Merkel hints at the real fear regarding Greek defaults

There has been a lot of talk about the coming Greek default and the likelihood of default of the rest of the PIIGS.  But when you look at the numbers involved you have to wonder what the big deal is.  Bernanke has printed up $1.6 trillion dollars from thin air over the last few years, tripling the monetary base of the US.  If the PIIGS default on $800 bn of debt, why can't someone -perhaps even Bernanke- print that up too?  After all, it's just funny money anyway, right?

Well, there is a lot of truth to that thinking and so perhaps there is a another deeper, underlying cause of fear which the Euro-heads are not talking about.

And so there is.

Warren Buffett called them weapons of mass financial destructions.  We are talking about the completely unregulated derivatives market - the largest insurance/gambling pit ever devised.  Nobody knows what this mass of globally intertwined contracts actually holds and that is the real reason for Euro-concern about the fall of Greece.  Angela Merkel recently said as much, "nobody around the globe knows exactly who holds those papers, who will have to pay how much."  More importantly, the article goes on to say, "those credit default swaps have a significantly higher face value than the debt itself".

And so in the final analysis, much of the to-do about Greek debt is really concern about the elitist-driven global Credit Default Swaps, derivitives and other highly leveraged Wimpy Promises that form the backbone of the global debt Ponzi.  Tiny Greece isn't the real problem.  The real problem is all the tens of trillions being bet on the lack of pay-ability of their debt and of the debt of all global sovereigns - the side bet if you will.  At the end of the day the concern is not as much about money that can be printed up from thin air as it is about loss of power and control that will come when sovereigns are brought down by their own economically corrupt system of debt and leverage and, yes, fractionally reserved morals and honesty.