Cyprus—the Russian Angle

Cyprus—the Russian Angle

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One commentator gives an intriguing observation about Russo/German antics in Cyprus.

Sometimes a non-mainstream observer of the world scene comes up with real food for thought. Such was the case this week when British blogger Alexander Boot reflected on the actions of Russia and Germany in regard to the Cyprus situation.

Boot asks an obvious question, “The question is why the ecb and imf, which is to say Germany, made this raid a precondition for the bailout of Cyprus? After all, they were more lenient when bailing out Portugal, Ireland, Greece and Spain. Why single out Cyprus for rough treatment?” (March 19).

Attending to his own question, Boot retorts, “The answer is obvious: Cyprus is a floating refuge and laundromat for dirty Russian money.”

But he then goes on to address the larger strategic question of why Russia is so enmeshed with Cyprus: “But it’s more than just about exerting influence on Cypriot politics—potentially the Russians hope to gain the elusive prize they’ve been pursuing since the late 16th century: a foothold on the Mediterranean.”

Then Alexander Boot points to the numerous strategic deals concluded both in secret and, where convenient, in the public eye between Russia and Germany: “The 1922 Rapallo Treaty, the 1926 Treaty of Berlin, the 1939 Non-Aggression Pact and Treaty of Friendship all had their secret protocols that left the rest of the world none the wiser.”

Boot then makes an intriguing observation: “The German raid on Russian money in Cyprus (to call a spade a spade) is ostensibly perceived in Russia as a direct attack. Putin immediately described it as ‘unfair, unprofessional and dangerous,’ but one can almost see his eyes light up.

“For, unlike the previous German attack [World War ii], this one can conceivably turn Russia into a Mediterranean power. Gazprom, the world’s biggest producer of natural gas, has already offered to restructure Cyprus’s debt in exchange for exclusive exploration rights on the island. The Russians are also prepared to underwrite the whole bailout for the right to use a naval base on the island.”

So where are these latest Russo-German shenanigans over the Mediterranean leading?

Boot maintains that “It’s highly unlikely though that the Germans didn’t consider the Russian angle before launching their confiscatory raid. Yet they pressed ahead, which raises all sorts of possibilities.

Could it be that yet another deal between Germany and Russia has been struck? After all, historically the two countries have demonstrated their ability to conclude secret treaties whose ramifications become known only decades later. … [T]he propensity for underhand, backstage dealing in both the EU and Russia leaves much room for educated guesses” (emphasis added).

Five years ago, Trumpet editor in chief Gerald Flurry indicated that behind closed doors, Russia and Germany may well have already made a pact.

Whether that pact included a deal that would give Russia access to Mediterranean ports is unknown. Perhaps the ink is not yet dry on that score. Either way, as our editor in chief has declared, Germany, now holding the whip hand over the strategic island nation of Cyprus, will not yield its ground. But that does not discount a friendly, though temporary, deal between Russia and Germany over bailing out Cyprus banks in exchange for free, though again temporary, access to its port facilities. Such a deal would have to at least be seen to work in the short-term strategic interests of both nations. A tradeoff on access to energy resources could be the catalyst.

Keep watching Cyprus for the outcome of the grand game of control of Europe’s “soft underbelly,” as Winston Churchill called it, the highly strategic Mediterranean Sea.

Our booklet Germany and the Holy Roman Empire gives greater detail on the developing situation in the Mediterranean.

Coming: Inner-Core Europe—and War!

Coming: Inner-Core Europe—and War!

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A German think tank predicts the prospect of a prosperous inner-core Europe clashing with a poorer periphery.

In a harbinger of the prophesied inner core of 10 European entities to prevail in Europe under the sway of the Rome/Berlin axis (Revelation 17:12-13), a German think tank has highlighted the prospect of the European Union breaking up into a core Europe under German domination—versus the rest.

German-Foreign-Policy.com reports that the Friedrich-Ebert-Stiftung, a think tank associated with the main German opposition party (Social Democratic Party) has “developed four possible scenarios for the future development of the EU under the pressure of the euro crisis” (March 20; translation ours).

