In another fascinating interview, this time on CNBC, Dr. Marc Faber discussed the factors involved in the ongoing Greek crisis and made some interesting points.
Dr. Faber – who edits the Gloom, Boom and Doom report – is in no doubt that Greece will not be allowed to default because of both economic and geo-political considerations.
“It’s about the ECB and European banks that have lent money to Greece and if Greece defaults would have to take a huge loss and write-off. So they will lend more money and kick the can down the road.”
Of even greater significance is Greece’s strategically vital location as a gateway between the Black Sea and the Mediterranean. It is this geo-political factor which Faber believes will ensure that Greece is kept within the EU fold at any cost. For this reason he insists that Russia will never cede Crimea to the western powers.
“From the Black Sea, the Russian fleet can move into the Mediterranean. and without that, they can’t – they have no access to the Mediterranean, without the Black Sea and Crimea.”
Between the Black Sea and the Mediterranean, he adds, lie Turkey, Moldova and then Greece making Greece “a very strategically important part of Europe”.
The implication is that were the EU to cut Greece loose Russia would be only too happy to step in and potentially project military power directly into Europe.
Faber was then asked to clarify whether he was suggesting that the EU would never let Greece go so that “Putin … cannot recapture the glory of the Soviet Union.”
He subtly points out that imperialism is by no means confined to Russia and that Russia’s recent actions may have been in response to U.S. imperialism.
“Basically, America has had the Wolfowitz doctrine to contain countries like China and Russia.”
He goes on to highlight the new emerging geo-political order where emerging powers China and Russia grow ever closer. There was plenty of Asian media attention on Premier Xi’s visit to Russia.
In contrast, Britain’s election was regarded by western and some international media as being important. Faber believes there is evidence that the global influence of the UK and the U.S. is in decline.
He cites China and Russia’s ever-closer relationship as being more important than the the relative insignificance of Britain’s election and suggests China and Russia’s increasing power is a “new world order.”
He says that it may be that the EU will, until the eleventh hour, make threats and jawbone Greece in order to extract the best terms. Ultimately, however, they are left with little choice but to bail Greece out and postpone the inevitable for a little while longer.
Dr. Faber’s lucid analysis indicates that from both an economic and geopolitical point of view the world and particularly Europe, is in a vulnerable position.