A Day Of Reckoning For The Euro Has Arrived 26 TRILLION In Currency Derivatives At RiskMichael Snyder The new prime minister of Greece, Alexis Tsipras, has already stated that he will not accept an extension of the current bailout. Officials from other eurozone countries have already said that they expect Greece to fully honor the terms of the current agreement. So basically we are watching a giant game of financial chicken play out over in Europe, and a showdown is looming. Adding to the drama is the fact that the Greek government is rapidly running out of money. According to the Wall Street Journal, Greece is on course to run out of money within weeks if it doesnt gain access to additional funds, effectively daring Germany and its other European creditors to let it fail and stumble out of the euro. We have witnessed other moments of crisis for Greece before, but things are very different this time because the new Greek government is being run by radical leftists that based their entire campaign on ending the austerity that has been imposed on Greece by the rest of Europe. If they buckle under the demands of the European financial lords, their credibility will be gone and Syriza will essentially be finished in Greek politics. But if they dont compromise, Greece could be forced to leave the eurozone and we could potentially be facing the equivalent of financial armageddon in Europe. If nobody flinches, the eurozone will fall to pieces, the euro will collapse and trillions upon trillions of dollars in derivatives will be in jeopardy. According to the Bank for International Settlements, 26.45 trillion dollars in currency derivatives are directly tied to the value of the euro. Let that number sink in for a moment. To give you some perspective, keep in mind that the U.S. government spends a total of less than 4 trillion dollars a year. The entire U.S. national debt is just a bit above 18 trillion dollars. So 26 trillion dollars is an amount of money that is almost unimaginable. And of course those are just the derivatives that are directly tied to the euro. Overall, the total global derivatives bubble is more than 700 trillion dollars in size. Over the past couple of decades, the global financial system has been transformed into the biggest casino in the history of the planet. And when things are stable, the computer algorithms used by the big banks work quite well and they make enormous amounts of money. But when unexpected things happen and markets go haywire, the financial institutions that gamble on derivatives can lose massive quantities of money very rapidly. We saw this in 2008, and we could be on the verge of seeing this happen again. If no agreement can be reached and Greece does leave the eurozone, the euro is going to fall off a cliff. When that happens, someone out there is going to lose an extraordinary amount of money. And just like in 2008, when the big financial institutions start to fail that will plunge the entire planet into another major financial crisis. So at the moment, it is absolutely imperative that Greece and the rest of the eurozone find some common ground. Unfortunately, that may not happen. The new prime minister of Greececertainly does not sound like he is in a compromising mood Prior to the summit on Thursday, eurozone finance ministers are going to get together on Wednesday to discuss what they should do. If these two meetings dont go well this week, we could be looking at big trouble right around the corner. In fact, Greece is being warned that they only have until February 16th to apply for an extension of the current bailout And as I mentioned above, the Greek government is quickly running out of money. Most analysts believe that because of the enormous stakes that one side or the other will give in at some point. But what if that does not happen? Personally, I believe that the eurozone is doomed in the configuration that we see it today, and that it is just a matter of time before it breaks up. And I am far from alone. For example, just check out what former Fed chairman Alan Greenspanis saying The Greeks are using all of this to their advantage. They know that if they leave it could break apart the entire monetary union. So this gives them a tremendous amount of leverage. Greek Finance Minister Yanis Varoufakis has even gone so far as to compare the eurozoneto a house of cards After all this time and after so many bailouts, we have finally reached a day of reckoning. There is a very real possibility that Greece could leave the eurozone in just a matter of months, and the elite know this. That is why they are getting prepared for that eventuality. The following is from a recentWall Street Journal report And if Greece does leave, it will cause panic throughout global financial markets as everyone wonders who is next. Italy, Spain and Portugal are all in a similar position. Every one of them could rapidly become the next Greece. But of even greater concern is what a Grexit would do to the euro. If the euro falls below parity with the U.S. dollar, the derivatives losses are going to be absolutely mind blowing. And coupled with the collapse of the price of oil, we could be looking at some extreme financial instability in the not too distant future. When big banks collapse, they dont do it overnight. But we often learn about it in a single moment. Just remember Lehman Brothers. Their problems developed over an extended period of time, but we only learned the full extent of their difficulties on one very disturbing day in 2008, and that day changed the world. As you read this, big financial troubles are brewing in the background. At some point, they are going to come to the surface. When they do, the entire planet is going to be shocked. This article first appeared here at the Economic Collapse Blog. Michael Snyder is a writer, speaker and activist who writes and edits his own blogs The American Dream and Economic Collapse Blog. Follow him on Twitter here. 