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Greece and the U.S. Taxpayer

May 4, 2010

From the Richmond Tea Party

If you answered: “WE ARE!”, you’re absolutely correct! Here’s the latest and greatest on the bankers’ rape of the U.S. taxpayer.

Many of you are following the “Greek Tragedy” that is, well, Greece. The Greek state joined the European Union a few years ago, under false pretenses. You see, there are sovereign debt limits imposed by EU membership. In order to meet the requirements for membership, Greece hid some its debt with the aid of an accounting scheme, courtesy of …a big Wall Street bank that will remain unnamed! Imagine hiding debt off balance sheet to make yourself look good! Who’d do such a thing? It’s shocking!

Now, Greece has a very generous government which, by the way, is the source of its debt. Funny how that works! Greece is apparently a very nice place to retire:
http://www.nytimes.com/2010/03/12/business/global/12pension.html?hp
As a consequence of decades of bargains struck between strong unions and weak governments [don’t forget the banks!], Greece has promised early retirement to about 700,000 employees, or 14 percent of its work force, giving it an average retirement age of 61, one of the lowest in Europe.
The law includes dangerous jobs like coal mining and bomb disposal. But it also covers radio and television presenters, who are thought to be at risk from the bacteria on their microphones, and musicians playing wind instruments, who must contend with gastric reflux as they puff and blow.

[In Greece, hairdressing is high-risk work, and a Greek hairdresser can retire at age 50 with full benefits. No kidding!]

According to research by Jagadeesh Gokhale, an economist at the Cato Institute in Washington, bringing Greece’s pension obligations onto its balance sheet would show that the government’s debt is in reality equal to 875 percent of its gross domestic product,

So as even a Congressman can see (but would never admit), Greece is bankrupt! That means they need a bailout! And so, a bailout they shall have! But where to get the money?

That’s where YOU come in! See, the money is coming from the IMF, which recently raised its international bailout fund from a paltry $50 Billion to a much more fun $550 Billion! And, you might ask, where does the IMF get its money? YOU GUESSED IT! THEY GET IT FROM YOU, DEAR TAXPAYER! The U.S “share” of the new higher IMF international bailout fund is $100 Billion! See? This finance stuff is fun!

And what does dear leader have to say about this? According to GreekReporterUSA:

“The budget and debt crisis in Greece is “of great concern” to President Barack Obama, White House spokesman Bill Burton said today.
“We’re monitoring it very closely,” Burton told reporters traveling on Air Force One with Obama to a speech in Quincy, Illinois. Treasury officials “are in close contact with folks in Europe about the issue.”

Yeah, we’re “monitoring” it like crazy, and we’re sending them big bundles of taxpayer cash! We stashed them behind the third column at the Parthenon! Woo-Hoo!

But Wait! There’s More!

Normally, when someone bails out a bankrupt firm, they get something! Most importantly, they get to be first in line to be paid back! BUT NOT THIS TIME, SUCKERS! You see, contagion is ragin’ in the EU, Spain is next (and much much bigger) so we gotta act FAST! Most of bankrupt Greece’s debt is held by…banks! And goodness knows we can’t let the banks ever lose a penny, or a farthing, or a pfennig, or whatever a penny is in Euros!

So the Greek bailout deal looks like this:
http://www.eurointelligence.com/article.581+M53ce1416b72.0.html
• The package would be in the order of €100-120bn for three years, during which Greece would be taken off the market. (Germany‘s economics minister said that Germany contribution would be €8.4bn each year for three year running, with a risk on the upside. The Germans had apparently thought that the €45bn would be the total size of the package)
The package will contain no element of restructuring and rescheduling
The loans will be junior to those of the existing bondholders.

Those last two are a barrel of laughs! It means the banks will be repaid in full, AND before the IMF (read: US taxpayers)! In other words, the banks will be repaid in full on their bad loans to Greek extravagance, and the taxpayers will take the losses! So Greece is being used just like AIG, as a passthrough, a shell game, a “fraudulent conveyance” to steal money from the US taxpayers and give it to the banks! How unique! And this time, THEY’RE EUROPEAN BANKS! BONUS TIME, BAYYYYBEEEE!

But wait! There’s still more! This just in! JPMorgan and Morgan Stanley hold a combined $69 Billion is debt in the troubled region! So not only are you bailing out European banks, you’re bailing out our old friends on Wall Street too!
http://www.bloomberg.com/apps/news?sid=a7h1lGnar8Gg&pid=20601087

April 29 (Bloomberg) — JPMorgan Chase & Co., the second- biggest U.S. bank by assets, has a larger exposure than any of its peers to Portugal, Italy, Ireland, Greece and Spain, according to Wells Fargo & Co.

JPMorgan’s exposure to the five so-called PIIGS countries is $36.3 billion, equating to 28 percent of the firm’s Tier-1 capital, a measure of financial strength, Wells Fargo analysts including Matthew Burnell wrote today. Morgan Stanley holds $32.4 billion of debt in the region, which equates to 69 percent of its Tier 1 capital, Burnell wrote.

Someone put a bandaid on me, I’m bleeding to death here!

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