Neo-Nazis Now Third Most Popular Party in Greece

Neo-Nazis Now Third Most Popular Party in Greece

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It took just three years of economic collapse to revolutionize Greek politics.

The neo-Nazi Golden Dawn party is now the third most popular party in Greece, according to a survey by Pulse RC published in To Pontiki weekly September 6. Golden Dawn has the support of 10.5 percent of the population.

The New Democracy party is in first place, with support from 25 percent of those polled, followed by the radical left-wing Syriza. pasok, which used to be a major party, received the support of only 8 percent.

The poll shows a stunning change in Greek politics. In elections three years ago, pasok won with 44 percent of the vote. Golden Dawn received 0.29 percent.

Golden Dawn and its supporters have been implicated in brutal attacks on Greek immigrants, though the party insists it is not behind these attacks. Yet its popularity has continued to rise.

The situation in Greece is a shocking example of how quickly and radically a nation can change once its economy falls apart. Just three years ago, this level of support for Golden Dawn would have been unthinkable.

All immigrants in Greece are not innocent victims. One Greek reporter described an “escalating crime wave,” with “daily accounts in the Greek press of illegal immigrants robbing, raping and attacking Greeks.”

This is the kind of breakdown in society that happens when economies collapse. Crime increases, and the once trendy multiculturalism is swiftly rejected as many struggle against poverty.

Continue to watch Greece. As economies around the world fail, other nations will come under the same pressure. Greece is a preview of the political change that will soon sweep Europe.

Greece: Unemployment and Pessimism Surging

Greece’s unemployment rate eclipsed 24 percent in June, up 7 percent from a year ago. The official jobs data was published on Thursday.

The Greek Statistical Authority said the number of jobless people rose 34,000 and that more than 1.2 million Greeks are now out of work.

Greece’s coalition government is working to finalize a new austerity package for 2013 that will cut another €11.5 billion from the budget, including further reductions in benefits and pensions. The European Union has also said that it will not provide the bailout package unless Greeks work a six-day work week.

Longer work weeks and still further budget cuts are terrifying to many Greeks, who are already living in one of the world’s most tumultuous economies. But the Greek government must make life even harder for its people if it wants to receive funds from Germany and its other creditors.

Greece’s multiplying hardships are approaching a boiling point. Greece’s deteriorating economy will ultimately allow Europe to become even more centralized and more powerful. Read “Europe’s Crises Are Back!”, where columnist Brad Macdonald analyzes four upcoming events that could potentially transform the EU.

Australia’s Looming Debt Crisis

Australia’s Looming Debt Crisis

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When the debt bubble bursts, a lot of people will be wishing they were better prepared.

Is Australia’s national debt dangerous? Many say Australia has nothing to worry about. Debt levels are low, and tons of people want to lend us money. Australia should take advantage of this borrowing opportunity, they say.

The reality is that Australia’s debt levels are already dangerously high—and the nation may soon be in a worse boat than Spain and Greece.

At $245 billion, Australia’s national debt may not, at first, sound high. It works out to around 15 percent of gross domestic product.

But Australian debt totals aren’t like America’s. In America, the states have relatively low levels of debt compared to the federal government. But in Australia, states owe almost as much as the federal government.

Factor in Australian state debt and the total almost doubles.

Yet even that statistic doesn’t seem to worry many Aussies. Compared to many countries, it is true that Australia’s total state and federal debt is still on the lower end—but that also doesn’t matter.

Of more importance is who the debt is owed to, and whether it is getting easier or harder for Australia to service it.

Who is Australia’s debt owed to? Not to Australians. As analyst John Mauldin recently highlighted, an astounding80 percent of Australian government debt is now owed to foreigners. I don’t know if there is another developed nation of comparable or larger size with foreign ownership totals this high. Usually it is only smaller countries that rely on foreign lenders to such a high degree. The percentage of foreign ownership is escalating too! It was only 60 percent in 2006.

What this means is Australia’s recent budget deficits have been funded almost entirely by foreigners. Relying on foreigners to finance 100 percent of budget deficits is the epitome of financial folly. Not only does it open the door to geopolitical blackmail and coercion, but it is economically risky too. Much of this type of foreign “investment” is hot money—seeking the latest get-rich-quick-type deal. It is fickle and unreliable.

When that money disappears—and hot money always does—then Australia will be forced to pay for its overspending the traditionally painful way. It will either have to do without, or print money to pay its debts. If it prints, which is the politically easiest option, the strong Aussie dollar will go the way of the dodo.