Of the four scenarios outlined in a recent report, the foundation believes that the most likely outcome of the current euro crisis will be “the formation of a smaller union around the German center (‘Kerneuropa’), while the EU continues parallel in the form of a sort of greater free trade zone” (ibid). Inevitably, that “free trade zone” would be subject to the diktat of the more powerful inner core, directed by Germany.

Of real concern is the foundation’s conclusion that such an outcome would bring with it “a dramatic impoverishment of EU peripheries as well as a possible total breakdown of the eurozone.”

This report by the Friedrich-Ebert-Stiftung goes on to observe that historically, the collapse of alliances such as the European Union has inevitably led to war. It points to the 1990s collapse of greater Yugoslavia as being a case in point: “The Ebert-Stiftung calls to remembrance that the decay of state-run unions can absolutely end in violence: One has to take this danger ‘seriously,’ it warned, with a specific reference to the former Yugoslavia” (ibid).

When one considers that it was Germany and the Vatican that lit the powder keg of the Balkan wars in a deliberate effort to break up that “state-run union” and deliver the Balkan Peninsula to the control of the Rome/Berlin axis, one surely has to consider a similar scenario as being a possible outcome of the European Union project—a German project under the spiritual influence of Rome from its beginning.

Read our booklet Germany’s Conquest of the Balkans for more detail on this subject and its final outcome.

EU Keeps Arms Embargo in Place Against Syrian Rebels

European Union leaders agreed on Friday that they will maintain their weapons embargo against Syria’s rebels. The decision came in spite of requests from Britain and France. Both countries have pressured the EU to lift its embargo so that they can send weapons to rebels fighting against Syrian President Bashar Assad.

In spite of the decision, British Prime Minister David Cameron said that his government has not ruled out its options for helping the opposition.

“Britain is a sovereign country, we have our own foreign security and defense policies. If we want to take individual actions we think that is in our national interest, of course we are free to do so.”

German Chancellor Angela Merkel warned Britain and France against operating outside of EU channels. She warned them to be “very careful” of going against Germany’s wishes.

Meanwhile, Russian Foreign Minister Sergey Lavrov warned last Wednesday that Moscow considers arming Syria’s rebels a breach of international law. Although Russia continues to support the Assad regime, that support has softened over recent months. Coupled with the fact that Berlin is keeping weapons out of the hands of Syrian rebels, this may indicate that Russia and Germany are reaching an agreement on Syria.

Bible prophecy predicts the end result of Syria’s ongoing war: a Syrian government that will distance itself from Iran and ally with Europe instead. As the Syrian conflict grinds on, pay special attention to German-Russian relations. For more information, read “Russia and Europe Moving Toward a Deal on Syria?” and “A Mysterious Prophecy.”

The Battle for Cyprus

The Battle for Cyprus

YIANNIS KOURTOGLOU/AFP/Getty Images

Cyprus is a pawn. The real struggle is taking place between Germany and Russia.

Germany’s systematic subjugation of the eurozone entered a critical new phase last Saturday with the creation of a bailout package for Cyprus. Although Germany’s radical demand for a levy on Cypriot bank accounts was rejected by Cyprus’s parliament last night, it was too late to prevent catastrophic damage.

To Cyprus, and even the EU.

Cyprus’s banks have yet to open. When they do, the chances of a major bank run are high. Meanwhile, when it comes to Cyprus’s desperately needed €10 billion bailout, negotiations are back to square one. In fact, future negotiations with the EU will be tougher now that Cyprus is showing itself to be intractable and uncompromising. Yet, even as the geopolitical stand-off continues, Cyprus is quickly moving toward financial collapse. The country needs €10 billion, and it needs it very, very soon.

