Monday, November 29, 2010

Must-Read Here On Ireland/Europe...

This guy writes great commentary which is succinct, provides keen analysis and is 100% on the money.  The bottom line is that the "financial" crisis unfolding in both the Europe and the U.S. is of a banking nature.  That is, big banks fueled by absurdly easy monetary policy by Central Banks, have loaned impossibly excessive levels of debt to both Governments and the private sector:
So we must focus on the banks, because they are at the heart of the real crisis...The importance of Ireland is that is the biggest cross-border banking debtor of all the PIIGS.  If the Irish banks are not saved, the European banking system will probably go under, and soon, without waiting for the pressure to mount on Portugal Spain and Italy...
Here is the link:  Bad bank loans

In other words, the U.S./Euro solution to the financial meltdown occurring behind the scenes is one of excessive credit and catastrophic public policies being implemented by the U.S./EU.  To paraphrase a famous quote:  "it's the banks' money but it's the public's problem."  This is was TARP/QE round 1 did in the U.S., shifting a massive amount of money from bank balance sheets to the Treasury.  QE2 is doing the same and soon we will get TARP2.

Understanding the truth behind the rhetoric will enable everyone to understand why gold/silver is so resilient in the face of a big dollar dead-cat-bounce-rally.  At some point the markets will realize this and gold/silver will begin another meteoric rise. Sooner rather than later would be my bet...

1 comment:


    Hmm... Bank of America?