Saxo Bank CEO: "Is Cyprus Deposit Levy The First Sign Of Widespread Wealth Tax?"

Tyler Durden's picture

Authored by Lars Seier Christensen, via his blog at,

Confusion reigns supreme in the Cyprus bailout. So it is fairly risky to stick out your neck commenting on an unknown outcome that could leave you exposed to ridicule in hours if things change. And this blog is not intended to be a daily or even weekly commentary as I am not providing short-term trading advice, meaning that it is tempting to just wait and see what the outcome will be.

However, as this is so far the most important macroeconomic event of 2013 and it is continuously developing in new and perplexing ways, I feel it is necessary to try to make some sense out of what we are observing and hearing.

What we know now is that the Cypriot parliament has rejected the bailout package after a poker game with the Troika, trying to deal many different hands varying from zero percent deposit tax for the smaller depositors to 15 percent on the larger ones. None of the combinations have proved sufficiently appetising to secure a deal so far.

Read more about this .. here.

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WayBehind's picture

Yes, it is! And if you have any cash in our bank ... well, the cash is ours!

flacon's picture

Who keeps large amounts in digital currency anyway? I can see a couple grand to pay the bills, but other than that I find it had to believe that mankind is stupid enough to keep hundreds of thousands of "units" of data ("money") in a "bank". I simply don't believe it. Nobody is THAT stupid. Are they?

Double.Eagle.Gold's picture

when you have 8 figures, it becomes more problematic...

Ratscam's picture

you are mixing cash with assets.
very few have 8 digits in cash, yes though in stocks, bonds, funds etc.
If you buy shares, futures, bonds, etc. they cannot deduct a percentage of your wealth, so far, unless you sell your assets or they expire.

Ahmeexnal's picture

Why did the teutonic kleptocrats pull such a vulgar theft attempt on the people of Cyprus (and on the people of Russia)?

Answer: Deutsche Bank is completely freefalling and about to enter the last second (i.e. splatter on the floor). The oligarchs (german imperial family) who will be wiped out are in complete PANIC mode.

Now Russia knows that they can't trust the germans (they have known this for centuries, but this was just another confirmation) and Putin will pull the plug on the euro.
Time for another weimar-style episode for Germany.

Long Ruble, short Euro and Douche Bank.

edit: when the euro hyperinflates, the most likely scenario will be europe adopting the US Dollar. Then that too will suffer the same fate.

MisterMousePotato's picture

Wasn't the first sign inflation? If every year your savings decrease by ? who knows ? two percent? five? ten?

Well, what's the difference between that and a tax?

To be sure, it's a bit more subtle, but otherwise?

Does make you wonder why the hamfisted thing in Cyprus.

wintermute's picture

Ahmeexnal, I see you are smart enough to know that fiat is doomed, I also have read your comments labelling Bitcoin as ponzi.

I urge you to at least take a day out and read about how this currency works, why it cannot be confiscated, and why it is as good as virtual gold. It has a strong user base in Russia and Ukraine.

Even a small allocation of 10% of ones personal  investment funds is a sensible step. The trick is now to find a pull-back in price to get in as it has spiked a lot in 2013, even considering its powerful fundamentals.


JohnnyBriefcase's picture

Can you hold it in your hands and defend it with firearms?


I guess I don't see the benefit...

wintermute's picture

Yes, you can. Your holdings can be stored on any USB pendrive, or even the private key (a few dozen letters and digits) can be hammered into a metal plate and stored with your spare guns in a cannister in the ground for years. No problem.

JohnnyBriefcase's picture

And if I brought that to the local market (post financial collapse)and tried to trade my usb drive for bread, they would accept it?

Ahmeexnal's picture

A victim of collision on the open sea
Nobody ever said that life was free
Sank, swam, go down with the ship
But use your freedom of choice

I'll say it again
In the land of the free
Use your freedom of choice
Your freedom of choice

In ancient Rome there was a poem
About a dog who found two bones
He picked at one, he licked the other
He went in circles, he dropped dead

Freedom of choice
Is what you got
Freedom of choice

Then if you got it, you don't want it
Seems to be the rule of thumb
Don't be tricked by what you see
You got two ways to go

I'll say it again
In the land of the free
Use your freedom of choice
Freedom of choice

Freedom of choice
Is what you got
Freedom of choice

In ancient Rome there was a poem
About a dog who found two bones
He picked at one, he licked the other
He went in circles, he dropped dead

Freedom of choice
Is what you got
Freedom from choice
Is what you want

Which metal are those bitcoins hammered into? Unless it's a metal known to be...the best electrical conductor, reflector, PURE ENERGY when used in conjunction with H2O2 , and has a proven track record backed by millennia as a store of value....I'll pass for now.

