Home

A federally-registered independent political party

Follow the CEC on Facebook Follow @cecaustralia on Twitter Follow the CEC on Google +


Follow the CEC on Soundcloud












Printer-friendly version

Citizens Electoral Council of Australia

Media Release  26th of August 2011

Craig Isherwood‚ National Secretary
PO Box 376‚ COBURG‚ VIC 3058
Phone: 03 9354 0544 Fax: 03 9354 0166
Email: cec@cecaust.com.au
Website: http://cec.cecaust.com.au
 

Banks fear collapse ‘within weeks’

European bankers are terrified that a financial shock will hit in September or October, according to The Telegraph in London.

Insurance costs on the debt of several of Europe’s biggest banks, including the Inter-Alpha Group’s Royal Bank of Scotland, skyrocketed to all-time highs on 24th August, even higher than during the September 2008 GFC.

Europe’s interbank lending market has frozen up as banks flat-out refuse to lend to each other—an exact echo of 2008—so the banks are parking their funds overnight in the European Central Bank (ECB) instead, 129 billion euros on Monday, three times the year’s average.

The Telegraph reported one senior London-based bank executive saying, “The problem is a shortage of liquidity–that is what is causing the problems with the banks. It feels exactly as it felt in 2008.”

A senior credit banker at a major European bank was quoted saying, “I think we are heading for a market shock in September or October that will match anything we have ever seen before.”

The only thing keeping up the present fiction that these banks are somehow still alive, is a tsunami of dollars, courtesy of U.S. President Barack Obama and the U.S. Federal Reserve—as Lyndon LaRouche has been reporting for weeks. On 23rd August, Bloomberg got around to admitting, that, although the Fed has officially wound down the bank bailout known as the Troubled Asset Relief Program (TARP), they are still bailing like mad, given that “[o]ne of the few exceptions was the central-bank liquidity swap lines that provide dollars to the ECB and other central banks so they can in turn auction off the dollars to banks in their own jurisdictions.”

Faced with this, the world’s stock markets hit new levels of insanity this week, with a rally that was attributed not to a turnaround in the crisis, but to the recognition that because the crisis was so dire, the U.S. Fed would have no choice but to resume overt money printing in the form of Quantitative Easing 3 (QE3) to bail out Europe’s banks, and provide a flood of new, hyperinflationary liquidity to cover over the problem … for now.

No alternative to Glass-Steagall

As Mr LaRouche called it at the time, the global financial system collapse began in July 2007, and the banking system blew out in September 2008; instead of re-enacting the Glass-Steagall law as Mr LaRouche had demanded, the subsequent bailouts brought the world to this even worse crisis today.

Forbes magazine contributing editor David Trainer belatedly wrote this week, “Repealing Glass-Steagall was one of the biggest mistakes ever made.”

Re-enacting Glass-Steagall, to again separate financial gamblers and their derivatives mess from the institutions that provide financial services to the real economy, is the only hope to fix the crisis—legislation to do so is before the U.S. Congress right now.

Citizens Electoral Council leader Craig Isherwood emphasised today that the near-collapse of Australia’s banks when the global crisis last hit these levels in September 2008, showed they were at just as much risk as those in the rest of the world, so all Australians should support the global campaign to demand Glass-Steagall too.

The CEC warned Australia’s political leaders of this crisis, for two decades. See our record on the matter, plus our solutions: Click here for a free copy of the feature DVD, the Homeowners & Bank Protection Bill—the Only Solution.
Click here to purchase a copy, $10.

To buy a copy of What Australia Must Do to Survive the Depression, click here.

Click here to join the CEC as a member.

Click here to refer others to receive regular email updates from the Citizens Electoral Council of Australia.



Citizens Electoral Council © 2016
Best viewed at 1024x768.
Please provide technical feedback to webadmin@cecaust.com.au
All electoral content is authorised by National Secretary, Craig Isherwood, 595 Sydney Rd, Coburg VIC 3058.