If funds become scarce, politicians, especially in the Eurozone, are never at a loss for creative solutions to find new sources of capital and new credit mechanisms. This is exactly what we call the fiat world, materialized Keynesianism at its best (or worst for the citizens of the middle class).
The European Union, and the Eurozone in particular, is a child of this thinking that it is possible to turn political projects and ideologies into reality by manipulating interest rates, credit-financed government spending and creating liquidity out of thin air. However, reality, which can essentially be characterized by scarcity, can hit back hard when the illusion is exposed and scarcity reactions occur on the markets of real goods for the first time. We have seen this in recent months, when government bonds were sold off massively and the central banks were forced to intervene time and again.
Yesterday, the finance ministers of the Eurozone met once again in Ghent, Belgium, where the main focus was on pushing ahead with the euphemism of the year, the so-called capital markets union. Behind the usual facade topics such as harmonization of credit law or insolvency law, the main focus was on one thing: seeking and finding new sources of financing for the European Union's pet projects, climate change, the transformation of mobility and, above all, the war in Ukraine.
The the big surprise occured: One of the participants experienced a rare moment of honesty. The French Finance Minister Bruno LeMaire spoke openly about the fact that the European Union is essentially bankrupt and that it is time to move the 35 billion euros of useless cash of the citizens in the political sense. After we have already seen in the past week how attempts are secretly being made to introduce the so-called Eurobonds via war bonds, i.e. a joint liability that was originally ruled out, it is now a matter of materializing the supposedly useless cash of the citizens and using it for one's own purposes without any charm and without any buddy. If this had not happened within the framework of the European Union, as a freedom-loving person one would have to turn away in disgust from such machinations of such blatant disregard for civil liberties.
How this is to happen in detail remained unclear at first. It is of course possible that the rehypothecation process as we know it from banking practice will simply continue at European level and that a sovereign wealth fund will be set up as a European fund into which a part of the citizens' cash will automatically flow, which will of course then also earn interest with fiat money in order to conceal this secret theft and make it palatable for the citizens.
Be that as it may, the means to which the politicians of the Eurozone will now resort are martial and clearly directed against the civil liberties of citizens. It's time to pay close attention to political events and draw your own conclusions! The window of taking action is closing fast.
So it takes a bit of digging to understand this. If I've got it correctly, LeMaire is saying they will somehow take control of circa €10 trillion of money which is owned by individuals in their own bank accounts; and use that for investment across the Eurozone. Which is a tacit admission of the truth; even with QE, the Eurozone is effectively bankrupt, cannot meet its obligations, and is now looking to it's citizen's personal bank accounts to plug the gap. Presumably this will be sold with some kind of EU "guarantee" so it will be deemed to be low/no risk. Will it be optional? If true, this is basically the nationalisation of private wealth ... In other words, a form of communism.
You got that exactly right. The core of the whole thing will be to keep this money in the accounts as a pretense but at the same time to leverage it in other credit projects, which is what commercial banks do.
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