Financial shares in several large U.S. banks tumbled in late trading on Wall Street last week because of exposure risk to bad eurozone debt. It is a sign the current financial crisis in Europe may be about to spread across the Atlantic.

The fall in shares came after the release of a report by Fitch Ratings Agency on November 17. Over the next few hours, financial shares for major U.S. banks JP Morgan Chase and Bank of America fell 3.8 percent each. Investment bank Morgan Stanley lost 8 percent of its market value, while the Goldman Sachs Group had financial shares fall 4.2 percent.

The Fitch report stated that the creditworthiness of U.S. banks will take a serious hit if the eurozone debt crisis deepens and spreads beyond the five most-troubled nations. “Unless the eurozone debt crisis is resolved in a timely and orderly manner, the broad outlook for U.S. banks will darken,” the New York-based ratings company warned. “The risks of a negative shock are rising.”

The report highlighted how the six biggest U.S. banks—JP Morgan Chase, Bank of America, Citigroup Inc., Wells Fargo & Co., Goldman Sachs Group and Morgan Stanley—have some $50 billion in direct lending tied into banks in Portugal, Italy, Ireland, Greece and Spain.

While U.S. banks have hedged some of their risk with credit-default swaps, those may not be effective if voluntary debt forgiveness becomes “more prevalent” and the insurance provisions aren’t triggered, the report says.

In the words of Niall Ferguson, “Just as European institutions once loaded up on assets backed with subprime U.S. mortgages, so most big U.S. banks have at least some exposure to eurozone bonds or banks. One institution—MF Global, run by former Goldman Sachs ceo Jon Corzine—just blew up because of its highly levered euro bets. Others are biting their fingernails because it is suddenly far from clear that the credit-default swaps they have bought as insurance against, say, a Greek default are worth the paper they are written on.”

Many bankers are waking up to the fact that no matter how much Wall Street cuts its ties to Europe, it is too late to eliminate the risk that the eurozone crisis could engulf the U.S. financial system.

In addition to the $50 billion in direct lending to European banks in troubled nations, American banks owe another $131 billion to banks in the rest of Europe, according to the Bank of International Settlements. When the value of credit default swaps is added to the figures, the total exposure of American banks to the European debt markets amounts to $767 billion.

So, if a Greek default triggers a major financial crisis in Europe, America could be hit with a catastrophe that could dwarf the Lehman Brothers debacle. The U.S. economy is especially vulnerable to the European sovereign debt crisis right now because it is still suffering from the effects of the 2008 financial meltdown.

“It won’t take much to tip us into another recession,” said Sung Won Sohn, an economics professor at California State University, Channel Islands. “If Europe gets into any deeper trouble, it will take us and the rest of the world down, too.”

For nearly two decades, the Trumpet staff has warned specifically that a spectacular global financial crisis, centered in the United States, would trigger the emergence of a globally dominant, German-led bloc of European states. We have not been entirely alone in this expectation.

The following is a snippet from a secret memorandum written by high-ranking German officers and distributed among an elite group of German leaders in Bonn and other parts of the world. It is an electrifying picture of current events!

Economic difficulties will one day plunge the United States down from its present dizzy heights. Such a catastrophe can be brought about through crafty manipulations and through artificially engendered crises. Such maneuvers are routine measures which have already been employed in international power struggle and will be used again and again as long as economic rivals fight for power positions and markets in the world. It is quite conceivable that America, weakened by a depression, will one day seek support from a resurrected Germany. Such a prospect would open tremendous possibilities for the future power position of a bloc introducing a new order in the world.

That was written in 1950. It can be found in T.H. Tetens’s 1953 book Germany Plots With the Kremlin.

Though there are those who refuse to admit it, the present European debt crisis was engineered by Germany as a means to conquer the continent of Europe. As we wrote in the April 2010 edition of the Trumpet:

After the EU single currency system was implemented, certain voices predicted the failure of the euro. A handful theorized that the euro may well even have been deliberately created to fail by certain German elites. The theory was that Germany would bide its time and allow the unworkable monetary union to prevail till it reached a point of collapse and then, having wrested control of the European Central Bank (ecb) out of any competitor’s hands (read France, in particular), move in quickly and take direct control of [European Monetary Union] administration. Germany could then ensure that a preferred core of EU member nations would receive ecb favor, with the disfavored reduced to vassal status or worse.

The same “crafty manipulations” that have laid out all of Europe at Germany’s feet, combined with America’s own financial mismanagement problems, could indeed “plunge the United States down from its present dizzy heights.”

A world-changing financial crisis is on the horizon! As the current financial crisis plays out, it will force both America and the weaker nations of Europe into subjection to Germany.

For more information on how Germany is using the current financial crisis to reshape itself into a global superpower, read editor in chief Gerald Flurry’s February editorial, “A Monumental Moment in European History!”