JohnnyBriefcase's picture

Yeah, let me just check back in three thousand years and see how that bitcoin is holding up...


Until then keep "stacking".

flacon's picture

I don't like bitcoin either, but let me check back in three thousand years and see how Johnny is holding up. Having said that I don't want to be buried with any gold, silver or platinum because three thousand years from now I wouldn't mind having my body be at peace with the ground and not dug up by some space alien gold detector created by the government. 


steve from virginia's picture




A 'tax' that prompts a bank run that unravels the world finance system and causes it to crash isn't very useful.


Is it?

NoClueSneaker's picture

Douche Bank is on Bernank's tit, and fucks around with 3-4 Tr. in derivatives . ( Don't fuck with the Feds ). But .... Germany has some 3000 insolvent banks, and I ask myself why is a craphouse of Commerzbank still standing ???


Texas Ginslinger's picture

Cyprus situation is a tax on tax dodgers.

You need to clarify that.


Matt's picture

"Since, ALLEGEDLY, some of these people are tax dodgers, it is ok to confiscate money from all of them." Is that really what you mean? You don't really believe that?

seek's picture

Given current rates of return and volatility, it's much more common now to keep a large cash accounts.

If you're conventionally wealthy (e.g. earned the money over time, and can't count on $10M bonuses to refill the pot), this is truly a challenging environment ro manage risk. You stay away from stocks because it's a Fed-induced fraud freakshow, bonds because you can't trust ratings, funds because withdrawls can be limited (e.g. break the buck), banks are/were considered lower risk, and now that's coming under fire. I know several elderly couples that are basically 100% cash due to unfavorable risk profiles v. return, and can't criticize their choice.

I know the standard answer here is PMs, but you still have the issue of getting money in/out of the system with them and volatility risk as well as security.

I have little doubt when the days comes (in the US at least) that they go to grab cash in bank accounts that IRA balances, private stock holdings etc will be subject to taxes as well. It'll trigger insanity (it will be, in effect, a margin call on the entire financial system) as people simultaneous sell investments to cover taxes with no buyers.


Pure Evil's picture

Have we all forgotten that the vast majority of corporations are all in cash?

The question we should ask is where is Apple stashing its cash?

Cash Stash

Obviously, why steal from the mere mundanes when the corps have all you need.

skipjack's picture

Heh - guess you weren't paying attention re MF Global et al. Good luck with stocks, bonds, etc.

ArkansasAngie's picture

And ... It is hard to find good investments
I'll not buy stocks or bonds
I bought real estate when it was fairly valued
I've got pm's
It's a problem

Clayton Bigsby's picture

Not if it's in physical, it ain't

Stoploss's picture

LOL!!!  I was looking at rates history today, and some old bank statements.

It appears that the US was the first one to seize savings through,....

Wait for it.


Wait for it...




jazze's picture

Why would the US piss of its voting citizens by stealing 29% of their wealth to pay back the chinese, japanese and the Fed?

Especially with the world's most powerful military


I don't get how the 29% tax thing is going to happen.

LawsofPhysics's picture

Ask yourself, what is the average "wealth" of the average voter?  

akak's picture

Before or after their monthly EBT payment arrives?

Esso's picture

Does it really matter when your choices are negative and not-quite-as negative?

citizen2084's picture

There is a "not quite as negaitive" ? I missed that choice...



Esso's picture

90% Really Negative Net Worth

5% Negative Net Worth

3.99% Not-Quite-As-Negative Net Worth

1% Rich

.01% Super Ultra Mega Rich. [tax exempt]

Vashta Nerada's picture

It is the logical end game of Keynesian economics. If you don't spend your money to reflate our economy, we'll do it for you - using your money.

