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Europe Does It Again: Cyprus Depositor Haircut "Bailout" Turns Into Saver "Panic", Frozen Assets, Bank Runs, Broken ATMs
Europe has done it again.
Late last night, after markets closed for the weekend, following an extended discussion the European finance ministers announced their "bailout" solution for Russian oligarch depositor-haven Cyprus: a €13 billion bailout (Europe's fifth) with a huge twist: the implementation of what has been the biggest taboo in European bailouts to date - the impairment of depositors, and a fresh, full blown escalation in the status quo's war against savers everywhere.
Specifically, Cyprus will impose a levy of 6.75% on deposits of less than €100,000 - the ceiling for European Union account insurance, which is now effectively gone following this case study - and 9.9% above that. The measures will raise €5.8 billion, Dutch Finance Minister Jeroen Dijsselbloem, who leads the group of euro-area ministers, said.
But it doesn't stop there: a partial "bail-in" of junior bondholders is also possible, as for the first time ever the entire liability structure of a European bank - even if it is a Cypriot bank - is open season for impairments. The logical question: why here, and why now? And what happens when the Cypriot bank run that has taken the country by storm this morning spreads everywhere else, now that the scab over Europe's biggest festering wound is torn throughout the periphery as all the other PIIGS realize they too are expendable on the altar of mollifying voters and investors in the other countries that make up Europe's disunion.
Bloomberg's take on the sacrifice of Cyprus' savers:
Officials have struggled to find an agreement that would rescue Cyprus, which accounts for just half of a percent of the euro region’s economy, without unsettling investors in larger countries and sparking a new round of market contagion. Policy makers began meeting at 5 p.m. yesterday in a hastily convened gathering, seeking to overcome differences on bondholder losses while financial markets were closed.
“Further measures concern the increase of the withholding tax on capital income, a restructuring and recapitalisation of banks, an increase of the statutory corporate income tax rate and a bail-in of junior bondholders,” according to a communique released by ministers after the talks. It didn’t specify whether bank or sovereign bond holders could be affected.
The European Central Bank will use its existing facilities to make funds available to Cypriot banks as needed to counter potential bank runs. Depositors will receive bank equity as compensation.
Finance Minister Michael Sarris said the plan was the “least onerous” of the options Cyprus faced to stay afloat.
“It’s not a pleasant outcome, especially of course for the people involved,” said Sarris. The Cypriot parliament will convene tomorrow to vote on legislation needed for the bailout.
Needless to say, the locals are delighted:
In the coastal town of Larnaca, where irate depositors queued early to withdraw money from cash machines, co-op credit societies that are normally open on Saturdays stayed closed.
"I'm extremely angry. I worked years and years to get it together and now I am losing it on the say-so of the Dutch and the Germans," said British-Cypriot Andy Georgiou, 54, who returned to Cyprus in mid-2012 with his savings.
"They call Sicily the island of the mafia. It's not Sicily, it's Cyprus. This is theft, pure and simple," said a pensioner.
For the real response, look to Russia:
The island's bailout had repeatedly been delayed amid concerns from other EU states that its close business relations with Russia, and a banking system flush with Russian cash, made it a conduit for money-laundering.
"My understanding is that the Russian government is ready to make a contribution with an extension of the loan and a reduction of the interest rate," said the EU's top economic official, Olli Rehn.
Almost half of [Cyprus'] depositors are believed to be non-resident Russians, but most of those queuing on Saturday at automatic teller machines to pull out cash appeared to be Cypriots.
While "saving", pardon the pun, yet another insolvent country merely has the intent of keeping it in the Eurozone, and thus preserving Europe's doomed monetary block and bank equity for a little longer, this idiotic plan will achieve two things: i) infuriate not just Russians but very wealthy, and very trigger-happy Russians. The revenge of Gazpromia will be short and swift, and we certainly would not want to be Europeans next winter when the average heating level of Western European will depend on the whims of Russian natural gas pipeline traffic; ii) start a wave of bank runs first in Cyprus and soon everywhere else that has the potential of being the next Cyrpus.
Sure enough, here come the bank runs:
While the tax on deposits will hurt wealthy Russians with money in Cypriot banks, it will also sting ordinary citizens. Some ATMs in the country have run out of cash, Erotokritos Chlorakiotis, general manager of the Cooperative Central Bank, told state-run CYBC.
Forzen assets and "national bank holidays" are baaaaack:
Funds to pay the levy were frozen in accounts immediately, ECB Executive Board Member Joerg Asmussen said. The levy will be assessed before Cypriot banks reopen on March 19 after a March 18 national holiday. Sarris said electronic transfers will also be limited until then.
Europe's response: this is a unique situation. Just like the Greek bailout was unique; just like the Irish and Portuguese bailouts were unique; just like the bailout of Spanish banks was unique.
