So, it has ultimately occurred, Greece has shut down its banks and enforced capital controls. And so the dominoes start to fall. This is only the first action in a grand opera that will proceed to unfold in the coming months. To try to guess what is on hand for the European Union, it is good to take a glimpse at how the fall of the Soviet Union took place. The fall of the Soviet Union started with a widespread sense of dissatisfaction with the government among both the working class and the elites. This gave birth to strikes and demonstrations in Poland that led to the fall of the Polish government in June of 1989. In November of that year the Berlin wall came down. Then, running into 1990, the communist governments of Czechoslovakia,
Romania, Bulgaria and Hungary fell. Ultimately, in December of 1991 Michael Gorbachev quit and the Soviet Union itself hit bottom.
So now that Greece has hit a brick wall we can expect Spain, Italy, France, Germany and ultimately the United States itself to follow a nearly identical flight to what we saw with the Soviet Union.
What most people still do not understand about the fall of the Soviet Union was that it was not triggered by failed ideology but by real financial bankruptcy. That is why the United States and the European Union, which is modelled almost precisely on the Soviet Union, are doomed to encounter regime change. They are bankrupt.
Chinese and BRICS government sources clarify what they are going to do next. Chinese number 2 Li Keqiang is to arrive in Europe this week.
After saying they would never consider capital on Sunday morning, the Greek govt instituted them that night, closing banks for a week. It appears certain that they will default on Tuesday’s payment before Thursday referendum on what to do about the debt. As markets plunged in reaction, Puerto Rico announced it could not mathematically repay their debt.