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Geopolitics trumps everything! No way will NATO and EU let Greece leave Europe to find prosperity in Russia and China’s arms

Neither NATO nor the EU can afford the political cost of a Greek exit from the EU. The simple fact that Greece will align with China and Russia is reason enough for Merkel and Co to give in to any demands Greece may have.

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Post originally appeared on Euro Pacific Capital.

Based on the continued failure of the negotiating parties to make any substantive progress in the talks over Greek debt payments, the financial world is tied up in knots over a possible Greek exit from the European Union. The uncertainty has manifested in both high and low finance, with a sharp sell-off in bonds, particularly EU and Greek government debt, and heightened retail withdrawals from Greek banks as depositors become wary of capital controls that would be imposed in the case of an exit. All concerned parties should likely breathe easier. Despite Greece’s almost complete lack of financial integrity, neither NATO nor the EU can afford the political cost of a Greek exit from the EU.

The unacceptable specter lurking behind the EU negotiators is that, if Greece is shown the door by the EU, Russia or even China might step in to provide financing to Greece in return for a strategic foothold in Western Europe and gateway to the Eastern Mediterranean. This is a possibility that Europe cannot abide. In short, international political ramifications will trump any economic or financial issues.

As reported several months ago in this column, modern Greece has been used continuously by Europe as a bulwark against unwanted incursions. In the 1820s, Greek independence from Ottoman Turkey was financed and supported by Western powers as a way to contain and rollback Turkish influence in the Mediterranean. In the 20th Century, Greece became a key battleground of the Cold War, with the West expending considerable blood and treasure to ultimately keep socialist Greece from falling into the Soviet orbit.

Although the Greeks received countless sums from abroad, Greek governments have been notoriously feckless, and have been instrumental in ensuring their nation’s economic demise. By opting for generous socialist entitlements and blatantly anti-capitalist regulations, Greek governments decided to borrow irresponsibly to meet its obligations.

With the formation of the European Union (EU), strenuous efforts were made to include Greece to prevent the rise of Communism. This encouraged the surreptitious acceptance of untruthful economic statistics to facilitate Greek membership, both of the EU and the Eurozone.

Eurozone membership gave Greece access to vast amounts of cheap debt, offered largely under the false assumption that an early conclusion of a single political union would offer an implied EU guarantee for Greek debt. It was similar to investors assuming, erroneously, that the debt of Freddy Mac and Fannie Mae carried the ‘implied’ guarantee of the U.S. Government.

But, as was the case with Fannie and Freddy (whose collapse many believed would have plunged the U.S. into deep Depression), the political cost of failure was too great to accept. Therefore, the financial costs of technical failure had to be borne by citizens. In addition, over the past few years, much of the Greek debt has been transferred from EU banks to EU governments that have the much abused ability to pass the bad debt onto future generations of their citizens.

Likely aware of this, the Greek government has faced off repeatedly against some of the world’s most powerful politicians and central bankers, winning time and yielding little.

Even more importantly, when Greece’s socialist Prime Minister Alexis Tsipras faces Germany’s Chancellor Angela Merkel, he knows that she is acutely aware that any soft deals offered to Greece may be seen as a precedent encouraging Portugal, Ireland, Italy and Spain to push (even acting as a united block) for similarly favored treatment. Furthermore, any perceived increase in the prospect of a potential break-up of the EU might encourage voters in Great Britain, in the 2017 referendum, to vote to leave a sinking ship. A British exit could put an end to the European dream and place at risk trillions of dollars’ worth of European debt and even the Euro-currency itself.

In addition to these serious concerns, Merkel has one overriding fear. Should talks break down, Greece will likely go searching for other sources of funding. It may find many willing givers, all with strings attached. Russia may offer funding to Greece in return for a naval base. If not Russia, even China might attempt to offer a vast, soft funding rescue package in order to buy entry to the European and NATO landmass. It is no secret that China has a strong interest in taking over operations of the Port of Piraeus, one of the largest ports in the Mediterranean.

While Merkel and her supporting fellow EU leaders may talk tough to Greece’s leaders, they know it is politically unacceptable to allow a financial default to open the way to EU dissolution or the slightest possibility of a Russian or Chinese strategic incursion.

As a result, whatever the eventual financial costs to EU taxpayers of a Greek default, the political costs of a Greek exit are likely to be seen as unacceptable. Therefore, after much posturing, delays and threats, I believe that the chances of an actual Greek exit are far lower than are commonly believed. Most likely the EU will allow a covert Greek default, disguised for the time being by extended repayment schedules, bogus refinancing formulae and possible delayed haircuts as bonds mature. They may insist that such moves are not a technical default. Despite that absurdity, our obedient press corps may even concur with such a characterization, and investors may be so thrilled that a relief rally occurs in stocks and bonds. Extend and pretend will once again be the only acceptable manner to confront our intractable problems.

References:

http://www.europac.com/commentaries/geopolitics_will_trump_economics_greece

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Seraphim Hanisch

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Fox News reported on March 19th that one of America’s most well-known TV news anchors, Ted Koppel, noted that the once-great media outlets like The New York Times and The Washington Post, have indeed traded journalistic excellence for hit pieces for political purposes. While political opinions in the mainstream press are certainly within the purview of any publication, this sort of writing can hardly be classified as “news” but as “Opinion” or more widely known, “Op-Ed.”

We have two videos on this. The first is the original clip showing the full statement that Mr. Koppel gave. It is illuminating, to say the least:

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There are probably a number of people who have watched this two-year onslaught of slander and wondered why there cannot be a law preventing this sort of misleading reporting. Well, Russia passed a law to stop it, hitting dishonest media outlets in their pocketbook. It is a smart law because it does not advocate imprisonment for bad actors in the media, but it does fine them.

Going to prison for reporting “the truth” looks very noble. Having to pay out of pocket for it is not so exciting.

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Lori Loughlin’s daughter was aboard USC official’s yacht in Bahamas when mom was charged

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The Duran

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Via Fox News


Lori Loughlin’s daughter Olivia Jade Giannulli was spending spring break on a University of Southern California official’s yacht when her mother was accused Tuesday of involvement in a college admissions scheme, reports said.

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Loughlin’s daughter has since returned to Los Angeles to face the allegations that could result in her getting expelled from USC.

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Via Zerohedge


CNN is about to be sued for more than $250 million for spreading fake news about 16-year-old Covington High School student Nicholas Sandmann.

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They really went after Nicholas with the idea that he was part of a mob that was attacking the Black Hebrew Israelites, yelling racist slurs at the Black Hebrew Israelites,” continued Wood. “Totally false. Saying things like that Nicholas was part of a group that was threatening the Black Hebrew Israelites, that they thought it was going to be a lynching.”

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Watch: 

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