“As it is a contribution to the financial stability of Cyprus, it seems just to ask a contribution of all deposit holders,” Dijsselbloem said, noting the country’s financial industry was five times the size of its economy. The plan includes “unique measures” that address the “exceptional nature” of Cyprus and show “inflexible commitment to financial stability and the integrity of the euro area.”
Curiously, even everyone's favorite liar, former Eurogroup president, Jean-Claude Juncker, has a warning that this "bailout" is the worst thing Europe could have done:
Skeptics including Luxembourg’s Jean-Claude Juncker had said that imposing investor losses in Cyprus risked reigniting the financial crisis that has so far pushed five of the euro zone’s 17 members to seek aid. Last year, the euro area took what officials called a unique step to ask Greek bondholders to absorb losses.
But fear not: Europe has promised this absolute resolution taboo won't repeat itself...
When asked if a deposit assessment could be ruled out for future rescues, Rehn said in an interview: “It can and there is no concrete case where it should be considered.”
... Until it does repeat itself of course - after all the fundamental problem for Europe has never been resolved: the continent is still broke, and it still is running out of good, unencumbered assets (which as being repledged by the banking oligarchy) with every passing day.
Now the only thing unknown is Russia's response:
Corporate tax rates in Cyprus will rise to 12.5 percent to 10 percent as part of the deal, Dijsselbloem said. Rehn told reporters that Russia, whose banks have loaned as much as $40 billion to Cypriot companies of Russian origin, would ease terms on its existing loans to Cyprus as the rescue unfolds. Cyprus’s finance minister is scheduled to fly to Moscow on March 20.
What is known, however is that Cypriots have taken the news in stride.... and to their local ATM machine, which sadly is showing the following message: "Your transaction has been cancelled due to a technical issue. This ATM cannot complete withdrawals at this time" (courtesy of Yannis Mouzakis).
It didn't take long before the Cyrpus Cooperative bank issued a statement saying "some ATMs run out of cash" - by some they likely mean all as the entire country is now gripped in a full force depositor run.
Some other snapshots of what is currently happening in Cyrpus, where locals are using excavators if not to force the ATMs into "compliance" then to block bank entrances out of blind fury. From Philenews:
Indignant citizen who has the testimony of the Cooperative Credit Society Kyperoundas, cut the morning the entrance of the branch of the SEA, located on Avenue Nikos and Despina Pattichi in Limassol.
He said he believes that deceived by the assurances that the relevant deposits are insured citizens and decided how to express his protest, parking the excavator outside the entrance of the branch of SEA
And more from iefimeirda:
With the first light of day after the unprecedented decision to the Eurogroup on the terms of the Memorandum of Agreement and the taxation of savings, hundreds of people flocked to Cyprus stores credit cooperatives Larnaca to withdraw their deposits.
With the opening of stores found they could not withdraw all their money, because the electronic system of credit cooperatives was not working. And when it became possible, writes the Daily Cyprus, the system seemed to finally hit the appropriate amount of the new tax, which provoked strong reactions. Even after the government ordered the stores eventually closed.
At the same time, according to information or ATMs of banks give no money so that there is a huge inconvenience.
After lunch return to Cyprus President Papadopoulos Nikos Anastasiadis from Brussels in the morning reached political agreement on the rescue of the economy, while in the meantime the Presidential prepares emergency meeting of ministers of the government.
According to all the information, will this weekend be submitted and voted on bills in the form of urgency, before the banks opened Tuesday morning.
In the text of the agreement, with the characteristic title "We caught napping," the website says Sigma Live Nicosia agreed terms "under threat of closing banks." painful Describing the agreement, Sigma relies on sources from Brussels you speak of night thriller and roll jams, and the Cypriot delegation warned even withdrawal from the negotiations.
Congratulations Cyprus savers - you were just betrayed by both your politicians, and by Europe - sorry, but you are the "creeping impairments" in the game known as European bankruptcy. And so is anywhere between 6.75% and 9.9% of your money, which you were foolish enough to keep with your banks (where at least you were compensated with a savings yield of... 0%).
More importantly, as of this morning Europe has finally grasped that there is a 6.75% to 9.9% premium to holding physical cash in your mattress rather than having it stored with your local friendly insolvent bank.
Luckily Cyrpus is so "small" what just happened there will never happen anywhere else: after all in Europe nobody has ever heard of "setting an example". Or so the thinking among Europe's unthinking political elite goes.
And congratulations Europe: just when people almost believed you things are "fixed" you go ahead and prove to the world that you are as disunified (because size doesn't matter in a true union), as confused, as stupid and as broke as ever.
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Check www.corriere.it and tell me, where you found the headline
I said front page of the website, not headline.
Scroll half way down, it's still there. Same thing with Le Figaro.
Listening to RAI news right now. Nothing yet.
just mentioned.
5th news
- bank lineups
- depositors hit
- russian money
Short but not bad.
Not quite exact about "the only reason Cyrprus is in EU is to veto any Turkish attempt ... "
Quite true that Cyprus is geographically part of Asia and the Middle East, an island off the coast of Lebanon and Syria ...
