Dijsselbloem: "Levy On Wealth Is Defendable In Principle"

Tyler Durden's picture




 

While France's Hollande and Spain's Rajoy are double-teaming the 'unique, exceptional' nature of Cyprus, the non-template nature of the 'deal', the need for Europe-wide guarantees, and that the ESM should be used to recap banks and not depositors, none other than Dutch FinMin Dijsselbloem is at it again as he admits what many have suspected:

  • *DIJSSELBLOEM SAYS LEVY ON WEALTH IS DEFENDABLE IN PRINCIPLE

and, as if responding to the desperate French and Spanish leaders:

  • *DIJSSELBLOEM SAYS DEPOSIT GUARANTEE SYSTEMS ARE NATIONAL

It would appear our views are increasing appearing true - that a wealth tax is coming in much more systemic a manner than many expect currently.

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Tue, 03/26/2013 - 15:16 | 3378323 arm50
arm50's picture

no one cares

Tue, 03/26/2013 - 15:20 | 3378357 nope-1004
nope-1004's picture

during initial discussions, but after the confiscation they sure as hell will.

 

Tue, 03/26/2013 - 15:23 | 3378377 persu
persu's picture

I am asking, is't that normal process. There is a guarantee up to 100k and then once capital is gone, doposits are cut?

This is normal? Why such a fuss?

Tue, 03/26/2013 - 15:34 | 3378465 TJ00
TJ00's picture

Because the EU haircut the Greek bonds which the Cypriot banks held, making them insolvent, and now the EU wants savers to pay for the EUs actions. Or to put it another way if I stabbed you and then blackmailed you into giving me all your money to take you to hospital, would that be a good or bad thing?

Tue, 03/26/2013 - 15:38 | 3378487 SMG
SMG's picture

*DIJSSELBLOEM SAYS LEVY ON WEALTH IS DEFENDABLE IN PRINCIPLE

So are public hangings of corrupt public officials and the people who control them.

Tue, 03/26/2013 - 15:54 | 3378580 hedgeless_horseman
hedgeless_horseman's picture

 

 

Thank you for pushing money to the USA and helping us to fund our deficit spending.

 

Tue, 03/26/2013 - 16:11 | 3378630 Manthong
Manthong's picture

LEVY ON WEALTH IS DEFENDABLE IN PRINCIPLE

.. but there is that little detail of PRACTICE.

The little that is left of a western “market” will abandon you in a heartbeat and the BRICs/developing world will reject you even faster.

Tue, 03/26/2013 - 16:15 | 3378701 The Juggernaut
The Juggernaut's picture

Principle of the fucking dark ages.  Kingly like atmosphere do have its healthy Revolutions.

Tue, 03/26/2013 - 16:26 | 3378750 redpill
redpill's picture

This Dieselboom fuck really doesn't know when to shut up, does he.

Tue, 03/26/2013 - 16:31 | 3378772 Deo vindice
Deo vindice's picture

Actually, I'm glad he's talking. It might wake up a few more sleepers into action as it is a revelation of how these bankers really think.

Keep on talking Mr.Dijsselbloem. By speaking the truth you are helping the cause of liberty more than you could possibly know.

Tue, 03/26/2013 - 16:44 | 3378832 Lore
Lore's picture

Okay, then explain why people are piling into the USD, when White House has pushed "TAX THE RICH" for months, and there's talk of nationalizing 401K and IRAs.  Knowing the major economic themes of the next couple decades, wouldn't it make much more sense to buy PMs and maybe hold some Eurasian currencies? Or is that too esoteric for people on the street? Call me dense, but I just don't follow European depositor logic.

Tue, 03/26/2013 - 17:25 | 3379001 Manthong
Manthong's picture

“then explain why people are piling into the USD,”



a. it’s all they  know.. misplaced confidence

b. elements of game theory.. and the algos.

c. see “a” above, the last 40 years of “education” has produced societal livestock (this time is different)..


