SPECIAL REPORT – Epikaira Reveals American Plan To Replace Euro With Dollar

With the Eurozone in a frenzy and ready to fall apart, the future for Greece as well as other countries in the south are anything but rosy. In comes a “revolutionary” proposal from the US on how Greece and other European countries could return to economic stability. According to Epikaira magazine, if countries were to exit the Eurozone and adopt the US Dollar as its currency then this would give the Americans the leap they need in order to further penetrate into Europe.

This ambitious plan which took the news world by
storm says that the US Federal Reserve (FED) has put together a report (74,000 words), which looks at the replacement of the euro with the dollar as a national currency to the member states that do not want to continue in the Eurozone.

According to the study, if Greece decided to exit the Eurozone, and in the framework of not allowing total chaos to brake as a result of this (limited imports, etc,), a “pegging” plan will be enforced right away with the “new drachma” and the US dollar.

The plan, says the article in Epikaira, will obligate Greece to adopt the US dollar as its de facto national currency for a period of five years, while the “new drachma” will begin circulating but will only be used as a pegging on Swap agreements between Greece and the US, with an initial rate of 30 to 1 .

The article says that the first effect of such a transition (from the euro to the dollar) will be a significant depreciation of the euro of up to 50%, particularly if many more member states decide to exit the eurozone as well. When this happens then this will reduce the dollar value of outstanding euro Greek debt, adds the article.

Epikaira also said that if the forecasts of the euro’s depreciation materialize then the Greek debt will also be reduced drastically, without receiving a further “haircut” and without even creating a major credit event.

Thirdly, the FED will provide financial support to Greece, with low interest rate loans.

Fourth, the Bank of Greece will begin printing the “new drachma”, which as mentioned earlier will be used for Swap agreements and exchanges. Also in the 5-year transition period the FED will cover the lending needs of the country as well as its budget deficits with funds that will become Swaps with the “new drachma”.

Finally, at the end of the five year period, the “new drachma” will be ready to circulate on the market.

The proposal is not that far-fetched

Several days ago a similar proposal was published on a blog by Georgios Gialtouridis. In an article entitled a proposal for Greece to return to economic stability he talks about the very same thing… with even more details.

Greece’s public debt is in euros. It is currently estimated at 360 billion euros. In US Dollar terms that’s approximately $480 billion. If Greece exits the Eurozone it will bring the entire currency union to the brink of collapse as many European officials have admitted.
Greece immediately exits the Eurozone and adopts the US Dollar as its de facto currency for a five-year transition period. The value of the euro may collapse vis-a-vis the US Dollar from the current US$1.35/euro to a possible US$0.80/euro, a roughly 40% decline in the euro’s value. Such a euro collapse is entirely possible if Greece abruptly exits the Eurozone and is followed by talk of other Eurozone countries following suit as investors will flee to the US dollar as a safe haven currency. Due to the devalued euro the Greek debt will then calculate to roughly $290 billion in US dollar terms, or a 40% debt reduction in dollar terms. Remember, at its introduction in 1999, the euro was traded at US$1.18/euro but by October 26, 2000 it had fallen to an all-time low of US$0.8228/euro. Also, this is not like the ‘haircut’ on Greek sovereign bonds proposed last month which would result in a 100 billion euro debt reduction, at most, with the added risk of a credit event if voluntary private sector involvement (PSI) is not solidly in place.
The US Federal Reserve can help Greece meet its financial obligations during the five year transition period by lending to the Bank of Greece at favorably low interest rates. The US Federal Reserve is a privately-held institution and it has lent funds to foreign central banks in the past via temporary reciprocal currency arrangements or swap arrangements:
Because of the global nature of bank funding markets, the Federal Reserve has at times coordinated with other central banks to provide liquidity. These Dollar Liquidity Swap Lines have been authorized by the Federal Reserve with various central banks, including the European Central Bank, the Bank of Canada, the Bank of England, the Bank of Japan and the Swiss National Bank to name a few, in order to provide liquidity in U.S. dollars to overseas markets.
The Federal Reserve operates these swap lines under the authority of section 14 of the Federal Reserve Act and in compliance with authorizations, policies, and procedures established by the Federal Open Market Committee (FOMC).
The Bank of Greece will authorize an initial money supply in New Drachmas in order to exchange or swap for US dollars with the Federal Reserve thus activating such a Dollar Liquidity Swap Line. The New Greek Drachma will be pegged to the US Dollar at an initial exchange rate of 30 GRD/1 USD. The New GRD will not circulate during the five-year transition period to prevent currency fluctuation and to alleviate inflationary pressures. The GRD money supply authorized by the Bank of Greece during the five-year transition period will be used strictly for swaps with the Federal Reserve. All euros in Greece’s banking system and its economy in general will be immediately converted to US dollars. For the next five years any shortfalls in Greece’s fiscal budget will be covered by the Federal Reserve funds swapped for the New GRD. After the five-year transition period Greece will introduce the New GRD as its official currency as it will be allowed to float.
Due to the nature of the Dollar Liquidity Swap Line, it would need to be rolled-over on a semi-annual or annual basis, much like some bank credit lines. At the conclusion of each transaction term the Bank of Greece will pay interest, at a predetermined rate, to the Federal Reserve.
This plan will boost American investment in Greece, including investments from Greek-Americans who will proudly participate. A trade treaty between Greece and the US can be signed eliminating all import tariffs between the two countries thus boosting Greek exports to the US. American tourism to Greece will also be boosted as the currency in both countries will be the same for the next five years. Greek destinations can be packaged by US tour operators emphasizing on the temporary elimination of the need of currency conversion.
Greece will buy military hardware solely from the US as part of the new arrangement. Drilling for gas and oil in Greece’s Exclusive Economic Zone can be contracted to US companies. Bank deposits will return to Greek banks as threats of a default will be diminished.
Greece’s debt interest costs will be reduced considerably. An aggressive Greek debt buyback program in the secondary market at the current discounts can further reduce Greece’s debt obligations. Sound fiscal management should result in a primary budget surplus. Greece will gradually reduce the liquidity swaps with the Federal Reserve until it starts issuing sovereign bonds in the open market at interest rates favorable to Greece.
This plan will install confidence in the new Greek economy and we will immediately see the light at the end of the tunnel.

