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How I Solved The Euro Crisis and US Debt Crisis.

TheR 2012/06/30 03:03:35
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This economic plan will provide the time frame needed in halting the collapse of Banks in Europe and in the USA, from having so much debt.

Essentially what we must do is Mortgage the Future. It is a very similar plan to How I Solved The Housing Mortgage Crisis in the USA.

http://www.sodahead.com/united-states/how-i-solved-the-housin...

What needs to happen is the USA needs to Buy Europe's Debt, and Europe needs to Buy the US Debt. Loans are created by both countries from the World Bank. When the US buys Europe's Debt, it essentially pays off Europe's Debt, and makes Europe free of debt. The same happens when Europe buys the US debt. The US now becomes debt free. The point is now the US has Europe Debt it is responsible for, and Europe has the US Debt that it is responsible for.

These Loans can be manufactured to be due in payment say in a 10 year cycle. When the 10 year cycle happens on that day, Europe goes to the World Bank and borrows enough money to buy back it's original debt the US bought from them. On that same day, the USA goes to the World Bank and borrows the money to buy back it's original debt it sold to Europe.

This means both Countries finance each others debt, allowing each country to maintain a good long lasting solvent Credit Rating.

During the 10 year cycle in which payment is due on the last day of the 10th year, when both Countries buy back their Debts, the US and Europe are free to borrow within their respective countries to create growth in their Economies. They borrow money, and they also maintain austerity measures in government spending.

This means the Private Sector can borrow for job creation and growth while governments are held toe to the line in Austerity. Please note this will work only when countries realize they must do both, in doing Economic Growth, and in doing Austerity.

In time it is expected that European Debt and US Debt will be reduced because of the Growth and Austerity measures. So when the 10 year cycle is due for payment, the payment will be less than what they both sold them for.

This plan is not creating more debt. It is not debt. What it is, is buying debt. You are creating stable credit, which you know will be paid off in 10 years. My idea is buying debt, not creating it. You assure the markets that debt is stabilized, and once you know that, you can begin a Growth Economic Model for the Private Sector, while at the same time implementing Austerity on the Government. When someone buys off your debt, you are now debt free. When you buy someone else's debt that is not due until 10 years, you are essentially debt free for 10 years. This means you have the time to establish Growth, while implementing Austerity at the same time. This will essentially bring down the debt factor. In 10 years, Europe is required to buy it's debt back , in order to adjust its debt accounts. The accounts should be lower. When seen lower, Europe and the US can then resell their debt again to each other, to provide another 10 year period of being debt free. And the same process, until the debts on both continents is low enough where selling and buying back debt is no longer required.

This ultimately weans the World from Total Economic Collapse. The following will explain the European Crisis. We should note that the US must take the leadership in promoting this effort, which in my opinion will be a dual Marshall Plan in the 21st Century.

Note: The following Article was Published by The 4th Media, that provides a good understanding of the Financial Crisis. I did not write the article, and give all links and credits to their author. The reason I post the article is due to Security Issues, in which sometimes just posting links does not work. You click the link and it comes back as a Page Not Found. So in order to assure the available information I include the Article and link, and make it clear the article was not written by me.
crisis leadership promoting effort opinion dual marshall plan 21st century

For The First Time The New World Order In Panic: The International Establishment Face A Crisis

Posted: 28 Jun 2012 11:42 PM PDT

For the first time in my career, I see the international establishment, sometimes called the New World Order, facing a crisis so large that its very survival is at stake. For the first time, these people are scared.

There are not many of them. In his book,
Superclass, author David Rothkopf estimates that there are only about 6000 people at the top of the pyramid of world power and influence. They are mostly males, and at least a third of them have attended America’s most prestigious universities. Most of the others have attended comparable universities in Europe.

The crisis in Europe is clearly beyond anything that this generation of establishment leaders has ever seen. The last time that anything like this faced the European establishment, it led to World War II.

During the entire postwar period, the United States has been the dominant force in the West. The United States government through the Marshall Plan wrote the checks to keep the European governments afloat, and it funded most of NATO, the mutual defense system that was set up to constrain the expansion of the Soviet Union.

The United States is no longer in a position to bail out anybody. It is running a massive trade deficit, and is running a massive federal deficit. Europe realizes now that, from an economic standpoint, it is on its own. If there are solutions to the European economic crisis, these solutions are going to have to be generated inside the euro zone.

Rest of Article Can Be Found Here:
http://www.4thmedia.org/2012/06/29/for-the-first-time-the-new...

CONCLUSION

Angela Merkel can scream, yell, and hold her breath until she turns blue, but ultimately she has no power over the European Central Bank. Ultimately, no politician has any power over it. No politician really wants power over it. Why not? Because that politician would then be responsible for coming up with the money that the European Central Bank was about to come up with, but which was stymied by the politician.

This is why the European Central Bank is going to inflate, inflate, and inflate. The head of the bank can make all the comments he wants about the responsibility of politicians to intervene to keep the structure going, but he is ultimately the bagman of the system. He is the guy who has control over the printing press. He is the only person, along with his colleagues, who is in a position to keep the system afloat.

There is no firewall. There is only the ability of the European Central Bank to create money, and to do so by lending it to commercial banks or directly to governments. It does not matter what kind of rules and regulations are in place that were supposed to prohibit this back in 1999.