But the reason it is in the EU, is that it is essentially part of Greece, which has other 'Asian islands' off the coast of Turkey.
The Greeks have tried to 'protect' Cyprus, and Greece told the EU if they did not let in Cyprus, Greece would block Poland and other Eastern European countries from joining the EU. The EU submitted to the blackmail.
---
When the Cypriots had their bloody revolution to win independence from the Brits in the 1950s, many if not most Cypriots wanted to simply merge with Greece.
To fight the revolution, the Brits with their typical 'divide and rule' tactics, like inserting lots of Jews into Palestine, the Brits inflamed Cypriot Muslims and Turks and encouraged increase in the small Turkish population.
After Cyprus became independent, many Cypriots still worked for merger with Greece, which in turn helped incite the Turish invasion of North Cyprus ... and it still remains a divided island today.
With Greek-speaking Cypriots today still sometimes just identifying themselves as 'Greek'.
I know a lot about that history.
As to Greeks blackmailing europeans about Poland, it sounds unbelievable but anything can happen.
I always thought it was in german interest to get Cyprus into EU, but no necessarily inton Euro.
I don't think Greece had to blackmail to get cyprus into euro zone, though.
That 'll teach to us to only choose Liechtenstein, Monaco, Switzerland or the British Commonwealth for our money laundering practices; we never learn don't we?
In other news, with faith in the European banking system amounting to a pound of shit, it completely and utterly surprisingseems that the only viable deposit destinations are being reduced to just the City and Switzerland. Now who would have ever foreseen such completely and utterly surprising unintended consequence?
And lastly, some comedic relief from The Economist - Cyprus: Make a model of it, not a mess
Switzerland is no more reliable, look for the "Weissgeldstrategie" by the CH government, they do not want any more non tax comlying clients, thanks to UBS...
"The thorniest issue in Cyprus is the uninsured depositors. At some stage Europe should have laws that force them to lose money in a bust. But, given the risk of precipitating panic elsewhere, this newspaper does not advocate writing them down now."
BANK RUN
Olli Rehn - enough said.
Dr. Paul Krugman - enough said.
+ 22 point something.
LOL, well done!
Ben Carson: Obama trying to destroy the country....
http://www.nationalreview.com/corner/343156/carson-obama-trying-destroy-...
Whole lot of folks in line with this guy...
Ben Carson is fantastic.
as always fuck the people fuck the savers, but by all means bailout the banksters and criminals - i mean politicians....
americans should be in gold and physical cash.... it is coming here very soon....
Yes
In geopolitical terms, this only helps the Fed and its USD: As the EU and its Euro gets shakier, the flight will be toward the Dollar. Plus they get to screw the Russians. Devious!
Yes, and US exports will get ass slammed.
Buddy, why so sceptical? We export what we're best at: 'Toys' R Us. Very expensive toys.
The bankers in Europe have moved on to blatant theft; they must have been observing Corzine and the J.P. Morgue.
If you keep money in the bank after this, you are in need of a brain transfusion.
I will start buying gold by the day until I have only one or two months worth of expenses in the account.
If this is not going to get gold going, people are really as stupid as what I sometimes fear!
How on earth could they think theis would end well. Or are the alternatives just so much uglier?
And the other European nations are watching. As they said, a trial baloon.
Get the fcuk out of the banking system.
+1 Every other Monday my wife and I make our 180 Mile round trip pilgrimage to our favorite coin shop to add to our Silver coin stash.....Banks are old school...
Done deal. Government by emergency is a dangerous force.
My savings is buried deep on the corner of Nunya and Kizmiaz.
Imagine you woke up today and you find out 10% of your savings is gone. What next? 20% next year? This is just the begining. The next three days should be very interesting.
Punishing savers - now there's something I would not have believed possible.
Great deadpan delivery!
The audience is howling ...
punishing savers - you are aware that most of the deposits belong to russian oligarchs and gangsters??
"Because some of these people are bad, it is ok/right to punish/kill all of them." - You, just now.
Borrow as much as you can from the bank, any bank, buy gold, default on the loan, run and hide = PAYBACK!
the problem is while banks are getting away with such behaviour, a normal citizen would end up in jail in no time :o)
@ Downtoolong
No...... Be ethical in your dealings even if the counterparty is not. Buying and holding gold (the old-fashioned way: honestly) will work out better in the long run.
+1 Beats going through life needing to constantly look over your shoulder.
It's obvious. It's the thing to do.
woooow almost 10%
thats pretty sick, the long time savers got screwed over... like always. history repeat itself, thats fo sho...
not only that the inflation eats away your money, the banks give you <1% interest and are now officially stealing your money too.
But at least its a good wake up call to think about what the banks and the system can do to your money and to you aswell.
Told ya. Knew that.
They did it precisely in Argentina, 2001.
... and again in 2008, when Kleptocrat Kristina added insult to injury by stealing everyone's pension, too:
http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/5504137/Arge...