And when foreign investment reverses, it can happen quickly. Ireland’s foreign ownership got as high as 85 percent before investors fled in 2009. It didn’t take long before they needed a bailout to avert bankruptcy. Italy and Spain are now battling for their lives against foreign capital flight too. Italy’s foreign ownership was slightly above 50 percent in 2008. It is down to 40 percent today. In 2009, roughly 60 percent of Spain’s debt was foreign owned. Last year it dropped to 40 percent, and now it is down to 26 percent.

When you rely on foreigners to fund unsustainable lifestyles, you are just asking for trouble.

And now Europe is paying the price. Eurozone countries do not have the ability to print money out of thin air to pay their debts, so while the value of the euro has remained fairly strong, their economies are taking the hit in the form decreased government spending and job losses.

In Australia, the specifics of the coming debt crisis may be slightly different, but the end result—a greatly reduced national standard of living—will be similar. Unlike individual European nations, Australia has control of its own money printing presses. It is likely that the value of the Australian dollar will be sacrificed in an attempt to pay its bills and control unemployment.

Australians should remember the lessons from Spain and Ireland. Both countries had low debt burdens before the banking crisis and economic slowdown struck. But then when foreign investors stopped funding their big banks, both nations had to backstop their banking system. Overnight, this turned Spain and Ireland into some of the most heavily debt-burdened nations. This then resulted in a national crisis as tax receipts failed and foreign investors refused to fund the Spanish and Irish governments. As we all know, eventually both nations required bailouts.

But who will bail out Australia?

When Australia’s economic bubble pops, perhaps pricked by a slowdown in China and the end of its mining boom, or the deflating of its national housing bubble, Australia’s banks will be in serious trouble. Since Australia’s four big banks control 80 to 90 percent of all financial transactions within the nation, if even one were to fail, it would be a systemic risk to the country. What this means is Australia’s banks—which have become just as reliant on foreign capital as the Australian government—are too big to fail, and the government is therefore on the hook for their debts as well.

Watch as Australia’s “low” debt burden suddenly balloons to unsustainable levels. And when the bubble pops, a lot of people will wish they were better prepared.

EU Investigates Gazprom

EU Investigates Gazprom

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Europe pushes back in the gas war.

The European Commission began a formal investigation into Russian energy giant Gazprom, it announced September 4. Russia supplies over a third of the European Union’s natural gas, with some countries relying completely on Gazprom.

The Russian government owns a 51 percent stake in the company and it often uses gas supplies to get what it wants from dependent nations.

The Commission will investigate whether Gazprom is holding back competition in gas markets in Central and Eastern Europe. It says Gazprom may be trying to stop its customers from finding alternative sources and burdening them with unfair prices. It could give Gazprom a fine of up to 10 percent of its global revenue, if it finds the company guilty.

The Commission ordered raids on Gazprom offices in 10 EU countries last year to gather evidence of anti-competitive practices.

The investigation is part of an on-and-off tussle with Russia over gas supplies that goes back years. Europe has made several attempts to lessen its dependence on Russian energy, fearful of Russia’s ability to use that dependence as a weapon. But Russia has thwarted these attempts by luring key European nations away from anti-Russian solidarity with lucrative energy deals.

Nonetheless, Europe appears to have quietly gained the upper hand—diversifying its gas supplies and tilting the balance of power in its favor. Credit Suisse forecasts that Gazprom’s exports to Europe in 2012 could be 18 percent lower than their peak in 2007.

Now Europe seem to be pressing home that advantage, with apparently perfect timing. As Stratfor, the Wall Street Journal and the Financial Times pointed out this week, Gazprom is also coming under increasing pressure within Russia.

Last year, Germany closed all its nuclear power plants made before 1981, and announced plans to phase out all nuclear power by 2022. This seemed to give Russia another energy advantage. But instead of building new gas power planets as expected, Germany seems set to replace the lost energy with coal. It’s even persuaded the Green Party to support coal power—the most highly polluting form of electricity generation.

After a few quiet years, the gas war between Russia and Europe could be back on. But this time Europe has changed tactics. Russia has successfully blocked Europe from building pipelines to Central Asian countries outside of Russian control. Now Europe is using alternative sources such as shale gas, and alternative transport methods such as liquefied natural gas—which doesn’t need to run in pipelines—to fight back.

Calling Gazprom out on its anti-competitive practices while it is facing some financial and political trouble at home looks like the latest push in this battle over vital resources.

Keep an eye on this fight. Competition with Russia will play a key role in forcing European nations to unite.

Germany Selling Submarines to Egypt

Germany Selling Submarines to Egypt

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Germany continues to use arms exports to try to build a Middle Eastern alliance.

Germany has agreed to sell two submarines to Egypt, Egyptian newspaper Al-Ahram reported August 31. The German government has refused to confirm or deny the sale.