This explains Germany’s uncompromising response to Cyprus’s rejection of the levy last night. Following the announcement, Berlin basically told Cyprus that it can kick and scream all it wants, but that will not change the fact that its fate lies in the hands of Germany and the EU. German Finance Minister Wolfgang Schäuble told Cyprus that the EU will not compromise with the bailout conditions, including the levy. He also reminded Cypriots, very publicly (on German television), that the destiny of their two largest banks sits in the EU’s hands. “The Cypriot state cannot fund itself on the markets. Its two largest banks are insolvent and are being kept afloat with emergency funding from the ecb, but only on the condition that there will be a long-term rescue program. If this condition is no longer met, Cyprus will no longer be solvent, and this is something Cypriot decision-makers must know,” he threatened.

In other words, Cyprus must submit to German demands or go bankrupt.

Cyprus is now scrambling to find a solution.

Enter Russia.

Russia has an enormous amount at stake in Cyprus. Strategically and geopolitically, the island is critical to its projection of power in the Middle East, most notably Syria. Most significantly, Cyprus is a banking and finance hub for Russian businessmen. Russian businessmen have 20-30 billion euros deposited in Cyprus’s banks, and do billions more in commerce each year.

Germany’s levy on Cypriot bank accounts did not go unnoticed by Putin and the oligarchs. When news of the levy broke over the weekend, President Vladimir Putin called it “unfair, unprofessional and dangerous.”

Earlier this week, I received an e-mail from a friend who lives in Cyprus. He reminded me of the “clandestine interests (even geopolitical), and possibly property, investments and monies” that Russia has in Cyprus. He felt this was an attack on Russia by Germany. He also reported an uptick in the arrival of private Russian jets into Cyprus since Saturday’s announcement.

Although the levy stands to hurt many Cypriots, the lion’s share of the money (€1-3 billion) would come from Russian businessmen. Meanwhile, Russia is already contributing to the bailout by agreeing to extend a 2011 €2.3 billion loan to Cyprus.

So, by telling the Cypriot government to take money from the oligarchs, Germany is effectively forcing an extra billion or two out of the Russians.

On Monday, as it became clear that the levy would be rejected and the EU bailout would fall into jeopardy, Cypriot Finance Minister Michailis Sarris was dispatched to Russia tasked with the job of securing financing. Last night, following parliament’s rejection of the levy one of the first calls made by President Nicos Anastasiades was to Vladimir Putin. Many view Russia as Cyprus’s last option. Right now we have no details about what a Russian bailout might entail. (One rumor swirling says that Gazprombank, the finance company associated with Russian energy giant Gazprom, is preparing to step in to save Cypriot banks in return for rights to Cyprus’s oil and gas fields.)

It is important to note that formulating a Russian bailout of Cyprus—an event that would significantly increase Moscow’s power over Cyprus—is not a minor or easy task. This reality is being widely overlooked by too many pundits. Russia and Germany are powerful countries, and lest we forget, historical competitors. Both possess enormous leverage. And both place a high value on Cyprus as a strategic asset. There is more at stake here than mere finances. Germany is not going to simply give in and let Russia take control of Cyprus.

It’s hard to know exactly how this will unfold. However, Bible prophecy and the history of the German-Russian relationship provide the parameters for analyzing the battle for Cyprus.

First, no one respects Russia and understands it strengths (and weaknesses) more than Germany. Otto Von Bismarck, Kaiser Wilhelm, Adolf Hitler and Konrad Adenauer each recognized Germany’s strategic vulnerability vis-à-vis Russia. These days Berlin must consider more than just its strategic vulnerability. Germany is heavily dependent on Russia for oil and natural gas. (There were rumors this week that Russia would shut down pipelines into Europe following the Cyprus levy.) Germany does not want to upset the Russians, at least not beyond a calculated point, and will likely be compelled to negotiate some sort of deal with the Kremlin.

Second, Russia respects and fears Germany equally as much, if not more. We are all aware of the history—though we too easily marginalize it—of Nazi Germany taking Eastern Europe and invading Russia. But Moscow also understands that Berlin leads the EU, a gigantic market of 500 million people, most of whom buy their energy from Russia. Germany has technology and capital that Russia needs to develop its oil and gas infrastructure. Germany also holds the keys to more than a few pieces of territory, mostly in the Balkans and Eastern Europe, dear to Russia’s heart. Russia knows it cannot make Germany and Europe an enemy.

