The speculative boom created by loose fiscal policy in western nations is obviously reaching its conclusion, with assets proving worthless because investment was made poorly since it was not market driven, but instead originated with the central planners/manipulators. This comment from the article: "The ECB is in a no-win situation now that it has become an enormous bad bank or, in other words, a dumping ground for bad loans, including ones from Ireland." No one knows how much bad collateral banks in the US hold either, due to changes in accounting rules meant to protect banks, but liable to compromise the system itself. As these bank assets go bad, the banks are instead backed by fiat currency, itself borrowed into existence by bankrupt governments, themselves deep in the hole, and still chronic over spenders. Today the Euro is pulling ahead in the "race to the bottom" among fiat currencies, but don't worry, the dollar is giving it "a run for its money".
The Hidden Cost of Saving the Euro: ECB's Balance Sheet Contains Massive Risks - SPIEGEL ONLINE - News - International: http://www.spiegel.de/international/business/0,1518,764299,00.html
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