Re: Wall Observer BTC/USD - Bitcoin price movement tracking & discussion

is anyone paying attention to the macroeconomic picture? The Swiss National Bank shocked world markets by removing it's peg to the Euro, causing it's value to skyrocket. Two systemic Greek banks are using an emergency liquidity tool at the ECB to try and prevent a bank run. Oil Tanked and Gold spiked. This is 2008 all over again only worse this time.

How this will affect Bitcoin is anyone's guess, but I'm starting to think even my 2.5% margin long was way too premature.

Bank runs mean extreme DEFLATION of national currencies until the central banks ramp up the printing presses, start accepting used toilet paper as collateral and various other forms of counterfeiting.

Wealth is going to evaporate, credit is going to dry up and markets are going to crash with the exception of the safest government bonds (U.S., Swiss and maybe a few others).

I've warned many times for everyone to get their coins (and even fiat) off the exchanges if you aren't going to trade, but now I am saying it may soon be time to get your fiat out of the banks.

Potential bank run in the small Greek banks? So what.

What's the worst that can happen? The ECB step in and take over the banks' assets and loan books?

And besides, Greece is about 1% of the Euro (if even).

Greece is the canary in the coal mine. They are not having a liquidity crisis. They are having a solvency crisis. They owe an ass-load of money to Germany and if German banks are forced to write off those bad loans, it could very easily trigger a cascade as Portugal, Italy, and Ireland are in almost as bad shape. Just like when a margin call sets off a string of margin calls in bitcoin, these things can spiral out of control very fast.

Many many People, companies and national governments owe an extremely large amount of money that they can only make payments on by taking on new debt. If credit dries up, it presents a systemic risk that can only be halted by massive new liquidity injections from the central banks. But this only kicks the can down the road, as the crisis of 2008 was only postponed until this year. The only way to really fix it is to let it happen. We need a massive severe depression to transfer the malinvested capital to competent managers. But of course the banksters who run the world will not let that happen, so we'll get another round of QE counterfeiting to kick the can once again.

there are several other german divisions facing greece in this matters . if greece wants another bail-out then they might have to trade some of their gold reserves .

Greek gold reserves aren't even close to being enough. The only way out is for Greece to exit the EU and repay its debts in it's own massively devalued currency (Drachma?) But the damage will have been done anyway, as credit tightens, defaults pile up and the money multiplier runs in reverse. If your debtor can't repay you, then lending him even more money to make the payments only makes the loss that much greater when the delayed Day of Reckoning finally comes.

After the PIIGS, Spain and even France will follow, countries falling like dominoes. Nobody will believe Mario Draghi as he already admitted that when things get bad, you have to lie. Christine Gerard and Janet Yellen- well, they're women. They will be more concerned about who gets the blame that trying to prevent disaster. When Central Bank jawboning doesn't work, increasingly draconian measures will be taken. Withdrawal limits at first, and eventually capital controls.

The central banks will rev into high gear to save their fellow bankers and leave everybody else high and dry. They will massively expand their balance sheets, essentially creating money out of thin air. They will accept garbage as collateral for zero interest loans to big banks but we won't be able to get credit at any interest rate. Then it will finally be clear who runs the world and for whom they run it. (Hint: it ain't you)