The government didn't steal pensions, please, try to inform you better. The pension system was nazionalized BECAUSE private pension fund were stealing from people's pensions. As they did in the USA with several private pension funds.
After the nationalization, pensions worked and work a lot, a lot better.
Wow, there is really no fascist outrage on the part of that statist bitch Kirchner that you are not willing to defend, is there?
Argentinians: repeated suckers for statism for the last 100 years.
I have only been ONCE to Argentina, and that was briefly to Buenos Aires. So many talented people! Great potential. Really great food & wine.
But, yes, they keep electing even worse leaders than we do.
the new pope is out of the fat and into the fire, jeez i thought i left all these financial crisis behind me
You have to love this stuff! I mean really, nobody could write fiction like this. Taking a bite out of depositors is a new twist and is indeed part of the world wide war on savers. We all know now that the old model where people worked and earned and saved and deposited the savings in banks or money markets is now over. The new model is to steal all the savers interest, and now to steal the savers principle. The Bernanke and EU model is that economic growth and investment comes from printed money, not accumulated capital.
So let the printing continue. The bond holders and bankers must be bailed out with printing press trillions!
If European savers are smart, they will this as the dam breaking on a run to steal ALL their money. Cyrpus may be tiny, but they have set a new standard in this bailout.
I no longer belong to Netflix and I may cancel cable TV, all I need is an internet connection and ZH! This is just too entertaining for words!
Diversification will help each of us. You must get started preparing yesterday. Get some electrons OUT of the bank and buy some gold. Do what I just wrote, you'll be better off than 98% of non-farmers.
THANK YOU Tyler(s) for staying on top of what could be a very important story!
No worry mate, on monday Crocodile Draghi will back stop everything.
Whatever it takes.
That is why I am richer than you.
The haircut is the first step to having a shave.
Depsitors need to recognize that when they deposit funds they are in fact investing in mortgages. The same goes for bondholders.
When real estate values plummet so do the values of those mortgages.
By rights this culling of deposits would be the right way of fixing many problems provided:
1. Bond holders are hit in the same way
2. Shareholders of banks are wiped out
3, bondholders and depositors beome the new bank shareholders in proportion to the contribution they each make as a result of the cull.
Can someone tell me though where and how the proceeds of the cull are used?
to wipe one's ass
Total bullshit. Bankruptcy law states that, in the case of an insolvent bank equity losses first then unsecured bondholders then secured bondholders. That is typically at least a 40% cushion before depositors. The rule of law was broken when GS and Citi were saved. Now there is no rule of law in Amerika, only the rule of the jungle. GW and Hank Paulson started it and now Obama continues. The POTUS is nothing more than a mob boss with a big ass army protecting their bankster masters. Criminal psychopaths are now fully in charge.
Unfortunately, depositors have way less clout in the Halls of Power than shareholders. You nailed it: no more Rule of Law since the 2008-09 bailouts and QE. The biggest theft in the history of mankind continues unabated.
Forget bankruptcy laws and start thinking practicalities. Unless the pain is distributed across the board, it will simply ceate other forms of assymetric damage with further domino developments.
It's time for everyone to realise that they are both part of the problem as well as part of the solution.
Pain is baked in the cake and it belongs to the people who bought GS, Citi and all the other crooks bonds.
Soon we will have real negative interest rates all over the world.
It's ironic that even casino chips are safer than cash in the bank.
The truth is that the 10% cull is still very light compared to the dramatic fall in real estate values.
The question that remains is what happens to someone that cannot complete a transaction for which they have entered into a contract?
The bank lost the money in a boating accident.
I hope they have some guns N ammo.
Friend in Italy now says it's big news...people are starting to panic
remember governo amato
Wait until the Motherland does this to Italy Spain and Greece. Do these guys really think they can get away with their shit from a Country who dismantled all of Europe in WW2 in 3 years, and only lost because the USA stepped in?
Yes, it is ironic that the USA stepped in to defeat them and then to ressurect them.
How is it ironic? The highest European ethnic ancestry in the USA is German, and the second highest is Irish. This country is essentially a mix of 5 different cultures - German / Irish / English / African / Mexican / Italian / French - We're not as diverse as you might think. In fact we have half as many German people here as Germany does itself. And by the way the German population is mostly centered in the Republican Midwest - you know the part with no debt.
While the Pound is collapsing.
UK car industry suffer from a high Pound
http://www.am-online.com/news/2013/3/7/weakening-pound-hurting-the-car-i...
In other words UK economic "not shrinking" is paid by foreign investors who are bound to lose a lot of money.
Mortgage rate (2.5%) in the UK is under inflation level (3%). The money tree exists and you can find it in the UK.
Zerohedge found some problems in a village of Europe.
This must be joke.
My advise, love losing money permanently: go short on the Euro and put your money in the UK. The pro's are moving out now.
