Crisis

There’s nothing more frustrating than watching this endless cycle of stupidity unfold. Sometimes it’s just more dignified to face death rather than fight it.

To regular readers, it will sound like a tiresome cliché by now, but the fact that capitalism never solves its own crises was driven home once more last week by the outcome of the much-anticipated European Union crisis summit in Brussels on Wednesday. Yet again, European leaders managed to stave off an immediate catastrophe by buying themselves some extra time. But, yet again, the fundamental problems remain unresolved.

Here’s a list of points that European heads of state agreed upon:

• Private creditors will “forgive” 50 percent of Greece’s sovereign debt.
• European banks will be recapitalized to the tune of 109bn euros.
• The European Financial Stability Facility (EFSF) will be ramped up to 1 trillion euros.

And here’s a list of reasons why this is nothing but hot air:

With Greece on the verge of default, Italy sucked into the storm, and French banks drawing ever closer to collapse, the euro has finally reached its endgame.

All that is solid melts into air. What we are experiencing at present will define our era for centuries to come. Precisely twenty years after the final collapse of the Soviet Union and the demise of state communism, we are now approaching the endgame for the European Union and the potential demise of European capitalism. The train of economic integration has come grinding to a halt. These are tectonic shifts in world history. But our leaders seem largely oblivious to it.

In many ways, this year has already made its mark upon history: 2011 is the year of revolution, war and crisis; of terror, truth and disaster; of revenge, revolts and riots. But, as we predicted in an article back in December 2010, it might yet be remembered as the year of collapse. None of the underlying causes of the enduring global financial crisis have been addressed. Indeed, the chosen policy response — draconian austerity measures — has only made matters worse.

Fears of financial Armageddon proliferate as the global economy stutters, investors abandon hope and the euro teeters on the brink of collapse.

“This was the week that investors abandoned all hope,” the Financial Times dramatically reported on Friday. “Fears of a new credit crunch caused share prices to plummet on both sides of the Atlantic,” the Guardian wrote, ”as fragile banks struggle to raise funds in financial markets.” As a result, the shares of some of Europe’s largest banks fell to their lowest point in two years, while those of US banks fell back to levels unseen since the collapse of Lehman Brothers.

US borrowing costs fell below 2 percent “for the first time in at least 60 years,” as investors, wary of stagnating global growth and a renewed financial meltdown, scurried into traditional safe havens like gold, Swiss francs and treasuries. “There is a serious concern that you are going to get recession sooner or later,” said Jim Reid, credit strategist at Deutsche Bank. “It is a phenomenal period in history.”

What is going on in Athens at the moment is resistance against an invasion — and this invasion is being justified with the extensive use of mythology.

By Alex Andreou, originally published on SturdyBlog

I have never been more desperate to explain and more hopeful for your understanding of any single fact than this: The protests in Greece concern all of you directly.

What is going on in Athens at the moment is resistance against an invasion; an invasion as brutal as that against Poland in 1939. The invading army wears suits instead of uniforms and holds laptops instead of guns, but make no mistake – the attack on our sovereignty is as violent and thorough. Private wealth interests are dictating policy to a sovereign nation, which is expressly and directly against its national interest. Ignore it at your peril. Say to yourselves, if you wish, that perhaps it will stop there. That perhaps the bailiffs will not go after the Portugal and Ireland next. And then Spain and the UK. But it is already beginning to happen. This is why you cannot afford to ignore these events.