Tue, 03/26/2013 - 17:34 | 3379020 hapless
hapless's picture

In short, PMs are a great inflation hedge, but only if there is inflation.  Without inflation, PMs suck at just about everything 'cause they are expensive to store in bulk and don't yield anything.  So European depositors are waiting for the first sniff of inflation - then they'll rush to exit currencies like so many Brazilians in a burning nightclub.

Tue, 03/26/2013 - 17:35 | 3379039 akak
akak's picture

When exactly in the last 80 years (USA) or the last 100 years (in Europe) has there NOT been 'inflation', i.e., ongoing currency debasement?  Allow me to answer my own question: NEVER!  So any fool still "waiting for inflation" is not just going to be too late, he is ALREADY too late.

Tue, 03/26/2013 - 20:39 | 3379673 fnord88
fnord88's picture

Geez you idiot. Krugman says today that there is no inflation, never has been and never will be, so you're wrong. He has a shiny nobel prize, so he knows. I have other shiny things, but i'm just a moron shumk. Even Buffett, the smartest investor of all time thinks i'm an idiot for buying shiny yellow metal. Sometimes i wonder why i do so many stupid things all the smartest people tell me not to.....glutton for punishment i guess. Just like you should trust a women that has cheated on you, you should always trust a banking system that has fucked you. To say otherwise makes you a doomer....and maybe a terrorist.

Tue, 03/26/2013 - 16:51 | 3378873 sunnydays
sunnydays's picture

Jim Willie said it is about domination between East and West in an interview about Cyprus

 

http://www.youtube.com/watch?v=P5OBHqQkiAI

Tue, 03/26/2013 - 16:36 | 3378797 Anasteus
Anasteus's picture

Exactly, Dieselboom should first clarify for himself what he actually wants to say. Otherwise, even hens in the yard will be laughing at him.

And I don't want to hear another call from Goldman...

Tue, 03/26/2013 - 16:38 | 3378808 Relentless
Relentless's picture

I had to down vote you - the only people who actually want him to shut up are the lying bar stewards in the rest of the EU. 

 

Moar truthiness!!

 

Oh, and I'm picking DieselBoom for my dead pool entry.

Tue, 03/26/2013 - 16:28 | 3378758 SafelyGraze
SafelyGraze's picture

it would be a lot more fair if, for example, a 10 percent tax or penalty were assessed whenever funds were withdrawn

 

Tue, 03/26/2013 - 16:40 | 3378814 DosZap
DosZap's picture

Safely Graze,

NO, if people follow banking PROTOCALLS,then NO one should be hit,unless they are OVER the insured,guaranteed amount.(and then ONLY when it will save ALL depositors.)

Tue, 03/26/2013 - 16:16 | 3378703 I am more equal...
I am more equal than others's picture

Removing the political and banking class is defenable in principle and practical too. 

No one expects the spanish inquisition.....

Tue, 03/26/2013 - 16:32 | 3378780 SgtSchultz
SgtSchultz's picture

....."Nooobody expects the spanish inquisition"

https://www.youtube.com/watch?v=sAn7baRbhx4

 

 

Tue, 03/26/2013 - 16:44 | 3378825 DosZap
DosZap's picture

As long as the SHEEPLE under the MAX insured rate do not get hit,they will stay asleep.

If they(Cypress) went thru with their 1st proposal, in America there would not be a Bank left in one piece.

Three things you do NOT wanna screw around with.

A Mans family,his money, and his guns................

Tue, 03/26/2013 - 16:14 | 3378697 CheapBastard
CheapBastard's picture

Banks are no longer a safe place to store your money.

 

That's the bottom line. If you don't hold it in your possession, "Poooofff!..." it can be gone in a flash depending on the whims of some bankers & politicians, without warning.

Tue, 03/26/2013 - 16:33 | 3378782 Deo vindice
Deo vindice's picture

Banks have not been a safe place to store money for a very long time. It's just becoming apparent to the masses now.

Tue, 03/26/2013 - 19:10 | 3379341 JeffB
JeffB's picture

This too shall pass.

