Thursday, January 27, 2011
Latest News from the Auld Sod
I generally only blog when events merit and on January 18, we had one of those events. The news from Ireland was simply stunning. It seems that the building pictured above which looks more like a parking garage than the Irish Central Bank had done the unthinkable. It had printed $51 Billion Euros out of thin air, with no backing whatever and handed them over to the insolvent Irish Banks who were continuing to suffer from an ongoing bank run. Many banks around the world are insolvent and the Irish Banks are among the worst in that respect. To my knowledge this money printing is unique in the history of the Euro. The early reports were not clear to me whether the money was the result of a keystroke transfer to the Irish banking system or was in fact euro printing. In fact it may have been both but I did discover(Wikipedia) that Euro notes have country codes on them listing which commercial or national printing press did the printing. Euros with the letter “T” are Irish euros . What this central bank did presumably with the permission of the European Central Bank is pure and simple money printing exactly as done by Zimbabwe and the 1920’s Wiemar Republic. What stunned me even more was the deafening silence in the European Press. I would have assumed that the German Public would have rioted in the streets. If one country in the Euro community can print money without issuing debt, why can’t they all do the same ? I guess the Irish decided that if Ben Bernanke can employ QE to feed to America’s TBTF banks, then so can they. The process is fundamentally the same in both countries but the Irish did it baldly and directly. Who will be next? Greece obviously along with Portugal, Spain, Italy. It is amazing to me what the banks of the world will do to save their fat asses and how little the world notices. People! This is a big deal. German People! French People! It is time to march on your central bank and demand and explanation and reversal of this crime against your currency. IF this act is not reversed, I cannot imagine how the Euro can survive.