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    GREEK D-DAY: SLOG US SOURCE CONFIRMS WALL ST PLANS AS SECRET BERLIN TIMETABLE EMERGES

    London Daily Telegraph piece cited as ‘on the money’

    February 19, 2012 · 2:53 am
    http://hat4uk.wordpress.com/2012/02/19/greek-d-day-slog-us-source-confirms-wall-st-plans-as-secret-berlin-timetable-emerges/

    Draghi bond-swap seen as ‘ECB protection’

    Further doubts about Merkel public position on default

    Just before midnight GMT Saturday, within hours of Bruno Waterfield’s piece about German finance ministry Greek default preparations appearing at the London Daily Telegraph site, The Slog received confirmation from a New York based banking source that – whatever German Chancellor Angela Merkel’s public stance may be – plans have been firmed up on both sides of the Atlantic for “an inevitable Greek default some time in the third week of March 2012″.

    There is only one source I trust more than this person: instrumental in enabling several Slog scoops during the Strauss-Kahn saga of last year, I have never been given a bum steer by the informant. Having been made aware of the Telegraph piece – in which the secret (and damning) Troika report on Greece’s chances is again quoted – this senior banker finally agreed to talk on condition of total anonymity.

    “The [Telegraph] piece cites Wall Street rumours about preparations for default, and so now the formal German work is coming out, US planning will be assumed pretty soon,” the source began, “They’re kind of preparations, but really they’re plans. And I’d say your chances of laying your hands on physical evidence are slim. No government-sourced papers exist as far as I know. There were only two maybe three meetings, and the attendees were barely in double figures. But the position was made brutally clear: for well over a month now, the Obama Administration’s conclusion has been a dead cert Greek default. The job of the President, the security services, the Reserve and the Treasury is to protect the United States from the consequences of that, and that’s just what they’ve been doing.”

    This is the second corroboration of the Slog’s initial source of the story about plans having been discussed – including dates – in Wall Street. The person – also extremely well-connected diplomatically – added:

    “Angela Merkel’s public position is a necessary illusion. The pressure from Frankfurt to get onto the task of preparing for default has been augmented by Washington’s sense of urgency. I wouldn’t call it close cooperation, but Schauble, Draghi and now Monti are fully aware of it. Mario Monti in particular has, I understand, welcomed it. The action being taken by the ECB [The EU Central Bank run by Draghi] yesterday is a big clue”.

    The banker is referring to Draghi’s decision to agree a preferable bond haircut ahead of the other bondholding parties. Several puzzled observers wondered why the Central Bank had openly protected itself in this way, as this subordinates the other private creditors, and thus will more than likely trigger a default.Yesterday the bank was suitably vague about confirming the move.

    “Draghi is protecting his butt, pure and simple,” the informant continued, “he gets the money out from under before the truth is fully grasped. And the IMF has done the same…its contribution now is peanuts. Lagarde has been told to save her money. Good advice in my view.”

    Yesterday morning, a regular Slog mole in Brussels pointed out to me that Italian bond rates had been rising again “and so it became necessary for Merkel and Monti to sound gung-ho about a deal. Frankly, the chances of getting a straight answer out of any of these beggars is close to zero. There is just far too much at stake. But I now very strongly doubt that a deal will be done Monday….and if it isn’t, then putting the steps in place for avoidance of default become well-nigh impossible”.

    This view is shared by Bruno Waterfield’s piece: an EU diplomatic source confirmed that “The private sector involvement takes at least four weeks to issue the prospectus and to get subscribers, and without a deal on Monday then time will run out in March”.

    “There will be no deal Sunday or Monday,” the New York source asserted, “Once the ECB is in shape, and now Draghi is happy with the key eurobanks’ viability, the Athens Government will be encouraged to declare itself bankrupt. I would have to assume most of the smart creditors have already sensed this. Nobody apart from a few Greek negotiators has paid them any real attention for days now. I guess the German preparations have surfaced because the EU now feels fairly safe.”

    The Schauble preparations – confirmed for the first time by Waterfield – become a semi-final piece in the jigsaw of subterfuge and obfuscation that has been in operation since mid January. Says the Telegraph piece:

    ‘The sense that an endgame is approaching has been fuelled by the secret “troika” report, by EU, IMF and ECB officials on Greek debt “sustainability”. It found that even if Greece implemented all the austerity measures expected of it, and if it achieves highly optimistic economic growth targets, it will still fall short of what is needed, with debt likely to total 129 per cent of GDP in 2020.’

    Although the Telegraph goes on to say ‘the European Central Bank and the European Commission are, for now, lining up with Mrs Merkel to push for the rescue attempt to continue, fearful that the financial tsunami that would be unleashed if it failed would swamp the eurozone’, my US source refutes this.

    “They have to say that,” the informant comments, “for now. There can’t be seen to be any forensics left for people to find. But the Washington view is very clear: they see Merkel as the key US ally, and neither they nor Frankfurt would let her take such a risk. Look, if the ECB is protecting its backside, Berlin has no choice but to follow suit. If she pushes through and gets a deal on Monday, then it really will be proof that everyone in the EU is insane – including her. I just don’t buy that.”

    At the height of the hysterical rhetoric between Brussels and Athens last week, Evangelo Venizelos declared, “there are forces in Europe trying to push Greece out of the euro.” It’s very probable there were rather more of them than he realised.

    • Any attack on Washington D.C. will result in all power shifting to Chicago. I highly doubt you’ll ever see both destroyed at the same time regardless of what weapon gets used but we must remember that the State of Illinois is far bigger than the City of Chicago and thus I guess both could be destroyed at the same time but still unlikely. Illinois is the one State in the U.S. able to take control of the Public Key Infrastructure if anything happens to Washington D.C.

      -=> The Unhived Mind

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