Tue, 03/26/2013 - 15:55 | 3378585 francis_sawyer
francis_sawyer's picture

In other news... 'Bloomberg' says that telling New Yorkers what to eat, drink, carry, & that it is in their best interest to be spied upon 24/7 is defendable...

Tue, 03/26/2013 - 15:57 | 3378596 azzhatter
azzhatter's picture

Hey, jizzelbomb- using this logic, it is defensible to hang bankers, politicians and eurocrats as well. I am in complete agreement in principle of course

Tue, 03/26/2013 - 16:16 | 3378705 Winston Churchill
Winston Churchill's picture

Just need to sort out the details;hemp or piano wire ?

Tue, 03/26/2013 - 16:23 | 3378731 inevitablecollapse
inevitablecollapse's picture

depends on the desired aesthetic affect i suppose...

Tue, 03/26/2013 - 16:27 | 3378755 ejmoosa
ejmoosa's picture

Got Rope?

Tue, 03/26/2013 - 15:41 | 3378520 persu
persu's picture

But credit risk is normar business. If Greece is insolvent, it is insolvent. It is poor risk management to hold a concentration of almost insolvent sovereign bonds.

Anyone could have predicted Greek insolvency in 2004. Olympics added 5% to GDP, all waste in later useless arenas, all paid by borrowing.

If a bank is stupid enough to buy such debt, it is a failure of governance, risk management and macroprudential oversight. Wealth depositors should pay attention.

It is a real world. Stop whining about conspiracy or similar Alex Jones type of argumentation.

Tue, 03/26/2013 - 15:51 | 3378568 Urban Redneck
Urban Redneck's picture

Then how about the ECB- which itself was dumb enough to accept crap paper as collateral, taking a haircut on the 9B they fronted Laiki, after all it's --

"just credit risk management to hold a concentration of almost insolvent sovereign bonds.  If a bank is stupid enough to be holding such collateral and then pushes its counter-party into bankruptcy, it is a failure of governance, risk management and macroprudential oversight." (among other things)

Tue, 03/26/2013 - 16:20 | 3378727 TBT or not TBT
TBT or not TBT's picture

The demographics of Greece is the main cause of their decline. They didn't have enough kids to sustain their civilization, nevermind their welfare state, pensions and so on. The stupidity of the euro allowed this demographically doomed historically risky country to borrow lots of money for awhile at low spreads to far less risky borrowers in formerly prudent low risk places like Germany. The decline was coming anyway for Greece, baked into their distribution of age and super low birth rates. They just got to party hearty for a few years here. No recovery is possible there. They face civilisational collapse.

Tue, 03/26/2013 - 16:31 | 3378769 Debugas
Debugas's picture

demographics is not the root cause. people cant afford having babies anymore because they have no stable source of income

Wed, 03/27/2013 - 02:12 | 3380305 edotabin
edotabin's picture

Regardless of cause and effect, it is a death spiral

Tue, 03/26/2013 - 16:36 | 3378795 TJ00
TJ00's picture

1. Sovereign Bonds are Tier 1 capital and are held without any reserves against them as per Basel, as Sovereigns in the EU can be blackmailed into taking on private debits to other sovereigns, like they did with Ireland who are paying Germans back for their failed banks, no sovereign is safe, except Germany.

2. The EU had been saying they would save Greece up until the bond haircuts remember debt baybacks, rollovers and swaps? Yep The EU lied about private creditors to Greece being screwed while at the same time keeping the EBC / IMF whole.

 

To conclude, holding Greek bonds wasn't stupid if you believed the people in charge, we (the ZH community, a few notable bloggers and occasional reporter) are the few that are willing to doubt the lies of the politicians and bureaucrats and poke holes in there arguments, but most people, maybe 99%+, are neither intelligent nor inquisitive enough to be like us.

 

Tue, 03/26/2013 - 19:23 | 3379387 JeffB
JeffB's picture

That's true to a great extent. On the other hand, it was the central governments and their central bankers that flooded the world economy with cash blowing an enormous worldwide financial bubble. That cash had to be spent or invested elsewhere and the normal economic indicators and checks and balances were thrown completely out of whack.

