Is There Wealth Confiscation Coming to Greece? Plus a Wonderful Kyle Bass Interview

“I have directed Secretary Connally to suspend temporarily the convertibility of the American dollar except in amounts and conditions determined to be in the interest of monetary stability and in the best interests of the United States.… The effect of this action, in other words, will be to stabilize the dollar."

With these words, President Richard Nixon took a scalpel to the notion that the state can ever be trusted with a redeemable money supply.  While Americans had been thieved decades earlier under Franklin Roosevelt’s Executive Order 6102, Nixon’s hoodwink of the international community was one for the history books.  It was the final goal of Leviathan’s relentless pursuit of controlling all that is monetary.  The result has been the dollar’s loss of 82% in terms of purchase power with a federal bureaucracy sucking about $4 trillion every year from the private sector to boot.

It's hard to keep track of the volatility of idiocy coming from the Eurozone these days.  Each new announcement of a deal suppresses bond yields for a day or two till it all unravels when its revealed that the deal was a farce.  This goes back and forth as the entire region is working its way to either a separation or a complete fiscal and monetary union.  Supposedly, Germany has already begun working behind the scenes to draft a plan for a true one-country solution.  Via The Telegraph:

Angela Merkel, the German chancellor, is today expected to tell David Cameron that Britain does not need a referendum on EU treaty changes, despite demands from senior Conservatives for more powers to be repatriated to Britain.

The leaked memo, written by the German foreign office, discloses radical plans for an intrusive new European body that will be able to take over the economies of beleaguered eurozone countries.

It discloses that the EU’s largest economy is also preparing for other European countries, which are too large to be bailed out, to default on their debts — effectively going bankrupt. It will prompt fears that German plans to deal with the eurozone crisis involve an erosion of national sovereignty that could pave the way for a European “super state” with its own tax and spending plans set in Brussels.

To paraphrase the great Albert Jay Nock, whenever government intervention cause unforeseen consequences, the immediate response by those in the media and academia is to make the case for further intervention.  There is hardly a call for a more hands-off policy.  This wholly reactionary appeal for further centralization of power and control isn't surprising as it's the prime motivator for a state.  The great unwashed are incapable of ruling themselves so its up to the benevolence of elected leaders to guide them through life.  New York Times token conservative David Brooks made a startling revelation on the origins of the European Union in a recent article:

Then there was the elitism. Off the record, Europe’s technocrats would say the most blatantly condescending things: History had taught them that Europe’s peoples were not to be trusted and government should be run from the top by people like themselves.

With such a rich history of power grabs and exploitation, the citizens of Greece as well as the whole of the Eurozone should prepare themselves for what could be another wealth confiscation.  Inflationary policies that enrich the elite banker class at the expense of the lower and middle class are one thing as they cause Cantillion effects which distort the whole of the economy.  Direct thievery is another and it shouldn't be disregarded but prepared for.  In fact, the people of Greece appear to be preparing themselves already.  As I pointed out earlier, and emerging barter economy has already developed.  Via Mish, there is evidence of a movement to slowly withdraw funds from banks before a possible abandonment of the euro and reimposing of the drachma:

In the end, there is one simple question to ask.  Would you rather trust your money in your hands or the hands of the politicians and bankers who created the disaster to begin with?  The answer should be obvious.

I also want to point out a great BBC interview with Kyle Bass where he brilliant defends his use of credit default swaps and becoming rich by betting against the housing bubble.  Despite the hostile interviewer, Bass handles himself quite well and makes the moral and ethical case for hedging oneself against destructive government and central bank policies.  The interview is highly recommended and has plenty of quotable lines.

To end I will make mention of a blog post I did over at the Ludwig von Mises Institute of Canada titled "Jonathan Weil on the Insolvency of FRB."