Al-Ahram quoted the commander in chief of the Egyptian Navy, Osama al-Gindi, as saying: “We have agreed to a deal with Germany to procure two submarines of the latest 209 Class.”

Israeli newspapers report that the Israeli government is not happy about the sale, and that relations with Germany are now strained. “We have been observing for a considerable time that the Egyptian Army is arming itself—but against which enemy?” said former Israeli ambassador to Germany Shimon Stein. “Libya and Sudan are certainly no threat.”

An unnamed German government source told the Financial Times Deutschland that the six submarines Germany sold to Israel are far more advanced than the ones to be sold to Egypt. “We would never do anything which would endanger Israel’s security,” the source said.

Kieler Nachrichten, a German paper printed in Kiel, said that Germany would deliver the submarines in 2016.

Germany’s quiet Middle East policy is to build an alliance to confront Iran, primarily using arms sales. It’s already involved in deals with Saudi Arabia and Qatar. This arms sale is a German attempt to bring Egypt into its anti-Iranian alliance.

Germany’s efforts will fail—the Trumpet has forecast for years that Iran will ally with Egypt.

But the sale is another example of Germany using its arms industry to try to build up a Middle Eastern alliance. Watch for such efforts to continue.

For more information on this coming alliance, read Trumpet editor in chief Gerald Flurry’s article “How the Syrian Crisis Will End.”

Europe’s Crises Are Back!

Europe’s Crises Are Back!

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September 2012 could be the month Europe changes forever.

After an August spent frolicking on the warm beaches of Greece and Spain and sipping chardonnay on the sunlit steppes of southern France and northern Italy, Europeans have now returned to work—and to a month that promises to be the antithesis of relaxing and stress-free.

For Europe, and the rest of the world, September will likely be marked by extreme stress, severe financial convulsion, and intense political debate and bickering. The next few weeks will be tumultuous and transformative, and will quite likely determine the fate of Europe.

So, as September kicks off, here are four major events you need to pay close attention to.

1) German Constitutional Court Ruling

On September 12, Germany’s Constitutional Court will rule on the legality of Germany’s participation in the European Stability Mechanism (esm). Established in the wake of the 2008 debt crisis, the esm was designed to collect funds from eurozone states and then disperse money to struggling states. Although it collects money from numerous European states, the esm is worthless without Germany’s checkbook.

Most analysts expect the German high court to approve of Berlin continuing to contribute to the esm. Many, however, expect the court to impose strict conditions on Germany’s participation. “The German Constitutional Court sees itself as the guardian of a certain idea of Germany—small, stability-minded, and inwardly oriented—and court watchers expect a ‘yes, but …’ ruling that stipulates that the red lines of German democracy have been reached,” explained Tyson Barker in Foreign Policy last week.

Whatever the specific conditions imposed by the court, they will undoubtedly compel the German government to protect and further Germany’s national interests, and to extract concessions from eurozone states that the Berlin-led esm might be forced to rescue. A “yes, but” decision from the court will elicit two general responses from Europe. First and most unlikely, ailing European states could flatly reject German/esm assistance on account of its imposition on national sovereignty. This would be a decision that effectively amounts to national financial suicide.

Second, and more likely, eurozone states could simply capitulate to Berlin’s demands and sign away sovereignty in return for sorely needed cash.

Either way, a “yes, but” decision by Germany’s Constitutional Court will augment Germany’s position at the center of Europe’s debt crisis.

If Germany’s Constitutional Court says no to Germany’s participation in the esm—a decision Moody’s says is 40 percent likely—it would gut Europe’s current bailout infrastructure. A negative ruling, reported Reuters, “would cast the 17-nation European single currency area into turmoil, spurring panic on bond markets,” and quite likely precipitate a major political and financial catastrophe.

2) Dutch Elections

On September 12, at exactly the same time that Germany’s Constitutional Court is making its pivotal ruling, the Dutch will be electing a new government. This too, could prove hugely important for Europe’s future, and especially the German-led axis of northern European states that has dictated the management of the eurozone crisis.

As Barker notes, the Netherlands “is one of the small economic powerhouses that has aligned itself with Germany—[it’s] tough-minded but traditionally somewhat pro-European.” Since Europe’s debt crisis began, the Netherlands, together with Finland and other northern European states, has solidly supported the German solution of demanding more austerity. That is, until recently.

Over the past few months, the Dutch have grown increasingly disconcerted and frustrated with Berlin’s approach to the eurozone crisis. Many don’t like the imposition of austerity measures. The economic picture for the Netherlands is darkening; its economy shrunk by 1.5 percent in the first six months of 2012 and unemployment is rising. The economic malaise, which is mild compared to that of Greece or Spain, has boosted the popularity of some of Holland’s anti-Europe political parties ahead of next week’s election.

