Warning: The EU Crisis is Back and will Only be Getting Worse!
- WARNING: The EU CRISIS IS BACK AND WILL ONLY BE GETTING WORSE!
by Graham Summers, via http://www.goldseek.com/
I want to issue a major warning to investors: the EU Crisis is going to get worse in the coming months.
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I realize that most investors and analysts believe that the EU Crisis is over. They think that because the S&P 500 closing in on its all-time highs shows that things are fine in the system. They are wrong.
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The only item that held Europe together in 2012 was the credibility of EU politicians and ECB President Mario Draghi. Please note that nothing fundamental improved for the EU’s financial system: EU GDP has since re-entered a recession and EU unemployment has a hit a new record.
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Indeed, the only reason things even looked better was because various Government engaged in massive interventions. In the case of Spain, this included raiding 90% of their social security fund to buy Spanish bonds so that yields would fall.
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So… when you entire financial system is held together by the credibility of the political class… corruption scandals can implode the system.
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MADRID — Spain’s governing Popular Party was drawn deeper into a web of corruption scandals this past week, after the Swiss authorities informed the Spanish judiciary that the party’s former treasurer had amassed as much as 22 million euros, or $29 million, in Swiss bank accounts.
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The treasurer, Luis Bárcenas, resigned from his job in 2009, after being indicted in the early stages of an investigation, which is still ongoing, into a scheme of kickbacks and illegal payments allegedly involving other conservative party politicians…
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Nonetheless, the revelations have brought a fast-growing list of corruption investigations, which have unspooled across Spain, to the doorstep of the conservative government of Prime Minister Mariano Rajoy, who has so far remained silent. About 300 Spanish politicians from across the party spectrum have been indicted or charged in corruption investigations since the start of the financial crisis. Few have been sentenced so far. Source: NY Times
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read more!
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