Gold price rises after German court rules it can plunder taxpayers through the ESM
So finally we get a decision about whether the latest (but surely not the last) new-fangled bailout scheme, the ESM (European Stability Mechanism), is legal in Germany.
The rather unsurprising ruling is that it is in fact legal for the German government to take german taxpayer money and bailout the other bankrupt European countries, as long as it doesn’t exceed €190bn. This despite it being quite clear that it is in fact against the letter of the law which states:
Treaty on the Functioning of the European Union (TFEU)
Article 123 (ex Article 101 TEC)
1. Overdraft facilities or any other type of credit facility with the European Central Bank or with the central banks of the Member States (hereinafter referred to as ‘national central banks’) in favor of Union institutions, bodies, offices or agencies, central governments, regional, local or other public authorities, other bodies governed by public law, or public undertakings of Member States shall be prohibited, as shall the purchase directly from them by the European Central Bank or national central banks of debt instruments.
That’s pretty clear isn’t it? It certainly doesn’t say that you can bailout a country as long as it is ‘no more than €190bn’. But we really should be use to this by now, there really aren’t any rules or laws anymore, they get made up and changed as we go along to suit the powers that be and to always ‘stick it’ to the little guy.
Oh, and because we live in the world where the goalposts and rules get changed on an almost daily basis that €190bn ‘limit’ is only ‘fixed’ until it isn’t, and then the ‘limit’ will simply be moved up as and when required.
The ESM is basically another political slush fund, based out of Luxembourg, for tax purposes of course, where members of the Eurozone pay in a set amount to bailout those who scream loudest.
But once again some of the biggest contributors to the fund are countries that are basically insolvent themselves:
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That’s right the 3rd and 4th biggest contributors are meant to be Italy and Spain, you know those two countries that are on the verge of calling for a bailout themselves, and Greece is there at number 7, Greece!
So will it work? It depends on who you are and what you mean by ‘work’, if you’re a connected member of the ‘club’ (like the big European banks) it will work like a charm as more transfer payments and wealth redistribution is piled into your pocket. But if your an average Joe paying your taxes you just got screwed again, and it certainly wont ‘work’ in the sense that it will fix all that ails Europe.
After all how on earth can it, the problem in Europe is far, far too much debt, and the ESM just guaranteed that those debt burdens will rise – where else will the capital come from to pay into the fund but from the issuance of more debt. And in a crazy world where money is debt and debt is money it’s little wonder the gold price popped higher on the news.
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Now all it will take is for Ben Bernanke to come out tomorrow and announce some new form of money printing and gold will be set for its 4th up week in a row.
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Link to this article: : http://www.goldmadesimplenews.com/gold/gold-price-rises-after-german-court-rules-it-can-plunder-taxpayers-through-the-esm-7866/