Keynsians borrow when they can, but if they can't, well, whose name is on those banknotes anyway?

ACP's picture


(proposed by Trump in 1999)

Element's picture



Still part of the Keynsian program, everything means everything.

“We are looking at what could be a very long siege here,” [he got that right] Krugman said in an interview today in Princeton, New Jersey, with Carol Massar of Bloomberg Television’s “Street Smart.” “We really are at a stage where we should have a kitchen-sink strategy. We should be throwing everything we can get at this.

- Paul Krugman, July 6th 2010

What amazes me is I still see MSM and blog articles that assume you can get a stable long-term recovery from here without most of the existing private and public debt in the world being written-down first. They apparently think that people with debts up to their eyeballs are going to keep paying and borrowing and buying. They don't seem to realize that unless there's exponential debt growth just to pay the ponzi needs of interest owed on older loans, then mass default crisis's are assured to snowball, regardless of ANY other actions or austerity policies undertaken. Until people realize there's no way out via a muddle-through, we're just going to keep seeing deterioration and very dangerous political unrest.

The Tylers could maybe do an article on this reality to make sure people understand that there's a limit, and we are riding along its edge. We are the snails crawling up the edge of a straight razor ... and surviving ... for now.

NoTTD's picture

You moron.  They'll not "steal" it from"citizens".  They'll "tax" it from the "rich".   About 25% of all US citizens have a 401(k) or similar accout.  What better marker for being "rich"?  Easy, peasy, Japanesy.  Literally Japanesy.  

Esso's picture

Don't forget about a federal sales tax and a one-time federal "emergency" property tax on RE, cars or anything else with your name on it. Lotta possibilities now that the rubicon has been crossed. Thank Jeebus that pesky ol' rule-of-law thingy is dead. Nuthin' but blue skies ahead!

auric1234's picture

They will do it when the cost of not doing it would be hyperinflation.

The Fed represents all paper holders. They need to keep the music playing so that people don't realize their paper is worthless. So, once they can't monetize further, nominal confiscation also becomes a possible outcome.


Renfield's picture

I had to read your comment twice to get the implication of this: that hyperinflation could be that close.

Real Estate Geek's picture

Fiat isn't worthless.  If it was, they wouldn't confiscate it.


uh oh . . .

Never One Roach's picture

The pension plans are much juicier...not to mention property taxes...both easy to find and super easy to tax.

Mugatu's picture


There will not be a need for any additional taxes in the US.  Do you really think it is hard to just leave the printing press on for 15 minutes more each day?  Do you think the US government (or any government for that matter) is so honest that they would never lie about how much money is printed or the amount of over-printing done?  How do you think all these black programs get paid for?  

Its just paper dude.  It really isn't worth anything.  If you run out, you just print more.  Germans found that out last Century.

ziggy59's picture

He does, its called Manhattan

kito's picture

flacon, you forget that small business owners need to have money in the bank to take care of overhead, capital expenditures, payroll, etc............small business owners, with all of the challenges in todays environment, shouldnt have to go to bed at night wondering if their hard earned money will be seized the next day.......its sad that this is what the world has come to..........

additionally flacon, there are people that need to save to purchase a home, piece of land, start a business, etc....they need to keep money in the bank to make the purchases.......bringing a suitcase of cash or a bag of gold to the closing on a purchase wont work these the people arent stupid, its the mother f-cking system---where the average guy has to worry about something simple like keeping cash in the bank--that is stupid................

LawsofPhysics's picture

You can thank ZIRP.  Despite all the lies, there is a very real cost for capital and resource mal-investment and mis-allocation.  When banks were simply banks and there was real consequences for bad behavior, this shit happened less.

new game's picture

maybe it is time to go back to the old west

cash at the end of the cattle drive

then to the bars and bitchezzz.

Bad Attitude's picture

It should be obvious by now that Dear Leader and his regime don't understand basic economics, don't give a damn, or both. They don't give a damn about small businesses. When they decide to take our money, they'll just grab it, the consequences be damned.

Forward (and over the cliff)!


vs an army all alone's picture

Almost every small buisness has 6 digit in their acct. at any given time.

What are they going to do flacon?



Boris Alatovkrap's picture

Now, Putin is own Cyprus and all Cypriots.