Felix Zulauf interview part 1: All important banks have to be nationalized immediately

The financial market expert Felix Zulauf expressed his opinion in an interview for Wirtschaftswoche Online that the only way to prevent the global banking system from collapsing is the nationalization. Greece will not be the only country that will have to give up because of the economic depression, says Zulauf.

Mr. Zulauf, which large European banks will soon run out of air?

Felix Zulauf: In principle, several banks in Europe are already bankrupt, probably even some in the U.S. But governments are not a big bank went bankrupt.

Why not?

The failure of a large bank would lead to another failures since the first bank has been purchased credits or derivatives of the others. It would therefore be a chain reaction and ultimately come to the collapse of the financial system itself. In order to prevent that from happening, over the next two to three years more banks will be nationalized, in the peripheral countries, but also beyond.

Large nationalization will be cheaper in three to four years?

That is right. During the crisis, then all important banks would have to be nationalized immediately - at low prices. Then you would have to suspend bonus payments and maintaining and the bank moves to a stronger capital bases. In its current form, many banks will not survive.

Felix Zulauf predicts dark times for the Euro and nationalization of the credit system

The Swiss investment manager Felix Zulauf once again shared his extremely dark forecast for the future of the world as the owner and president of Zulauf Asset Management recently participated in Barron's Roundtable. Mr. Zulauf commented that the euro is a misconstruction. He reminded his January expectations, when he waited for the disintegration of this currency to begin in the second half of this year.

If that happens, it should lead the world into financial and economic chaos. The Swiss investment manager's two major themes into 2013 are euro disintegration and China weakness, due to the bursting of a real-estate boom.

Felix Zulauf considers the credit markets to be an explosive cocktail. The tower of debt is compounded by the gigantic over-the-counter derivatives market. In the past 10 years the notional value of derivatives worldwide has grown from $100 trillion to almost $800 trillion.