The Banksters and politicos are working over time to come up with this one. I think they stole enough to include ; overtime pay, kickbacks and big fat bonuses .
inflation is too slow to rob savers. decree more negative real rates. trick is to avoid making the real rates so negative as to trigger massive bank runs. in that event- bank holidays)))))) what a mess
Taking someone else's money without their consent. How is that NOT theft?
Wait, I've seen this before. It's not theft, they gave them perfectly good shares in the bank in exchange. Catch 22:
http://www.youtube.com/watch?v=E9wcK6qvCqI
Banksters stealing people's money. The Cypriots must not have a 2nd amendment that includes semi-automatic rifles.
I think they can still have the single-shot, muzzle loaded, flintlock pistols like those used by the Three Musketeers.
Attention all depositors, we central bansters want to grab your funds. First 6.5% then Later 10%, 20%, 30%....50%. We central banksters will try it in Cyprus and then move on to other countries!!!
Yes, eventually in the US as well.
We central banksters want your money and we want it now!!!!
All your deposits are belong to us.
I think the Germans want to be paid. This came from Brussels. Germans like to pick on small countries first. Th
Exactly. This was orchestrated out of Brussels by the International Monetary Fund, the European Central Bank and the European Commission. So this is a Euozone policy, not contained to just Cyprus.
This move is most definitely an indicator of the pain soon to be visited upon depositors across the rest of the Eurozone.
I saw lots of lines in Limassol today and no cash being spit out of the ATM's. Lots of nervous and pissed off people wandering around town desperate to find cash. I believe the EU is setting a precedent with this little escapade and if they get away with it, then the rest of Europe better look the fuck out. They'll lock you folks out of your ATM's and take 10% of your savings.
Luckily I only had 900 euros in my account so I won't screwed too badly but there are lots of folks here on unemployment and assistance who are getting hit even harder by the dirty little "bail-in". I have a feeling that Tuesday when the banks try to open, there will be blood. Lots of blood and anger. Cypriots are nice folks but they know how to fucking riot. Ask anyone who's seen the aftermath of one of their RAF Akrotiri protests. This is unfucking believeable.
This money grab still has to be endorsed by Parliament on Monday.
If Parliament burns down, maybe it won't pass.
"Officials have struggled to find an agreement that would rescue Cyprus, which accounts for just half of a percent of the euro region’s economy, without unsettling investors in larger countries and sparking a new round of market contagion."
So in other words those of us in the US are likely to be zapped soon so that we don't unsettle investors either even though it was our fucking $ to begin with that was invested and lost.Like I said....long bulldozers and short fried pig skin.
Europe's "theater of the absurd" continues unabated with no end-solution in sight. Cash is king? Cash just reached Emperor-status in Cyprus!
Get gold and silver!
FORBES : If Alan Greenspan Wants To 'End The Fed', Times Must Be Changing
by Nathan Lewis, Contributor
http://www.forbes.com/sites/nathanlewis/2013/03/14/if-alan-greenspan-wan...
But what does Rachel Fox think? Or Mila Kunis, for that matter?
by the way, bullish for the DAX?!
So what % of these depositors will now put the remainder in more risky assets like S$P? Shouldn't this be done here?
A government spokesman urged Cypriots not to panic, saying: “This decision is harsh but without an agreement it would have been tragic . . . s a choice between losing 6.75 per cent on Tuesday or losing everything.”
Well, that should restore confidence. And, how is this not terrorism?
russian former president Yeltsin - "There will be no default". The next day there was a default
It's financial fascism at full action. Why depositors? Why not: local politicians, EU politicians, bond holders, stock owners ????? Bastards are testing testing for much bigger criminal they are about to do
"And congratulations Europe: just when people almost believed you things are "fixed" you go ahead and prove to the world that you are as disunified (because size doesn't matter in a true union), as confused, as stupid and as broke as ever. "
Mmmhhmmm...
"fixed" is a CNBC/American thing. As I wrote many times, europeans "manage" a crisis - not that UK/US media will ever notice
disUnified? Eh, members can leave, can't they? The difference between confederative and federative principles, I fear
size DOES matter - this is quite disingenuos and glosses over the Cyprus real situation, the size of the bailout, etc.
confused, stupid and broke? too early to say, imho
No offense is intended but like bureaucract you would like to change the discussion to quible over semantics. While you may be correct in what you say it is beside the point which I think was pretty much amazement that they would stoop so low as to take money from bank accounts. Wile at the moment this is about Cyprus it exposes thier nature. Why do you quibble about it are you above idignation or you feel this is as at should be?
why bureaucrat? I'm an entrepreneur. Anyway, watch the reaction in continental europe over the next weeks and compare it with what would have happened in the english-speaking world. people here expect different "solutions" and have different expectations, coupled with a different legal and executive tradition
"a different legal and executive tradition" I hope you wrote that tongue-in-cheek given the fact that Continental Europe has a long tradition of Dictatorship and a long tradition of being liberated by English-speakers from the consequences of their own folly
Not shocked at all, but I still can't make sense of it.
perhaps because some important details are not being reported properly? In some media, I should add? go to echaterimi and read what Greeks are writing and commenting
Dijselbloem, IMF lady and German finance minister better check under their cars every morning. Also be careful for these bloody horseheads in your satin sheets. I am sure they will get increased security.
