Today the man who 52 days ago remarkably predicted the collapse
of the euro against the Swiss franc just issued a second terrifying
prediction. This King World News interview takes a trip down the rabbit
hole of desperate central banks, massive losses and total global
collapse.
Eric King: “Egon, the ECB has just announced this 1.1 trillion euro package in a desperate attempt to fight off deflation.”
Greyerz: “These
decisions by the central banks have virtually no impact whatsoever on
the underlying economy over the longer-term. They did what they had to
do because the European banking system as well as the economy is in dire
straits.
Central
banks still believe that by printing money they can kick-start their
economies and save the financial system. That’s not the case. There is
no chance whatsoever to change the outcome of an indebted and bankrupt
European economy….
“Even
though this will have a short-term effect on markets, people need to
understand that this just creates even more debt that will never be
repaid. But the ECB is now pushing on a string because, sadly, printing
money is the only thing they know how to do.
As
it becomes clear that this new money printing program is also a failure,
the ECB will then accelerate the money printing. This will have the
effect of rapidly debasing the purchasing power of the euro and it will
also lead to even more chaos in Europe. It is of paramount importance
that investors protect themselves against this coming wealth
destruction.”
Disastrous Prediction Unfolds
Eric King: “Egon, with remarkable precision you predicted
what turned out to be a 58-sigma market-shocking move by the Swiss
National Bank. The former White House official, Dr. Philippa Malmgren, told King World News
that faith in central banks has now been shattered after massive losses
were incurred as a result of the Swiss National Bank going back on its
guarantee to keep the peg in place.”
Greyerz: “We
don’t yet know what the total losses amount to in the aftermath of the
Swiss National Bank’s historic decision but we know they are enormous.
The Swiss franc skyrocketed in seconds and the losses around the world
are staggering and have already been sufficient to bring down foreign
exchange houses and hedge funds. But the losses are impacting the
bigger banks and the central banks as well.
Swiss National Bank Still Has To Unwind Massive Losing Postions
As
an example, the Swiss National Bank has a position of roughly 500
billion Swiss francs, mainly in euros and dollars. The losses on those
currency positions were around 30 percent on the first day. So the
Swiss National Bank is now sitting on an unrealized loss of about 80
billion Swiss francs.
In
the coming months and years the SNB will have to reduce the size of its
balance sheet. So they will need to sell their euros and buy Swiss
francs. This is going to have the effect of further strengthening the
Swiss franc, which will put even more pressure on the Swiss economy. So
it’s a vicious circle for them.
Total Global Collapse
This
is what all central banks have done — they’ve trapped themselves in a
corner. They have zero or negative interest rates, they are printing
more money, and they are buying more assets that they can’t sell and
that are worth a lot less than they are paying for them. So every
single central bank in the world is bankrupt because they will never,
ever get the price for their assets that they paid for them. This is
why the financial system will not survive, Eric, and a total global
collapse is now in front of us.” ***ALSO JUST RELEASED: Paul Craig Roberts – The Whole World Is Staring Down The Barrel Of A Gun As Collapse Looms CLICK HERE.
