The German high court has issued a stunning attack upon the European Central Bank, arguing that its rescue plan for the euro violates EU treaty law and exceeds the bank’s policy mandate. Anyone who studied just one semester of law understands that this decision is right on point. One of the primary reasons I disagree with conspiracies to rule the world as if someone was really in control, has been the fact that I have been Behind the Curtain since the 1980s. There is no all-powerful group who knows what the heck they are doing. Everything is purely ad hoc and it is far worse than anyone can even guess. Sure, there are conspiracies to manipulate a given market and make money short-term and then they troll for the next scheme. But to think someone is actually behind this mess mapping out the future for society as if this was part of a giant plan, well you are attributing the power of God to man. Sorry – you are so off base it isn’t even funny. This is total chaos and politicians simply respond to whatever event is immediately before their eyes without ANY concept of the long-term. This is one step at a time without any sense of where they are even headed.
When the European Commission was designing the Euro, they came to our London Seminar and took the entire back row of seating. I had conversations with the people Behind the Curtain and the German Central Bank use to provide us with details on the upcoming Euro because they could see it would fail. I KNOW what went on – this is not speculation or theory – I was there. I explained that the ONE-SIZE-FITS-ALL would fail and that there had to be a consolidation of national debts consisting of ALL member states for the currency to become a RESERVE currency. The hype that the Euro would replace the dollar was total nonsense and all those who promoted such ideas were clueless prejudiced dollar haters – not analysts who let the facts speak for themselves.
The German high court has delivered very tough language leaving it questionable whether the ECB’s scheme for Spanish and Italian bonds can even be implemented when Europe’s debt crisis blows up again. The design of Europe is completely a disaster for it is a patch work just to grab power and then hold it without any long-term design other than retain control by the federalization of Europe. From the outset, the planners did not consolidate the debts because they did not think the people would vote for the union if there was any implication of a bailout for some countries. Therefore, they focused ONLY upon creating a single currency PRESUMING that this was why the US economy was what it was. Today, they just will not allow the people to vote and have eliminated democracy for what they see as the “greater good” that is always their self-interest.
I desperately tried to explain that you could not create a single currency to rival the dollar if major capital could not “park” in bonds of one major unified state. The planners assumed that leaving the debts spread-out among all states would work since they would be denominated in the new currency. They ignored individual credit risk that was the very fear that the people would not vote for their scheme if there was a debt consolidation. The planners tried to over-power the free markets by assuming one central bank interest rate would suffice ignoring credit risk. This was a COMPLETE and ABSOLUTE failure to understand how markets even function and Europe is now a total basket case using band aids to try to patch wounds that need surgery.
The German high court has read the treaty and is absolutely correct. The politicians are just trying to deal with the errors they originally made and refuse to reform the entire process leading to illegal acts just to try to hold this mess together. The German high court has to be commended for its honesty, for surely the US Supreme Court would never take such a step against its appointing politicians. This ruling by the German high court greatly complicates any future recourse to quantitative easing if needed to head off Japanese-style deflation.
The German high court did refrain from issuing a final ruling on the legality of the plan, that is now known as Outright Monetary Transactions (OMT). Instead, it referred the case to the European Court after providing a pre-judgment of the issue making it more difficult for the European Court to bless the politicians as would the US Supreme Court. However, in the middle of the next crisis, the ECB will still act and the European Court will bless the ECB seeing this as a no choice decision to save Europe. Nevertheless, the German high court has made it clear that it considers “the OMT decision incompatible with primary law”.
It is time to just turn out the lights and save energy. This design will not work and the very idea that a federalized Europe would eliminate war is in fact feeding the very seeds of war by the economic disaster they have created that leads to finger-pointing and old wounds.