 Full political dependence

The study, notes Epikaira magazine, only naturally “sees” benefits for Greece. It says this will make Greece more credible on the financial markets, it will attract handsome US investments and more tourists and at the same time strengthen diplomatic support from the US in a series of “hot” issues such as Greece’s Exclusive Economic Zone (EEZ). -natural gas, oil-

Nonetheless, if this latest “test” comes to pass, then the political dependence of Greece from the US will be ten-fold. We will be in debt up to our ears on every front.

On the other, the policy promoted by Angela Merkel, is only leading member states towards the “Germanification” of Europe, with constant changes in the conditions of various treaties and loss of each nation’s national sovereignty.

The euro dollar war at its peak, with Greece right in the middle of this hurricane.

Indeed friends, the stakes are high, and from what it looks like both entities (the US and EU) are using Greece as a laboratory rat for their New World Order. When we here at hellasfrappe said months ago that we were an experiment for things to come, some laughed at us, others thought we worshiped conspiracies but from what it looks like we were right all along.

We don’t think that the FED just drafted this proposal up… in fact we are convinced it is probably part II or III of a bigger scheme. If you connect the dots then you will agree with us as well. They purposely placed George Papandreou in power, he purposely led us to the IMF from Kastelorizo Island (which today is in the middle of a Greek-Turkish dispute for natural gas) and they purposely piled us with debt to put us in a weak position and destabilize the Euro.

In fact we also believe they also encouraged Germany’s Angela Merkel to move ahead with the “Germanification” of Europe knowing very well that this would infuriate other member states to become dependent on the IMF as well (IMF equals the US).

In Greece’s case you do not really have to be a rocket scientist to also figure out that here they also planned to kill two birds with one stone. We all know this region ouzes with “black gold” and we also know how set the US is to re-design the boarders in the Mediterranean region on account of its energy war with Russia.

So in our case we were the first country to be used in this “test” because we are not some far east third world nation… We are the cornerstone of democracy, a European country and  positioned in an area that is of strategic importance for the US in its war against Russia, but we were also governed by a man that was chosen by the US to show the weaknesses of the euro… and from what it looks like, he was successful!

In any which way, we here in Greece are not stupid and not very accepting of this news. The reason for this is because the plan might sound like it holds many beneficial solutions…. but when you make a pack with the devil as Costas Simitis did back in 2000 with the infamous Swaps of Goldman Sachs, then you are just prolonging your death. Let us not forget we are in this position today because of his “expert Swap accounting tactics” back then.


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