What are the odds of Ben Bernanke becoming President of the United States?
Most people would tell you it’s impossible. Who would let a Central Banker become the leader of a country? Any Central Banker would be entirely too fraught with questions of corruption and questionable interests to be a serious contender for leader of state.
Moreover – what do you think the odds are that Ben Bernanke will be appointed (not elected) to be in charge?
Pretty much out of the question, right?
Well, take a long look over the Atlantic Ocean to Greece and Italy.
On November 11, 2011 Greek leadership APPOINTED former European Central Bank vice President Lucas Papademos to take over as Prime Minister of Greece.
Then on November 12, 2011, Italian leadership APPOINTED former European Commissioner, Mario Monti to take over as Prime Minster of Italy. Monti wasn’t technically a central banker, but as a member of the European Commission, he oversaw capital controls throughout the Euro-zone.
I’m aware that the Prime Ministers of both Italy and Greece are always appointed – but you might say the same thing about our Electoral College process of appointing U.S. Presidents.
Yes, the Electoral College has so far taken its lead from voters, but there’s nothing specific to the Constitution guaranteeing that chain of command.
Now, we know that both Monti and Papademos were put in charge because of their backgrounds in economics – and that Italians have gone so far as to call Monti’s reign a "technocratic" regime.
Remember, monetary policy falls under the umbrella of Central Banks – stuff like managing interest rates and money supply. Fiscal policy relates to State spending, taxes and financial management of government.
So these two economist bankers/commissioners-turned-politicians have moved from the monetary side of the table, to the fiscal side. And now we’re seeing that they have no plans whatsoever to sacrifice the banking industry (the folks they formerly "regulated") in order to save the fiscal flexibility of the states they now run.
That’s why there are now riots in the streets of Athens – because Papademos is MORE interested in keeping the Euro-zone’s financial system whole than he is interested in creating a healthy Greek state.
Greek taxpayers and state employees are being asked to bend over backwards in order to accommodate European banks.
The way people like Monti, Papademos and Bernanke see the world is that financial systems must be saved at all costs.
Those costs include, but aren’t limited to, huge tax raises, decimation of all state functions and the complete raiding of a country’s treasury on the fiscal side, as well as massive amounts of money printing and market rigging on the monetary side.
Both of these actions are extremely bad news for the Euro as a currency. Who will want to hold this currency when they get nothing but punishment from their state and inflation from their central bank?
That’s what Europeans are looking at for the foreseeable future. As more and more of them realize the futility of their situation, they’ll likely try to start buying gold and silver. The politicians and central bankers will try to make it difficult and expensive to buy precious metals for regular citizens – which will only boost demand.
We’re in the eye of a very large storm right now. And being in the middle of this eye, holding the relatively stable dollar, it seems like nothing is really wrong with our currency.
But the storm will pass through Europe and over the Atlantic.
Here’s to knowing what’s coming,
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