QUESTION: Mr. Armstrong; I watched the new documentary on your solution. I really want to thank you for everything you do and for free. It is so nice to see someone who actually gives back and has no personal agenda to enrich themselves. My question is this. You mentioned the reason why the United States economy was the envy of the world and differentiated it from Germany which has an export model economy that is why they supported the euro, to begin with. What do you see for Germany ahead?

Thank you

CB

ANSWER: Germany has an export-dependent economy which has directly benefited from the continent-wide trade liberalization and the creation of the Euro which eliminated foreign exchange fluctuations for German manufacturers in Europe at least. However, that simply means that Germany also has the most to lose from a worsening Euro crisis and a resulting wave of Euroscepticism. The political freedoms lost with the creation of the Euro will tear Europe apart. The refusal to consolidate the debt within Europe was profound. The Italy Crisis demonstrates what I have been warning about. BECAUSE there is no central debt, Brussels sticks its nose into every budget of every member state. The economic conditions within Europe are different between each member. Germany is an export economy and Greece is a tourist economy. There are great differences between each member so one policy does not fit all.

They are trying to PRETEND they are creating the United States of Europe but that is a joke. The refusal to have consolidated the debts created an unsustainable political union. The USA has a federal debt and budget. Washington does not stick its nose into the budgets of all 50 states. They issue their own debt which is NOT ACCEPTABLE for reserves of any bank. They are also all on their own paying different rates of interest according to their credit rating. In the EU, they are trying to manage the budgets of every member which will only lead to political differences. The structure is absurd and then the banks have to be politically correct and hold the debt of all member states. Thus, the risk becomes if one member is in a crisis, they bring down the entire system. In the USA, if Illinois goes bankrupt, it has no impact on the dollar, the national debt, or politics in Washington.

The greatest risk to Germany is the collapse of the Euro means that the single currency relieved their manufacturers of having to manage currency risk. Suddenly, the currency risk returns, the export model fails, and the lack of a domestic consumer market means that the economic conditions in Germany decline rapidly because of their dependence upon everyone else doing well.

The Spanish prosecutor wants to send the politicians of the Catalan independence movement to prison for 25 years. The prosecutor has demanded that the former Deputy Regional President Oriol Junqueras should effectively die in prison. The absurdity of what is going on in Spain reflects that there is no democracy still standing. Dictatorships always call treason anything which seeks to overturn their power. The Catalonia movement was NON-VIOLENT, it was Madrid that has been the violent aggressor.  The prosecutor charged them with rebellion. The Attorney General realizes this will reflect badly on Spain, so he is in favor of replacing the charge of rebellion with the less serious charges of sedition. The mere fact that they would seek criminal charges against political leaders in a non-violent movement that sought a democratic solution is a warning sign that to Spanish independence advocates for this removes any democratic resolution and signals that the only resolution will be another civil war in the future.

The last Spanish Civil War was Jul 17, 1936 – Apr 1, 1939. The beginning of the current movement really started to rise in 1999. We will see this rise as a direct reaction to these criminal charges. The next civil war is Spain may become much more obvious by 2022.