Let the buyers be warned!

If you trace the detail of the legal obligation of Germany, France and the other central banks behind the ECB, then you may find that in the event of the ECB being wound up then each of these national central banks will be finding grounds to repudiate their liabilities. "That's liability for another E500 billion transferred to European taxpayers..." Now that is an interesting assumption. But the situation is probably even more bizarre than that. In short, the ECB is issuing funds with no ultimate taxpayer backing. Take for example the German position should the ECB be wound up. They would claim that their Constitutional court, the Bundestag, and the Bundesbank had given no authorization for the issue of these ECB funds with plenty of advanced notice of this fact and therefore the German taxpayer was under no legal obligation to honor the liabilities of the ECB. In the case of Germany et al repudiating their responsibility for ECB liabilities then the loss will fall where it will. And that means that anyone selling assets of any form in exchange for Euros and still holding those Euros or outstanding debts in Euros will take the loss when the music stops playing for the ECB. The reality is that there is no final backer for the ECB and the Euros issued by the ECB. Therefore if a EMU area bank wants to buy your non-EMU area assets with freshly issued ECB Euros - think three times! Indeed this may be the deliberately fraudulent way to refinance EMU area banks before the final collapse of the Euro - get the ECB to print billions of Euros and distribute them to EMU area banks. Then get those EMU area banks to buy non-EMU area assets from unsuspecting mugs. When the ECB collapses then EMU area banks hold good assets and the foreign banks / investors hold the valueless Euros. Germany and France may see it as a bit of EMU area revenge for the toxic US housing assets sold to them - nevertheless it is naked fraud. What is the point of all this? "ECB's 489bn will 'buy valuable time' but is no eurozone debt bazooka" - The Telegraph. Now, how can there be any debt solution or "debt bazooka?" I must be missing something "magical" about to happen at Christmas. Is there no one left in politics with a "conscience?"

Surely some of them must be religious , standing in Church singing Carols ,then kneeling and praying ? Are they all "self serving", with no thought of regular folks and the consequences of their actions? You see things are getting beyond money - just the numbers don't add up, so when is it someone going to "pull the rug" from under the E.U.? Let the buyers be warned! Eurogroup Chairman Jean-Claude Juncker has proposed ten steps for solving the euro zone crisis including automatic sanctions for fiscally irresponsible governments, greater authority for the Commission and a dividend for taxpayers who rescue banks. REUTERS (source) - In an interview with German newspaper Handelsblatt published on Wednesday, Juncker also implied that a deeper debt reduction might be necessary for Greece. "If elements appear in the troika report which call into question the sustainability of Greece's debt burden, then we must discuss how we can guarantee Greek debt (with measures) beyond a participation of the private sector," Juncker said. Asked whether he had a plan to end the crisis, Juncker made ten suggestions: 1 - "(Release) the next tranche, if that's possible" 2 - "Ascertain the sustainability of Greek debt, otherwise we have to think about other steps that we can only take if we have given thought to all the consequences of those steps -- to those outside Europe as well." 3 - "Strict continuation of course of budget consolidation, with automatic sanctions for repeated failures to meet budgets 4 - "A road map toward bank recapitalization. The under-capitalized banks have to first try to get refinanced on markets. If that does not succeed, states have to consider whether they can jump in to make available the necessary capital." Tax payers should get dividends for rescuing banks. "We cannot simply hand them the money. We need to make sure that those who provide capital in whatever form are also represented in the decision making bodies -- in the supervisory board, the board of directors, in management -- and that we participate in the profits." 5 - Introduce a financial transaction tax 6 - "A growth program for so-called struggling countries." 7 - "A different tone in Europe on budgets. It is not acceptable that European Union countries are divided into those who give and those who take."