Now the only question is, when will the guillotines arrive? hujel
Buldosers?Check this out
http://www.youtube.com/watch?v=qlZh9-NQEyI
1 motivated man and a bulldozer= PRICELESS.
You can't spell Cypriot without the word RIOT.
The 10B Euro shortfall in Cyprus banks is if all things are normal.
That upper limit hair trim of 9.9% changes everything regarding the 68B on deposits. This changes everything.
People will be lucky to get 50% of their deposits out after the runs are through.
This is the Archduke Ferdinand assination moment of 1914 unless the EU comes back and says 'just kidding, no haircuts on depositors'.
"unless the EU comes back and says 'just kidding, no haircuts on depositors'."
Not likely to happen. The EU intends on stealing money.
That seems a real possibility.
I am surprised it is legal to take money from peoples accounts.
It would seem that this was done as a means to squeeze foriegn money - that could get very interesting.
"Legal"
LOL
There were fears of a run on deposits by Russian, Greek and British account-holders who are estimated to control almost half the €68bn of deposits in the Cypriot system when the system reopens.
Ya think?
And what happens to the fractional reserve system when this happens?
The Russian Army is likely to take Cyprus as collateral.
the brits pay £100m a year to rent two military bases in cyprus.. at dhekalia and akrotiri
forces personnel use british banks generally..wonder what happens to them and indeed profitable retail banks
http://www.cyprus-banks.com/
for domestics
and
for all banks
http://en.wikipedia.org/wiki/List_of_banks_in_Cyprus
What better reason to be "UNBANKED"
No wonder they trotted out the ancient mariner Greenspan yesterday to flog stocks.
I was travelling out of town Thursday/Friday and when I turned on the tv in the room in the morning it was already on CNBS and they were all giggly about having Alan "the walking corpse" Greenvomit as a guest. I had to leave before he was interviewed but I thought... "why the fuck are they dragging this half-dead old fuck back on tv again"? The shill-terrorist-hosts were even referring to him as "The Maestro" in the lead up to the actual interview as they cut to commercials for the criminal financial organizations that actually pay CNBS for advertising thinking that retail sheep actually have any money left to sign up for their bogus advice/services. But I digress...
Sadly (thankfully) I had to leave before "The Maestro" was interviewed. I doubt I could stand watching a rotting old sack of stinking flesh by the name of Alan Greenspan talk about the future when he is responsible for helping to destroy it in his younger years. It is amazing that CNBS keeps dragging his corpse out in front of a camera.
Here we go again but this time the neoCONzi's ponzi is out of bullets. You'd have to know from the recent bow wow dow new highs, ( wink wink not adjusted for inflation in 5 years should put us over 16K to keep pace with USDinker paper dollar dilution), there's something amiss. Like it only taking less than 90 daze for a crash to come rather than a year Fall 07 to crash of Fall 08. OMGoonzi the tax monies coffered and these markets more prone to crash than a horn dog gettin some on the crack of dawn.
I love how the mainstream media is tiptoeing around this by referring to it as a "levy" "docking savings" and a "tax". It is none of these things - it is outright theft by the banking cartel.
Just be thankful you are privy and aware. I used to try to make people aware but it is of no use. Just prepare. We all know where this is leading.
Who in their right mind would put any of their savings in a bank when there is zero interest? The stupid sheep got what they deserved! Trusting a bankster is the same as trusting a politician. They are cousins. Stupid is as stupid does.
It is out right theft and any one celled human brain with a lick of common sense knows its coming to a neighborhood near you. When I posted regularly I use to say the tiume will come when: 100% possession will be the law among these lawless banksters. You don't have it in your hands you won't be able to get to it. Haven't had a banksetering account in over 3 years. I do business just fine without letting the banksters have any access to any of my wealth. What I keep it in is nobodies business. Certainly not a paper asset linked to debt, as bonds in an imploding fiat currency system. Friggin corrupted system could vapoize suddenly over night with the likes of jpig morgue holding derivatives beyond the global gdp. Totally nuts and the masses are goon-a take it up the tail pipe big time with a free jiffy lube from the banksters. How soon? 2013 will have the mantra chaos attached to it as debt is wealth formerly. Freak show extravaganza upon us anytime via the crooked dead head fed in bed with the gov goon platoon.
