Clinton….pointing finger at Europe

The Slog understands that President Obama has been briefed about the inevitability of major fiscal collapse in the eurozone.

American eyes have, over the last week, been largely focused on Asia in general, and the China/Japan spat in particular. Treasury Secretary Geithner last week gave accusatory evidence to a Congressional committee, alleging that China has begun playing an active role as currency manipulator of both the Yen and the Dollar. For once, the Slog agrees with the Fed: it’s difficult to view the PRC’s switch in debt-ownership strategy in any other light.

But away from the microphones and cameras, a team assembled by people close to Hillary Clinton has spent time appraising Barack Obama of a potentially bigger – and faster – catalyst of currency anarchy: the eurozone debt crisis.

The Slog posted earlier today about Pimco’s clear and firm belief that EU/ECB spin and trickery is not merely smoke and mirrors: it is actually adding to the certainty of debtor nation collapse and – beyond that – putting the EU central bank itself in jeopardy. I’m led to understand that one of the advisers to the White House under Clinton’s aegis has been Bill Gross the Pimco Chairman. He -along with other senior banking opinion leaders – have left the President in no doubt as to the ‘90% inevitability’ of the EU sovereign and bank debt powder-keg exploding before too long.

Secretary Clinton has become frustrated in recent months by the crazy politics of EU foreign policy turf-wars. “She gets pissed with five different versions from three different offices” said a person close to developments, “and this has acted as a stimulant for Hillary. She is somebody who must have the truth. If she thinks people are dicking her around, she will go dig in another place”.

The two theatres of currency – Europe and Asia – are not mutually exclusive. Far from it: in the mad globalist world of rice-paper dominoes, a Tokyo decision to try and extricate itself from safe-haven status will put pressure on the Swiss franc – and this in turn will be hugely amplified by further instability in the eurozone.

The truth is that Hillary Clinton has struggled to elucidate Obamite foreign policy, but she is infinitely more savvy than the President. Her own attempt to introduce a healthcare Bill while she was First Lady massively increased her financial literacy. She knows a trade war is coming. As Pimco’s CEO Mohammed El-Arian wrote earlier today:

‘The list of industrial countries wishing to depreciate their currencies is not matched by a list of emerging economies happy to let their currencies appreciate significantly. As a result, foreign exchange tensions are mounting’.

Clinton is renowned as somebody who always thinks three moves ahead. She also likes Tim Geithner – who has facilitated her access to the President on this issue. I suspect that planned leaks of her intelligence role in deconstructing the eurzone spin-bollocks are the first bricks in her Wall of Persuasion leading to a White House bid in 2016.