The most important negotiations in regard to Cyprus will now take place between Germany and Russia, not Cyprus and Russia.

Right now, neither Germany nor Russia is in a position to seriously offend the other. Therefore, it is in the interest of each to strike some sort of deal over Cyprus.

But, as the negotiations continue, here’s one thing that will not happen: Germany will not relinquish Cyprus. As Trumpet editor in chief Gerald Flurry has explained, Cyprus is a critical strategic asset to Germany. Cyprus gives Germany a foothold in the Mediterranean, an outpost from which it can monitor Iran and radical Islam, and project power into the Middle East and North Africa. Last Saturday’s attempt to impose a levy on Cypriot banks was an attempt to secure greater control of the nation. Germany may eventually be forced to compromise on the levy, but it will not compromise on Cyprus being in the EU camp.

Perhaps Russia will persuade Berlin to compromise on the levy and cut Cyprus some slack. Perhaps Germany will come to some sort of arrangement that sees Russia financing even more of Cyprus’s debt. Germany may be forced to yield to Russia’s interests somewhere in Eastern Europe. It’s unlikely that Cyprus will be put in a position that will see it leaving the EU. If Cyprus does collapse and leave the euro and the EU, Berlin will undoubtedly put measures in place that will ensure it does not leave the orbit of Germany and Europe.

Whatever deal is struck in the battle for Cyprus, you can be sure Germany is not about to relinquish its small but imperative strategic asset.

How Germany Ambushed Cyprus

How Germany Ambushed Cyprus

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Cyprus’s harsh bailout was clearly the result of a thorough German plan.

In the early hours of Saturday morning, European Union officials decided to help themselves to the money in the bank accounts of the citizens of Cyprus. A tax of up to 10 percent on Cypriots’ savings would fund part of the nation’s bailout. This unprecedented step shocked the world.

What should shock the world even more is how Germany ambushed Cyprus and forced them to surrender to this tough bailout.

Here’s a rough outline of what went on Friday evening and Saturday morning, pieced together from reports by journalists based in Brussels:

Sometime on Friday, Cypriot President Nicos Anastasiades chatted with German Chancellor Angela Merkel on the sideline of an EU summit. The Financial Times’ Peter Spiegel says that according to Cypriot officials, Ms. Merkel reassured Anastasiades that the deal would not be too harsh. He says Mr. Anastasiades agreed to a deal that imposed a much smaller tax on savers. Those with under €100,000 (us$128,870) in the bank would be hit by a tax of 3.5 percent. Those with more than that would be taxed at 7 percent.

This conversation demonstrated that Cyprus wasn’t opposed to taking money out of its people’s bank accounts. The only objection Mr. Anastasiades raised was that he would prefer a higher tax on those with over €100,000 in order to reduce the amount that those with less in the bank had to pay.

Then Germany got tough. Later Friday evening, most EU leaders left, leaving their finance ministers to sort out the details of the bailout. With so much at stake, Mr. Anastasiades stayed behind.

Another report says that Anastasiades wasn’t even present for most of the meeting. Apparently, he wasn’t even on the same floor. The eurozone finance ministers simply worked out what they wanted and presented the Cypriot president with a fait accompli.

That evening, German Finance Minister Wolfgang Schäuble gave Mr. Anastasiades his condition for the bailout: Cyprus would have to take up to €7 billion from the bank accounts of its citizens. The Cypriot president was shocked. Ms. Merkel hadn’t mentioned anything on this scale. “The president said, ‘I can’t do that,’” one member of Cypriot delegation said, according to Spiegel. “You’re trying to destroy us. Even if I agree to it, I can’t pass it [through parliament].” Anastasiades stormed out of the meeting.

This is when the European Central Bank (ecb) stepped in. The ecb’s German board member and head of International and European Relations Jörg Asmussen approached Anastasiades with a simple message: Nice little banking system you’ve got there. It would be a shame if anything were to happen to it.