It is out right theft and any one celled human brain with a lick of common sense knows its coming to a neighborhood near you. When I posted regularly I use to say the tiume will come when: 100% possession will be the law among these lawless banksters. You don't have it in your hands you won't be able to get to it. Haven't had a banksetering account in over 3 years. I do business just fine without letting the banksters have any access to any of my wealth. What I keep it in is nobodies business. Certainly not a paper asset linked to debt, as bonds in an imploding fiat currency system. Friggin corrupted system could vapoize suddenly over night with the likes of jpig morgue holding derivatives beyond the global gdp. Totally nuts and the masses are goon-a take it up the tail pipe big time with a free jiffy lube from the banksters. How soon? 2013 will have the mantra chaos attached to it as debt is wealth formerly. Freak show extravaganza upon us anytime via the crooked dead head fed in bed with the gov goon platoon.
so this plan is to "avoid disorderly bakruptcy" of their banks. the show must go on and we all pay for the privilige to see this shit show to never end. why? also, just think about the real role of the banks in the economy: why do we need them given the information availability now vs say 20 years ago....same goes for the "money managers". just saying......
Well, I guess this means cash is not safe in a european bank anymore....since they guarantee is meaningless (we can change the rules on you at any time).
This is significant. If I lived in Italy, Spain, Portugal etc etc...I would take out all my cash.
If this isn't enough to convince people to hold hard assets, nothing will, and the losers will have no one to blame but themselves
Holy St Patrick! There's a bank holiday in Ireland on Monday also. But somehow I don't think the Cyrpriots will be knocking back the Guinness; ouzo maybe (and wod-ka for the Russians), but Guinness I doubt it.
and they didn' cut public sector or pensions,
must have..so maybe the annswer to that is.."yet"
Could this be the first bit of deterioration in the fiat ponzi keystone?
1. OPEN MOUTH.
2. INSERT FOOT.
3. RINSE & REPEAT.
Aphthae epizooticae
http://en.wikipedia.org/wiki/Foot-and-mouth_disease
apathetic episodes
Here we go with those kooks at Zero Hedge again. For crying out loud, don't you realise that the people being bailed out are rich? Don't you realise what would happen if they weren't bailed out? They'd become un-rich - and then there's fewer opportunities for them to take junketing, global Ruling Class cretins off to swank resorts. Its almost like you guys want the rich to be treated just like any other sucker who lays down $200 in a casino ...errr...I mean, who invests in our economy. Geesh!
Djävla pucko Tyler. Om du vill rädda Ryssar...va fan e du communist eller? Du har allt så jävla om bakfoten så du är pinsam. PUCKO!
Can we assume that, if depositors are taking a hit, then all equity and all debt of the banks have been wiped?
Surely these would take a loss before depositors. No? Why not?
predicting bank runs in Italy and riots in Rome by Tuesday
The argument is that Cyprus launders Russian money and should therefore pay. Ok, well if that's the case;
1. Why was it allowed into the EU?
2. Why is not one banker in Cyprus facing a court case or Jail for money laundering.....cause according to the bailout it's irrefutable?
3. What incentive is there to hold money in any bank, as an honest saver, if you will pay for their bad decisions and mis-demeanours with no reproach whatsoever?
This situation is seriously f***** and sets dangerous precedents for all to heed. Your hard earned assets are at someone else's whim in a bank!
Will not happen, they have a brandnew pope, no government and serie a. What else do you want more?
I hope this action is a warning order for those few people in the USA who can think but still thought keeping money in digital form in anything the FedGov can touch was an option.
As for me it comes in the Credit Union -> withdrawn FRNs -> converted to Au, Ag, Pb, food, necessities. Some paper money held for daily stuff, not much.
Even coffee is better way to avoid inflation and confiscation than anything Wall St. has - no counterparty risk.
BTW, fuck the Eurozone, and all Central Banksters.
i wonder what will happen on monday? will gold surge? or will they short GLD tooth and nail?
small bid in gold would expect
markets deal in trillion these days, the race to debase is on, wait a week or two, then it will be a greek re-run, then a close finish between italy, portugal, ireland, spain, france, belgium and holland
the scandis, germany and the uk are running their race at low revs to go a much longer distance before the shtf
i wonder how the depositors in the banks that haven't lost a cent will feel about this...like Lloyds and Barclays bank of the UK.lucky the haircut gets paid to the government...wiat to the european government (troika)...but just a second..why should the troika receive anything at all when it did not incur a loss?
oh..i see..the troika is making a loan at x% for x years, provided it gets the money for the loan...immediately... and cyrpus is turned into an economic desert
http://en.wikipedia.org/wiki/List_of_banks_in_Cyprus
i guess all the companies just lost some of their (petty?) cash too
'cyrpus is turned into an economic desert'
Or from the Troika's perspective, an economic dessert.
Would you like whipped cream on top?
long as she wears a yashmak, can belly dance and doesn't have hairy..armpits
What can you do with people that refuse to investigate after they have been given information that contradicts the information they suspect is bullshit.? I have a hard time feeling sorry for people that don't do anything to defend against the same entity they were warned would cut their throat.
LMAO
First they came for the wealth of the Cypriots....
But I did not care because I was not a Cypriot.
