Former White House Official – Europe In Danger Of Mega-Bank Runs That Jeopardize The World

"Today a former White House official and Plunge Protection Team member warned King World News that Europe is now in danger of mega-bank runs that will destabilize the entire global financial system.  Former presidential adviser and member of the U.S. President's Working Group on Financial Markets, Dr. Philippa Malmgren, also discussed why the bank runs may spread across the Atlantic to the United States, eventually engulfing the entire world in chaos.

Eric King:  “It now appears at this point that the multiple bank runs in Europe have the ability to spread and create massive contagion.”

Dr. Philippa Malmgren:  “We have seen Banco Santander, which is considered the most important of the continental banks in Europe, recently announce without any warning that they didn't have enough cash and they had to do a very sudden and abrupt cash call of almost $8 billion just to stay alive….

Continue reading the Dr. Philippa Malmgren interview below…

“This started a bank run at Banco Santander.  As much as 30 percent of the deposits in the U.K. were immediately withdrawn.  So this was of course a very big event and it has contributed to further euro weakness.  The fact is that when the biggest bank in Europe tells you without any warning that they need $8 billion just to keep the doors open, this is a big story.”

Increasing Number Of Bank Runs

Eric King:  “We are now seeing serious bank runs develop in Europe.”

Dr. Malmgren:  “Yes.  Now we have the four biggest Greek banks that have requested emergency assistance because they are experiencing bank runs.  The ECB is already being asked if they can support them.  So the bank runs are spreading.  And I think the worry is that central banks don’t have the resources to do a bailout.  This is another reason why Federal Reserve officials are saying it’s too early to raise interest rates.  It’s because big events are happening in the background.  So yes, there is systemic risk in the European banking system and now these weaknesses are starting to be exposed.”

Entire Global Financial System At Risk

Eric King:  “How bad could this situation get?  We saw bank runs in Europe once before and it got pretty dicey.  Will we see a repeat of that or something even worse?”

Dr. Malmgren:  “Yes.  All that happened before was they put enough cash into the system so that it temporarily hid the problem.  But the fundamental problems have been there from the start.  All these banks have too much debt, not enough cash, and they are very vulnerable.  In fact they are a source of vulnerability to the entire global financial system..."

at http://kingworldnews.com/former-white-house-official-warns-europe-in-danger-of-mega-bank-runs-that-endanger-the-world/