Asmussen gave the Cypriot president an ultimatum. The ecb is the only thing keeping Cyprus’s banks afloat right now. Cyprus’s central bank is entitled to borrow money at a very low rate from the ecb and then loan the money out to its banks. Asmussen said that if Cyprus did not submit to Germany’s demands, the ecb would cut off the money and the nation’s entire banking system would come crashing down. The government would face a bill of tens of billions of euros to clean up the mess—a bill it simply can’t afford. If it tried to pay it, the government would go bankrupt too.

Here are the mechanics of the threat, according to the Financial Times Michael Steen: The ecb’s board can stop the money if a majority votes to say that a bank is insolvent. The ecb said it would declare Cyprus’s main banks insolvent if the nation did not receive a bailout.

President Anastasiades had to make a humiliating retreat. He gave in, and Germany got its way: Cypriot savers would help fund the bailout.

Germany won. It reportedly had support from Finland, Slovakia and partial support from the Netherlands. But at the end of the day, it was a German operation.

Mr. Schäuble has tried to distance himself from the decision to tax those with less than €100,000. But his part in this is clear. His message to Cyprus was: Take about €6 billion from people’s bank accounts; I’ll leave you to sort out the details.

This was Germany’s push to take control of Cyprus’s financial system, through the bailout, without having to come up with all the cash themselves.

Remember, from the start, the euro was designed to fail in this way. A common currency without a common government is an unstable halfway point on the way to becoming a superstate. Ordinary Europeans did not want to become part of a superstate. So the EU elites set up the euro, knowing that for it to work, the EU must complete the journey. Europeans would be forced against their will into a political union.

It’s easy to sympathize with German taxpayers who are fed up with having to pay the debts of foreign countries. But this is what their leaders designed to happen. The euro was a vehicle to bring power to Germany. The irony is that the German people don’t want it.

Cyprus’s bailout could start getting messy. There is a good chance that the nation’s parliament will reject the bailout proposal. But as you watch the news, remember, the euro was a German set-up, and the Cyprus bailout was another German set-up. Cyprus is a vital island for any European nation that wants to project its power into the Middle East. Watch for Germany to gain control of it.

For more information, see Trumpet editor in chief Gerald Flurry’s recent video “Cyprus in Prophecy.”

Detroit Takes Emergency Measures

Detroit has become the largest city in U.S. history to be placed under the supervision of an emergency manager. Lawyer Kevyn Orr was appointed on Thursday by Michigan Gov. Rick Snyder. Governor Snyder told the media that the state is intervening in Detroit because the city’s finances have reached “a true crisis point.”

Orr is a bankruptcy lawyer who helped Chrysler, one of Detroit’s automakers, restructure its finances after it went bankrupt in 2009. In his new role, he has broad powers to control all city spending.

Detroit was once synonymous with wealth and prosperity. About a century ago, it boasted the fourth-largest population of any city in America. That figure has dropped from the millions to only 700,000—40 percent of whom live in poverty. Automakers and other manufacturers have left the city, along with jobs and citizens. Over the past decade, 25 percent of the city’s population has fled.

But Detroit’s crises have not just been economic. Its families have been obliterated: By some estimates, three out of every four Detroit families are missing a father or a mother. This social wreckage has contributed to an unbelievable state of affairs in the city. Nearly half of all Detroit adults are functionally illiterate. About one in three households have no one who has worked a job in the last 12 months. Gang activity and drug usage is out of control, and Detroit is widely regarded as America’s first major failed city. It is doubtful that its new emergency manager will be able to save it, financially or otherwise.

Detroit is an indication of what is ahead for cities across the country. American families are already disintegrating, and social structures are crumbling. The Bible prophesied that this would happen due to rampant sin. It also forecast that American cities will experience financial collapse, social upheaval, violence, riots and burning.

Detroit’s plight reveals that America has lost its blessings and is being overrun by curses because it has forgotten God. Read Leviticus 26 for a shockingly accurate prediction of America’s fate, and compare it to today’s headlines.