Jim Sinclair stated the death of the fiat banksters would not come via a too big to fail bank but a smaller one internationally beginning the crashcading of derivatives. Is this it? Could be! Some have said when the collapse begins there will be time to square financials up from the US perspective. We may have our 2-4 weeks as the EU ignites and burns across the pond. We may just get the plug pulled globally so not one citizens around the world gets access to digi monies. You don't know but you don't want to be a day late when the nuclear vaporization of 750 trillion to 1 quadrillion derivatives becomes a bright new big bang financial galaxy sized black hole. That's when you just bendover bentrod burnokio style and take the free global imloding monetary jiffy lube like a man. Fire in the hole!
MF Global.
Haircut on small country bank deposits
Seem like bankster trial balloons to me.
I hope the Cypriots go berserk.
Russian oligarchs too.
Former BoC chief wins €2m in compensation compromise
UNDER threat of litigation, the Bank of Cyprus (BoC) has awarded former CEO Andreas Eliades compensation to the tune of some €2 million.
http://www.cyprus-mail.com/bank-cyprus/former-boc-chief-wins-2m-compensa...
i think the only bottle parties in cyprus are now of the molotov cocktail variety
http://www.cyprus-mail.com/cyprus/parties-furious-over-eurogroup-decisio...
The heavily indebted country is not the place to keep your money - a zero percent interest rate on a savings bond of CD. In Moldova - a country with virtually no debt you can get a 6 percent CD - yes 6 percent guaranteed. In 1998 it was bad there. This Europe thing might take a while to resolved. I'd say they're about 5 years into a 10-15 year mess.
which one have got money with?
http://en.wikipedia.org/wiki/List_of_banks_in_Moldova
wow, moldova is four times bigger, population wise than cyprus
https://www.cia.gov/library/publications/the-world-factbook/geos/md.html
I meant Australia.
You might want to reconsider that timeline.
In 2008 with the financial crisis, the Fed noticed an electronic run on the banks and had to raise the FDIC insurance to avoid economic collapse in 24 hours.
http://zerohedge.blogspot.com/2009/02/how-world-almost-came-to-end-at-2p...
None of this is actually happening 'cause it's not on Bloomberg.
My apologies, it's there...way down the page. Let's see where it is on Monday. CNBS should mention by Wednesday.
I looked CNN. It's buried there too. It'll be interesting to see come Tuesday. If I lived there I would withdraw every cent left.
Strange, isn't it. I noticed that it is hardly mentioned on the manstream financial news sites like CNBS et al, but the story has been running all day on the front page of the New York Times and Washington Post. The story in the times was particularly good. And the Post article even suggests this will spark a renewed Eurozone crisis. But the financial press is trying to bury it. Hmmm...
"even suggests this will spark a renewed Eurozone crisis" ... When did it stop?
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Posted by Neil Irwin on March 16, 2013 at 4:18 pm
It is a bad day to have your money deposited in a bank in the Mediterranean island nation of Cyprus. And it may just mean some bad days ahead for the rest of us.
Early Saturday, the nation reached an agreement with international lenders for bailout help. Part of the agreement: Bank depositors with more than 100,000 euros ($131,000) in their accounts will take a 9.9 percent haircut. Even those with less in savings will see their accounts reduced by 6.75 percent. That’s right: Anyone with money in a Cypriot bank will have significantly less money when the banks open for business Tuesday than they did on Friday. Cypriots have reacted with this perfectly rational reaction: lining up at ATM machines to try to get as much money out in the form of cash before the money they have in their accounts is reduced.
What makes this important for people who couldn’t locate Cyprus on a map is this: It is one of the 17 nations using the euro currency, the fact that it’s a lot closer to Beirut than to Paris notwithstanding. European officials have spent the past six years moving heaven and earth to ensure that no depositors with the continent’s banks suffer a loss despite the financial strains the banks have been under.
Most dramatically, the Irish government in the fall of 2008 backstopped its banks, putting its public finances through a wringer. Even as the Greek economy has fallen into depression and Spanish bank losses on real estate have reached dangerous levels, the European Central Bank and the continent’s government have ensured that bank deposits were safe. They have feared that if depositors in any country were forced to take losses, it would spark a destructive cascade of withdrawals across Europe....
In other words, if there is going to be a new wave of crisis in Europe, historians will be able to trace its starting point back to today’s Cyprus bank bailout.
And kudos to the Post for running this front page. They know this is a very, very, big deal. Perhaps that's precisely why the financial media is ignoring it.
Frankly, I don't agree with that assessment by the author. I believe that depositors' savings have always been on the radar of the European slimeball political elites to solve their self-made crises, save their precious Euro currency and save themselves. What has prevented them from doing it up to now is fear of the consequences (riots, lynchings, bank runs and the rest).
We may begin to see WANTED DEAD or ALIVE posters appearing in Europe bearing the names of the ringleaders of this EU criminal gangster enterprise.