8 - "Stronger regulation of financial markets" 9 - "A new way to deal with ratings agencies." 10 - "We need an economic government. I'm delighted that the number of those supporting this idea has grown rapidly." The entire EU was a scam from the start. The entire reason for the common currency was to sell German and French goods to the countries they brought in to the EU. They did not demand that all the countries were equals, therefore the present problems were inevitable. Had they demanded that all of the countries had an equal ratio of manufacturing to GDP it would never have happened. But Germany and France only wanted customers not competitors. Another reason for the Euro was to facilitate the takeover of yhe energy sector by Russia. Germany and France can demand that companies within their countries that are using secondary manufactures from outside of the EU pull the contracts back and give them to Greece, Italy, Spain or Ireland, and continue this effort until all of them have and equal ratio of manufacturing to GDP. This will make all of the members of the federation equals and make the system work. It will also put a strict requirement on new members. Finally the bond market will see there is a rational and viable plan to work their way out of the problem and take the pressure off the markets. Source WSJ - As the euro-zone debt crisis intensified in recent months, at least two global banks took steps to install back-up technology systems that could handle trades in old European currencies like drachmas, escudos and lire. That, the banks quickly found, is not so easy in a financial world that is trying to both exhibit confidence in the ailing euro andjust in caseplan for its possible demise. Technology managers at the banks contacted Swift, the Belgium-based consortium that manages the network used in financial transactions, said people familiar with the matter. The banks wanted Swift's technology support and the currency codes that would be necessary to set up the backup systems. Swift declined to provide some information for such contingency planning, including whether old codes could be used in the system, said the people familiar with the matter. That is partly because officials there feared that releasing the information could fuel further doubts and instability in the euro zone, these people said. It is a relatively minor setback for banks, as they look at everything from loan agreements to the safety of their branch staff in the event of one country's withdrawal from the euro currency. But it illustrates the road blocks that politicians, banks and companies in Europe face as they attempt to simultaneously prepare for a euro-zone break up while assuaging market

fears. "As soon as you start contingency planningit can become a foregone conclusion," said Alastair Newton, senior political analyst at Nomura PLC. "But if things go wrong and you don't have plans in place, you're in trouble." Such planning comes as the idea of euro-zone break-up is still frowned upon in many corners. European Central Bank President Mario Draghi this past week said that such speculation about the euro's demise is "morbid." Nevertheless, governments, finance firms and corporations have been quietly stepping up plans in the past several weeks to prepare for a worst-case scenario. The Financial Services Authority, the U.K.'s bank watchdog, has sent letters to the country's major banks asking for updates on their level of preparedness, and a similar dialogue has begun between banks and regulators in the U.S. in recent weeks, said the people familiar with the matter. The U.K. Foreign Office has begun making contingency plans to evacuate U.K. residents from Spain and Portugal in the case of bank meltdowns in those countries, said a person familiar with the matter. In a sign of concern over stirring panic, a spokesman was tight-lipped about details apart to say that office is always preparing for all types of scenarios. In another sign of escalating fears, some corporate firms with operations in Greece and elsewhere in Southern Europe have begun transferring their cash out of Greece on almost a daily basiscompared to the normal two-week intervalas a precaution against a sudden loss in value if currencies are revived, said a banker familiar with the companies' transactions. Prepping their systems to handle codes for old European of currencies is one way banks are taking steps to buffer themselves against major business disruptions if any country suddenly leaves the euro zone. Currencies have three letter codessuch as USD for U.S. dollarsthat banks use in a wide range of financial transactions, from complex investment-banking trades to the basic transfer of money. The codes are set by the Geneva-based International Standards Organization, and used by Swift, which is a co-operative company that formats and sends payment orders for some 10,000 firms in more than 200 countries. One question banks have, and have not been able to clarify, is whether codes for now-defunct currencies, such as GRD for the Greek drachma, will be valid in the current Swift system. A Swift spokesman said the company is ready to take whatever actions are required to maintain normal operations, but that "it is not appropriate this time for Swift to comment on issues specifically associated with the euro zone." If a new currency emerges, it is handled by a maintenance agency affiliated with the International Standards Organization. A spokesman for that agency, SIX Interbank Clearing Ltd., said the agency has several projects looking at "dire scenarios" but the contingency plans for

such scenarios have so far remained confidential. Once a bank knows what the code is, it is relatively simple to set up a program for that new currency, according to technology experts. The bank must then tweak its infrastructure for expected volume and ensure data for counter-party banks are correct. Systems must then be modified and tested, said a technology executive at a bank in London, a process which takes one to two weeks.

Date: December 28.2011

Mircea Halaciuga, Esq. 0040724581078 Financial news - Eastern Europe