July 24, 2024

Gold Will Soar On Imminent U.S. Bailout of Europe

It is only a matter of time before the U.S. becomes deeply involved in the bailout of Europe.  Consider Geithner Takes Tougher Tone On Europe as reported by Bloomberg.

Treasury Secretary Timothy F. Geithner will urge European governments to step up their crisis- fighting efforts amid Obama administration concerns that the region’s woes may hurt the U.S. economy.

Geithner will press European Union finance ministers when he meets with them this week, a euro-area official said.“The U.S. has always been discretely preoccupied and discretely present, and now it’s starting to be intensely preoccupied and intensely present,” said Nicolas Veron, a senior fellow at Bruegel, a Brussels-based economics research group.

Geithner’s trip to Wroclaw will be his second to Europe in a week.The visit “underlines the nervousness of the administration in the U.S. about what’s happening in Europe” and the effect the region’s debt crisis is having on U.S. financial markets, Julian Jessop, chief global economist at Capital Economics Ltd. in London, said in an interview yesterday.

President Barack Obama told a group of Spanish-language journalists at the White House on Sept. 12 that “we’re deeply engaged with Europeans to try to solve this crisis.”

The European crisis was “very, very damaging in the American economy last summer,” Geithner told Bloomberg Television on Sept. 9.

“The way the U.S. handled the financial crisis and the lessons learned from that could become a much more important part of the IMF message to Europe,” said Eswar Prasad, a senior fellow at the Brookings Institution in Washington and a professor at Cornell University in Ithaca, New York.

Treasury’s Geithner is clearly laying the groundwork for a major role by the United States in bailing out the European Union.  The potential for a collapse of the European banking system is viewed as an unequivocal threat to the economic health of the United States by the U.S Treasury, the White House and the Federal Reserve.

U.S. participation in bailing out Europe will not be unilateral but rather in conjunction with the IMF and the European Central Bank.  The U.S. financial commitment, however, will be open ended.  The blueprint for saving the EU will be similar to that used by the U.S. during the financial meltdown of 2008 – virtually unlimited lending to prevent the sovereign default of insolvent European Union members.

The looming bailout of insolvent European nations, particularly Greece which is hopelessly bankrupt, will be the definitive signal that a return to sound finances has been utterly abandoned.  Rather than allowing market forces to correct the systemic imbalances in the financial system, the problem will be papered over by more debt, more printed money and massive debasement of paper currencies.

Gold, the enemy of central banks, will soar as governments frantically print and borrow to “save” Europe.


  1. Ewald Pankratz says

    Why this misinformation – there is no US bailout for Europe! In fact the US owned IMF/IWF tries to get into Europe.

    Forget it!

  2. Yet more $$ US taxpayers will be on the hook for

  3. Ewald Pankratz, ladies and gentlemen, CLUELESS!!!!
    The Fed has already given 16 trillion U.S. dollars to foreign central banks, ewald, if thats your real name.

  4. On the hook…we’ve been on the hook since WWII. It’s a good thing it’s all imaginary money for imaginary debts….too bad we had to pay real blood to
    bail them out the last time….come to think of it ,we’re paying real blood to keep them in oil from the Middle East.

  5. Well, if you had done a follow up on how this TG meetingpanned out, he was effectively laughed at and could leave early. Only so much respect you command when asking (or telling!) people to do something you clearly can’t do yourself at home. And to the idiot comments like “to keep them (the Europeans) in oil from the Middle East”…. ahem… check your figures, the US still uses what… 80% of the oil from teh ME?!?!?

  6. US are drowning already and these are just mocking moves to try keep flock of sheep in silence

Leave a Reply to dan Cancel reply