June 17, 2008 (LPAC)--A new Morgan Stanley Report, promoted today in the Telegraph by Ambrose Evans Pritchard, "predicts" that growing economic and financial disparities inside the eurozone and the other EU-countries around it, will explode in the "Club Med" countries (eurozone) and the "euro-satellite" countries of Eastern Europe (non euro-zone, but subject to the ECB Maastricht dictate).
The report says, that while it is doubtful, that "Europe's monetary union will break up under pressure," corked pressures will have to "find release one way or another." This would most likely occur through property collapses and banking purges in the vulnerable countries of Southern Europe and Eastern Europe. "Tensions will not disappear into thin air. They will find fault lines on the periphery of Europe. Painful macro-adjustments are likely to take place. Pegs to the euro could be questioned." The report locates the biggest risks in "the arc of countries from the Baltics to the Black Sea, where credit growth has been roaring at 40-50% a year." Swedish, Austrian, Greek and Italian banks have provided much of the funding for the credit booms. Morgan Stanley predicts a "looming crunch in 2009, when a wave of maturities fall due".
The whole article is put in the framework of the current fight between ECB against Fed on interest rates and has the headline "Morgan Stanley warns of `catastrophic' event as ECB fights Fed." Morgan Stanley warns of "maximum stretch," if the ECB increases interest rates, due to the already volatile situation in Europe. It would become even worse, if the Fed backs away from expected tightening, leading to another `catastrophic' event.
Ambrose Evans Pritchard puts this all into the context of the 1992 destruction of the European Monetary System, which he calls "Europe's exchange rate crisis in 1992." He claims, that then as now, major "transatlantic tensions" between Europe and the Fed had built up. "The outcome of the 1992 deadlock was a major currency crisis and a recession in Europe". In reality, of course, it was the forces behind George Soros, who deliberately led the attack on the European Monetary Union (EMU) for his British masters, and broke it apart by his targeted speculative attacks on the British Pound and the Italian Lira, paving the way for the forced imposition of the Euro System, destroying the last vestiges of a certain kind of monetary stability in Europe.
This happened at that time with the help of synarchist-linked Bundesbank head Hans Tietmeyer, who played a key role in forcing through the Maastricht system and the Euro. After the reunification of Germany in 1989, the Bundesbank had steered a course of high interest rates, but then refused to agree to the necessary adjustment of the Deutschmark's value in the EMS-currency system. Instead, the band of variation for currencies was increased to 15%, instead of the previous 2.5%, which allowed speculators to intervene. The pound, which had become part of the peg to the other European currencies only in 1990, was weak. The Bundesbank intervened to help the Franc, but not the Lira and the Pound. Soros bet on the side of the Bundesbank, speculating on the demise of the Pound and Lira, while betting on the strength of the Franc. With all of this, Soros made about a $3 billion profit, which was then funneled into all sorts of dirty geopolitical operations of the Empire. The question should be asked: Is Soros preparing for similar operations now, to create chaos and target the emerging solution of American statesman Lyndon LaRouche's New Bretton Woods?