In particular, watch the Socialist Party, led by Emile Roemer. As Barker notes: “The far-left Socialist Party (SP), which is currently leading in the polls, says it would flout EU budgetary rules, call for a referendum on the recently signed EU fiscal pact, oppose rescue packages for Greece, and roll back the ‘Berlin consensus’ economic policy built on hard money, tight fiscal controls, and structural reform.”

In all likelihood, the electoral success of the Socialist Party (and other marginal parties, such as Geert Wilders’s Freedom Party) will necessitate the cobbling together of some sort of coalition government. Whatever new government forms, it is likely to have a formidable Euroskeptic contingent. Such a contingent will make it more difficult for Amsterdam to quickly and simply endorse Germany’s approach to the eurozone crisis.

If the Netherlands diminishes its support of German leadership, and possibly leads the way in a northern revolt against German stewardship, the pressure on Berlin will quickly intensify. The growing Euroskepticism among northern European states means Germany’s window of opportunity to solve this crisis by integrating further is fast closing.

3) Spanish Bailout

On September 14, two days after the Dutch elections and German court ruling, eurozone finance ministers will meet to discuss Europe’s outlook, and specifically that of Spain. “Following the meeting, Spain could well become the fourth country in the eurozone to seek assistance from its neighbors,” reported the Wall Street Journal yesterday.

The situation doesn’t look hopeful. Writing in the New York Times Monday, Landon Thomas Jr. noted that growing numbers of Spaniards are cashing out and fleeing the country ahead what they believe is an inevitable crisis (emphasis added):

In July, Spaniards withdrew a record €75 billion, or $94 billion, from their banks—an amount equal to 7 percent of the country’s overall economic output—as doubts grew about the durability of Spain’s financial system. … According to official statistics, 30,000 Spaniards registered to work in Britain in the last year, and analysts say that this figure would be many multiples higher if workers without documents were counted. That is a 25 percent increase from a year earlier.

Spain is hemorrhaging money. Investors, banks and the general public are pulling their cash out of Spain. At this rate, the equivalent of the entire annual output of Spain’s economy is leaving the country every six months.

That’s unsustainable. “Our economics team believes that Spain will not be able to avoid a full-blown bailout,” wrote financial services conglomerate Nomura in a research note.

With that kind of money leaving the country, Spain’s currency would be collapsing if it were outside the euro, the Nomura note points out. Of course, if it were outside the euro, it might not be in this situation.

Compounding Spain’s problems, its regions are also struggling. Spain has set aside €18 billion to bail them out, but it’s becoming more obvious all the time that it will not be enough.

Spain is due to pay around €20 billion by the end of October. It’s running out of time to come up with that money. The nation is teetering on the brink of needing a bailout. It will probably be pushed over the edge in September.

Spain’s economy is five times larger than Greece’s. Bailing out Greece strained Europe. Bailing out Spain promises to force some even more radical changes.

4) Grexit

On September 12, or sometime soon after, the European Central Bank (ecb), the European Commission and the International Monetary Fund (imf) will release their combined assessment of how well Greece is doing at keeping its promises to impose austerity. The report comes ahead of the decision by Germany and others of whether to give Greece more bailout cash.

If the report is positive, which everyone knows is highly unlikely, Athens will be given more bailout money. If the report is negative, and says that Greece has failed to live up to its commitments—which many believe is certain and inevitable—then Germany and its allies will have to decide if they’re willing to continue funneling money to Athens. Chances are, Berlin will say no.

If that happens, the much-talked about Grexit—Greece’s exit from the eurozone—is likely to happen.

The New York Times recently reported that big American banks and consultancy groups have been “doing a brisk business advising their corporate clients on how to prepare for a splintering of the eurozone.”

“That is a striking contrast to the assurances from European politicians that the crisis is manageable and that the currency union can be held together,” it writes. Corporate Executive Board, a private advisory company, reports that four out of five of clients polled expect Greece to leave the euro.

The banks are putting together contingency plans like driving truck or train loads of money into Greece to pay employees as the financial system falls apart.

As these events unfold, they’re likely to be so dramatic and significant they will even make headlines in the mainstream media, perhaps even in America. As the headlines in the mainstream news mount, though, don’t be distracted away from theTrumpet.com. Share this website with your family and friends, with your acquaintances and workmates. Follow us on Twitter, on Facebook. Subscribe to our print magazine.

When it comes to Europe, no other news organization, media outlet or religious organization has a legacy like ours of explaining and forecasting events in this critical, prophetically significant region. For more than 70 years now, the Trumpet and its predecessor have been accurately and consistentlywatching and prophesying about events in Europe—events that are now coming to fruition. After decades of working faithfully and tirelessly, you can be sure we’re not about to stop now.