Merkel Will Press Obama And The Fed To Help Bail Out The Eurozone.

TBI ^ | 9-13-3011 | John Ellis

[blam]

Merkel Will Press Obama And The Fed To Help Bail Out The Eurozone.

John Ellis
Sep. 13, 2011, 4:20 PM

We're at the end of "extend and pretend." The crisis of the Eurozone is now acute. The headlines are specific. The best analysis suggests that only extraordinary action can keep it afloat. And even that would work only to delay the inevitable for a month or two more.

The reality is that the Eurozone no longer offers any good option for continued unity. As an Italian policy-maker told Martin Wolf of the Financial Times, "it would be better to leave (the eurozone) than endure 30 years of pain."

At the center of the storm sits German Chancellor Angela Merkel, who is being told by one and all that she must take extraordinary action to save the day. But the truth is she doesn't have the authority to do so, doesn't have the votes, doesn't have the political throw-weight to over-ride the judicial, legislative and political vetoes. She won't save the day because she can't.

So what does she do?

In the days leading up to the collapse of Lehman Brothers, then French Finance Minister (now IMF Managing Director) Chistine Lagarde told then-Treasury Secretary Hank Paulson that he could not allow Lehman to fail. The ramifications would be catastrophic, she said. She was mostly right.

Three years later, it will be Angela Merkel talking to President Obama,Treasury Secretary Geithner and Federal Reserve Bank Chairman Ben Bernanke with exactly the same message. The United States government and the Federal Reserve must come to the rescue of the Eurozone or the ramifications will be catastrophic. And she will say that she needs roughly $1 trillion in financial guarantees and liquidity support. That's the number that will calm the markets.

(snip)

[Orange1998]

I wonder how Ben is going to explain to the American People the bailout of Greece. Additional debt on the back of our children for the greater good of the World banksters.

[353FMG]

Sheesh, wasn’t the Marshall Plan not enough to start your Wirtshaftwunder going?

Why did you have to blow it on month-long annual vacations for everybody and other social goodies while we took care of your defensive needs?

[Iron Munro]

They will do it.

They will do it under the table.

And they will lie and cover up the details just as they have covered up payment of TARP money to foreign banks and others.

[tdscpa]

The US should help her out. The assistance should be limited to a coach class airline ticket to China.

[DarkWaters]

And yet it will only kick the can down the road a little longer. In 2008 and after the fed printed up about 16.3 Trillion dollars to bail out overseas banks ( I presume some of that was for the banks here as well) and yet here we are 3 years later. The next crisis won't be held off for another 3 years either. Two if they are luck, and it won't cost 16.3 trillion. You will probably have to at least double it.

[aruanan]

Elsewhere was this headline: "Merkel: Greek default would destroy faith in Europe...."

WWI and WWII and then their dopey European Union pretty much did it for me.