Posted BY: RM | NwoReport
Governments in Germany, Austria, Sweden and elsewhere are trying to stuff chewing gum into the gaping holes of the sinking Titanic by bailing out energy companies, which can no longer cover their payments now that Russian oil and gas has stopped flowing.
Describing the situation is another “Minsky moment” in time, Credit Suisse repo expert Zoltan Pozsar explains the situation like this:
“Minsky moments are triggered by excessive financial leverage, and in the context of supply chains, leverage means excessive operation leverage: in Germany, $2 trillion of value added depends on $20 billion (worth) of gas from Russia.”
That ratio amounts to 100 times leverage, which is significantly greater than what we saw back in 2008 with the Lehman Brothers scandal and bankruptcy.
Germany is bailing out Uniper, one of its biggest utilities, while Austria is bailing out Wien Energie, its primary energy supplier. Finland’s Fortum is also looking for a taxpayer-funded handout. (Related: Europe’s upcoming food harvest is looking to be tragically lower than normal.)
Will the energy crisis be blamed for the coming financial collapse?
According to Austrian Chancellor Karl Nehammer, Wien Energie’s “loan” is part of an “extraordinary rescue measure” that aims to keep the company’s two million customers powered at least until next April.
“The goal was to help people quickly … It has now been agreed that all of these questions, which are rightly raised, must be answered promptly by Vienna (and) the energy supplier,” Nehammer told reporters.