at the beginning of a demographic disaster, with nowhere near the repopulation rate. If workers can be displaced en masse to northern nations, then it could mitigate both problems somewhat.

  27. Interestiung post.This is pretty basic, as the world churns towards metldown similer to what happend after the first world war. Resources will be at a premium.

    The difference is unlike back then we now have technology, ability to wipe out millions, if not billions of people with in hours or days of escalation.What the powers that be have not figured out yet, as more and more of the common man stops and says enough is enough the more likely things will escalate.You cannot take wealth with you when you are dead.You cannot eat gold,silver or paper.Every person alive is with in one shot of becoming just another corpse.
    We are heading into a resource world war, the likes the world has never seen. The end of the conflict will leave man with a population so damaged genetics wise, we most likely will not survive it long term.Greed and corruption corrupts absolute.

    Best advise : Prep like mad. Hope for the best prepare for the worst.

  28. RE:Switzerland and the EU.

    Switzerland is not a eurozone member because, although the political leadership rather desperately wanted in on the union, legally the only way to do such a monetary union is through a Swiss-wide referendum—and the Swiss political leadership knew that they would lose any such referendum.
    There actually was such a referendum, in 1992 and again in 2001; the EU lost large with 75% against. Many Swiss are now dead thankful for that votation.

  29. "This is natural—and completely predictable: You ever see a schiphrenic have a break-down when he’s happy, high, and just got laid? No you do not—he only has his little “episode” when he’s stressed."

    What about medication! - QE stuff. Just wait until the medication is taken away. Drooling sorryful bastards is what will be left.

    Regarding the TV. God forbid if the TV went off, such as from a solar flare or something like that. The country might just wake up fighting.

    No wonder why so many are packing up and leaving on the jet plane. I'm staying. I'm courious. (I live in the not so wild woodless plaines of Kansas).

    Nice article GL. It helped clarify some of the pieces missing in my limited understanding of the EU. Maybe someone should have rounded up the crazy bastards that first pushed for all this and sent them to Siberia to cool until they came to their senses.

    Over and out from Kansas.

  30. I'm drunk.. But would like to comment anyway.
    I'm Swedish, have lived in the US and now live in the Netherlands(for about 12 years now).

    First off, the EU is a totalitarian dictatorship, there is less democracy in the EU than there is in communist China.

    Second, you're absolutely right about this being about saving banks particularly in France and Germany. Their banks put everything into bonds of the "peripheral" countries as they offered the highest interest on their bonds while having to pay back in Euros. They had no way to play the currency card.. A euro is a euro and you'll have to pay it back even if you have no control of the currency whatsoever(actually only France and Germany have that. Coincidence?).

    Third, Christine would be a fantastic choice for the IMF. You need to understand that the IMF is a for profit organization representing the banks. Christine has been instrumental in putting all the pressure on the populace and none on the banks and will continue to do so, which makes her a very likely candidate for the IMF. They want their money back and with interest, that's their business.

    Fourth, Europe is a geographical thing, not political, cultural, linguistic, economical, military or anything region. All they have in common is the name of the continent "Europe", they don't even have a flag or "pledge of allegiance" or anything in common. If I just drive 3 hours I can't understand a word of what they say here, since the speak a different language(French). Even if I did they won't understand what I mean since their way of doing things is completely different to what I'm used to(culture). The EU is a politicians wet dream, the power to rule them all!!! But we're not "European" and never will be! We stay French, Russian, Polish, Spanish, Swedish, Greek, German...

  31. Gonzalo,
    you had me at "Finland First/Fuck Foreigners"!

    God that has to be the funniest line I've read in months. You vulgarian. We heart Gonzalo.

  32. I couldn't agree more on GL. It is an excellent analysis. The European train is on the course of train wreck. When it finally happens, it will be an upheaval with unbelievable consequences. Europeans have been living a good life ever since World War II. They have not suffered any major disaster yet. The coming financial disaster is alien to them. One can hardly imagine how they will handle it. With disparity in the income level in different countries, it is conceivable that it could lead to wars, because the survival of the country is at stake. As GL said, the personal agenda, country agenda are all above the interest of a common market. it is inconceivable that when it comes to crisis, rich country like Germany will extend a helping hand to help poor countries. Even if she would, it is beyond her means. Look at the burden West Germany lifted the East Germany. God bless you all.

  33. GL, thought you were going to keep posting on your normal site???

  34. Gonzalo I like your stuff and all, but you are losing your readership every day you don't post. I know you are young and impatient, but you just haven't been around long enough and are not proven enough to be acting this way. Post or be toast, man, get with the program....

  35. Well this was all predictable - now that he has his paid baby to tend to, his regular blog gets ignored, just as someone predicted on the thread when he announced his premium service. It also ticked me off that "The Trooper" went along for a while and then got cut off without notice, and before its culmination. I am fast losing interest in checking this blog.

  36. Lira has a paid site. You want to read him everyday, then PAY. Otherwise, be happy with reading him once a month or once a year.

  37. The paid site sounded weird: fiction and conjecture, not intelligent commentary and research. And how is he going to attract people to the paid site, without some sort of exposure to the public? Most people have never heard of Gonzalo Lira. He is not a professor from Princeton...

  38. @Jocesito: Or not at all...dude, it's not like I am going to have trouble sleeping because I can't get his latest info;I enjoyed his blog and got to where I checked it a few times per week. But he jumped into a crowded pool with the concept of his new site...

  39. No posts in 3 weeks= Time to dump GL for newer and better. I for one, have found myself reading Dont tread on me and SilverDoctors. The Doc's Silver Viral Project has enormous potential as well.

  40. Reading the last comments, maybe GL should post "teasers" of his paid for articles here, just for debate and hyping interest... That will help people make the decision to pay for more or not..

  41. to us in england..its wonderful...let the whole toletarian europa collapse,then we can turn on our political bastards in britain...rather be poor than living in this european least a bankrupt europe they,ll be eff all for the hordes of islam,britains a pc police state which is ruled by bastards who care about appeasing these retards from south asia,good times are coming,the collapse will rescue blighty


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