In the midst of a conflagration, nobody in power is going to point a finger at the European Central Bank when the bank intervenes to bail out a government that is about to default on its debt. The reason is clear, or at least is clear to me: no politician wants to be responsible for coming up with the money to bail out the largest banks in his country, all of which will be threatened with insolvency because of the default of Greece and Spain, because that will produce a domino effect by all of the PIIGS governments.

June 23, 2012

lewrockwell.com/north/north1159.html

Gary North [send him mail] is the author of Mises on Money. Visit www.garynorth.com. He is also the author of a free 20-volume series, An Economic Commentary on the Bible.

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  • flaca BN-0 2012/06/30 04:01:59
    flaca BN-0
    Banks are submitting their "Living Wills" here in the US. What is your plan for when your bank becomes financially insecure/threatened? Each major bank has had to put forth a plan. E.G. the CEO is ousted, a panel takes over the company and starts selling off assets or whatever. The whole thing is designed to ensure that banks don't get bailed out again. I'm sure they hated drawing up their living wills, but they're all complying.
  • TheR flaca BN-0 2012/06/30 10:48:28 (edited)
    TheR
    The President and US Bankers such as Tim Geither, and Ben Bernake must have a meeting in Europe to talk to EU leaders,and World Bank, & IMF Officials. to agree on EU buying all of US debt. Or at least an equal amount as the EU now has. Present Banks in the USA would be insured by The US Treasury, and Federal Reserve. The talks would be to make a Contract with the EU for them to Buy US debt, per the same amount as the EU has, and the USA would buy EU debt. The debt payment would become due in 10 years. Upon that time, the EU buys back it's debt from the USA, and the US buys back it's debt from the EU.

    Then according to my article follow the Economic Growth model for the Private Sector and implement Austerity Measures on both Governments. Upon the end of the 10 year cycle it is predicted that both nations will have lowered their indebtedness.

    The point is neither country can get out of debt without each other. They need each other to buy and sell across their debts, to establish steady reliable credit. Presently Moody's has lowered the credit rating of both countries, because there is no stable means of financing. They do not consider to help each other. They are trying to solve it within their perspective Countries. That will not work, because they can not establish an outside c...











    The President and US Bankers such as Tim Geither, and Ben Bernake must have a meeting in Europe to talk to EU leaders,and World Bank, & IMF Officials. to agree on EU buying all of US debt. Or at least an equal amount as the EU now has. Present Banks in the USA would be insured by The US Treasury, and Federal Reserve. The talks would be to make a Contract with the EU for them to Buy US debt, per the same amount as the EU has, and the USA would buy EU debt. The debt payment would become due in 10 years. Upon that time, the EU buys back it's debt from the USA, and the US buys back it's debt from the EU.

    Then according to my article follow the Economic Growth model for the Private Sector and implement Austerity Measures on both Governments. Upon the end of the 10 year cycle it is predicted that both nations will have lowered their indebtedness.

    The point is neither country can get out of debt without each other. They need each other to buy and sell across their debts, to establish steady reliable credit. Presently Moody's has lowered the credit rating of both countries, because there is no stable means of financing. They do not consider to help each other. They are trying to solve it within their perspective Countries. That will not work, because they can not establish an outside credit source. So both nations need each other to establish their both needed outside credit source.

    It is like Floating Credit, in a way, but not exactly because floating credit usually involves only one party. This involves two parties; Europe and the US, working jointly to establish credit stability in order to lower their debts.

    It will not work with a country who has less debt and the other country much more. Such as having Germany bailing out Spain, or Greece. And it does not work with the idea China which has a lower debt to buy out US debt, because one country has more to gain, than the other. If they are equally in trouble they need to cooperate to lift them from the peril.

    In fact, it would mean leaving China entirely out. This is good because it forces China inward, toward their own markets. And it may be politically smart, because with China focusing inward, it causes trouble between China Bosses, and essentially slows down China expansionism. Do we really want Communism to succeed? It only succeeds when it has access to outside markets, because Chinese do not have to compete with each other. When they compete with each other, they then look at each other as enemies. When this happens Communism is rejected, and the people see how fake they have been to themselves.

    Perhaps the Economic Crisis is a blessing, because it makes the outside Western Countries in the US and Europe work together in unity to lift themselves out of debt. This means higher trade and jobs with Europe and the US. Import and Export prices and goods can be easily exchanged in comparison to Asian goods in the West. Where as thinking Western goods coming to China will gain them profits is a delusion. Western Goods exported to China are always a loss, because Chinese can not match exchange rate performance, nor afford the higher product costs, that support US jobs.

    But Obama or Romney or whoever needs to act, instead of campaigning.

    For once I would like to see US Candidates do things that benefit Job creation, and use that work energy as their campaign. Match deeds with words, first, and let the campaign follow along. Money will pour in like opening the tap.
    (more)
  • TheR 2012/06/30 03:16:08
    TheR
    Note: Both the US and Europe would need to sign agreements that they will buy back their own debts when the time arrives. This will assure, neither nation will be held responsible for their original debts. If they do not honor the commitment European Assets would become US property, and a breakup of Europe would be realized. I am sure no one would agree to that. So they will honor the agreements.

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