Thursday, December 15, 2011

Q and A from Doc's Readers

 The Doc isn't here to play Q and A with, but our SD readers are more than capable of holding up their own.  Yesterday, the Fed (The Bernank) announced they had no plans to aid european banks.  In the comment section, ILUVPMS asks...

Let me ask all you people a question.. why would be in their best interest to help out europe... europe fails and falls apart nothing steps in the way of the dollar being the currency of choice... its all a game...

the debt that people are in is a system of slavery.... look at the greeks they are selling their gold for money!!! the same may happen here! 

AGXIIK offers a great response, almost Doc like....

AGXIIK said...
Failure of the EU community, defaults on bonds, credit lock ups, and economic failures will blow back on us like a typhoon We have $500 billion in Euro bonds in our banks plus a trillion or more of money in Europe as a result of our corporations storing cash over seas. The derivative markets and insurance made by the usual suspect like JPM would destroy them. The European banks would fail catastrophically and our banks would suffer 100% destruction of their capital bases.
Think we won't help Europe? Hell, we will fall all over ourselves to bail them out. Ben lied like a rug when he said he wouldn't start QE 3 What was operation Twist? QE 2 never stopped It morphed into QE3 and QE4 will be the Euro Bailout. Ben has lied so often and reflectively even he doesn't know when he is lying He continues to repeat the No More QE lie for so long he believes it himself
20% of our economy is in the Euro Zone. 20% of our S&P firms sales are in the Euro zone. 15% is directly in the PIGS, France and Germany. Their failure is our disaster with Depression levels of economic damage levels world wide.
Obama won't let it happen He wants to be relected. If Europe goes down the tubes not only will he not be reelected, he may not be able to serve out his term.
The disaster befalling us would destroy him and embed his legacy as the worst president and the one who could have 'helped' Europe when they needed him. He talked some trash the other day about Europe being 'wealthy' enough to manage their own problem We could build monuments to his consummate ignorance. But when the Fed yanks his chain and tells him to BAIL OUT EUROPE he will cry like a sissy while he pumps out the dollars.
He really hates Europe as the source of the colonial powers that supposedly enslaved his father's country but he loves the fact that Europe is already hobbled. He is enthralled by the European Socialist model of low expectations. He won't let their fail.
But and here is the big but, on the off chance that he decides to not help, you can be assured that China will. If Obama is so perverse that he would rather see Europe fail while presiding over the damage to this country, while seeking someone to blame, he might simply push off any tough decision, like the Afghan surge, jobs in America or the XL Pipeliine. China has a printing press too.
They can use our dollars and theirs to create a new reserve currency forcing Europe at the point of a financial gun to recognize the Yuan and other currencies baskets as the new reserve currency backing Europe.
They have been itching to demote the dollar to second class currency citizen This would be the ideal chance to smash our currency and us economically while giving them the leverage to control Europe's destiny
Beware Chinese bearing bailouts.
Beware Marxist Presidenta bearing ill will