Prices on stocks, bonds & commodities were greatly inflated based on artificially low interest rates and a lot of hot cash. The economy was booming far beyond what was reasonable and supported by the underlying economic reality.

Those bankers obviously made some bad decisions, particularly in retrospect, but there was a reason so many other bankers (& rating agencies) were making such disasterous decisions at the same time as well. It was not some ginormous coincidence.

See Prof.  Roger Garrison's Youtube talk on the ever prescient Austrian Theory of the Trade Cycle.

 

Tue, 03/26/2013 - 15:42 | 3378498 earleflorida
earleflorida's picture

the financial catalyst for any sovereignty is not the poor, nor the uber wealthy, but rather the middle class that fuels the engine of growth

Tue, 03/26/2013 - 15:40 | 3378512 TeamDepends
TeamDepends's picture

Doposits guaranteed in the Amsterdam  Sinsi Bank oh man that was good stuff.  What?

Tue, 03/26/2013 - 15:52 | 3378570 Ineverslice
Ineverslice's picture

 

We are gonna die...

Otter, we're the only white people in here.

Tue, 03/26/2013 - 16:11 | 3378680 TeamDepends
TeamDepends's picture

I won't go schizo, will I?

There's a distinct possibility.

Tue, 03/26/2013 - 16:47 | 3378856 SgtSchultz
SgtSchultz's picture

Hey Flounder, you can't spend your whole life worrying about your mistakes, you fucked up, you trusted us.

Tue, 03/26/2013 - 16:27 | 3378752 Debugas
Debugas's picture

ECB being a bondholder of Laiki bank saved its 9bn euros by transfering to the "good" part whereas Laiki depositors got shaved

Tue, 03/26/2013 - 17:01 | 3378902 ootofthehoos
ootofthehoos's picture

The normal process is bankruptcy court to dispose of the bond and shareholder capital first, not attack deposits first. The bank can continue to operate under government control, if it is caught by regulators before all the capital is gone and then the bank is liquidated or recapitalized and uninsured deposits might take a loss.

All of these current procedures are abnormal because the entire banking system is a festering wound operating without rules, and instead arbitrary authoritarians make it up as they go.

 

Tue, 03/26/2013 - 17:46 | 3379063 OccupyTVstations
OccupyTVstations's picture

Now it's 80%, Bitchez!

Cyprus Finance Minister Michael Sarris has said uninsured Laika depositors could face an 80pc haircut, and might have to wait up to seven years for a payout.

@ 21:19

http://www.telegraph.co.uk/finance/debt-crisis-live/9953844/Cyprus-bailo...

lol- they must testing to see how far they can go before the people get serious about gallows, guillotines, et al

Tue, 03/26/2013 - 15:24 | 3378379 kaiserhoff
kaiserhoff's picture

And still not a word about derivatives, or what that tsunami will do to them.

They really are clueless.  Ben must be shitting razor blades.

Tue, 03/26/2013 - 15:37 | 3378483 Ruffcut
Ruffcut's picture

They ain't clueless, they don't care about derivatives only on small players they kill off. It is about owning ALL OF IT.

So far, so good.

Tue, 03/26/2013 - 16:31 | 3378771 jus_lite_reading
jus_lite_reading's picture

Answer: $380 BILLION per month in total QE. That official $85B/month is window dressing as the real figure is OVER $380B and accelerating, and they can't answer to anyone because it is a "nati0na| s3cuirty risk"... as in, if the truth was told, the whole house collapses.

You do the math. They need to keep the facade together for 197 YEARS AT THAT RATE of $380B/month just to fund the next 20 years of total debt! Let that sink in. The numbers are astounding. In short, it's a mathematical certainty the global ponzi will fail within the next 12 months, and by fail it means one of two things- hyperinflation or total collapse and BOTH of these situations lead to the war Albert Einstein talked about...  

Tue, 03/26/2013 - 17:13 | 3378964 dicktator
dicktator's picture

We are all ponzians now, as The classic guru would say today. So, buy physical bitcoins!

Do NOT follow this link or you will be banned from the site!