Brave New World of Bank Bail-Ins As Of January 1st
Brave New World of Bank Bail-Ins As Of January 1st
On January 1st, 2016, the new bail-in regime became law putting at risk the deposits of savers and companies in the EU.
EU countries join the UK, the U.S., Canada, Australia and New Zealand in having plans for bail-ins in the event of banks and other large financial institutions getting into difficulty. It is now the case that in the event of bank failure, personal andcorporate deposits could be confiscated.
The bail-in architecture was seen in the Cyprus bank bail-ins that were seen in 2013. Then, deposits of over €100,000 were confiscated in “haircuts” in order to bail out banks in Cyprus. Now the exact same principles that were used in Cyprus – which we were told was unique and a one off – are going to apply to all of Europe.
Bail-ins and the risks they pose have largely been ignored in most of the media. In one of the very few articles on bail-ins in recent days, Hugh Dixon of Reuters Breaking Views has looked at bail-ins but has focused on the “political risks” rather than that posed to savers and indeed company depositors:
The European Union entered a brave new world of bank “bail-ins” at the start of 2016. Europe has wasted so much taxpayers’ money on bailing out bust banks in recent years that it is right to try to get investors to help foot the bills in future. However, the tough new regime carries big political risks.
The article, ‘EU enters brave new world of bank bail-ins’, is interesting despite ignoring the financial and economic risk of bail-ins – they would likely be very deflationary in a world already beset by deflation – and can be accessed here
Download Our Must Read Bail-In Guides Here:
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From Bail-Outs To Bail-Ins: Risks and Ramifications
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what happens to bank customers with a mortgage in a bail in? i realise those with deposits will lose them, will banks with derivative exposures be taken over eg Lehmans? if so, who will do so?
Anyone know the answer: if I have a brokerage account, and the brokerage uses Citi as custodian, is my claim to my cash at Citi senior to regular old Citi deposit accounts?
stack.... & keep your account around £1 or $1, the banks hate that, mine certainly does anyhow. The look on their faces when i tell them about the coming banking collapse & "surely you must know you work in a bank line"
Then explain the difference between Phyz & paper price & the LBMA / Crimex fraud....
watching them start fidgeting, swallowng and continually adjusting the seating position (not like that) is sad really for obv reasons.
bro - while i totally respect the content of what you're saying, i think they're fidgeting because they think you're a loon... not because of how cogent and analytically precise your arguments are. at least if you're trying to have these conversations with the bank tellers or other low-level peeps.
“I’m worried about retirement investments, not bail ins…”
Sorry, but it’s already happened.
I think most American tax payers, active and retired, would be something short of shocked to learn how state and federal bureaucrats have enriched themselves at the expense of American serfs.
There are three major Retirement Systems (RS) managed by American governments: one for privately-employed workers (Social Security); one for State workers and one for federal workers.
When we compare the three, using EQUAL EARNINGS HISTORIES for each category – we find that retirement checks amount to $1500 for privately-employed; $7,950 for state-employed (California); and, $4,500 to $5,200 for federal-employed. Of course, the privately-employed, as taxpayer, ultimately pays for everything.
It is actually much worse than indicated by these numbers.
It raises the question, ‘Is social Security Shortchanging Taxpayers?’
speaking of TAX, they are blaming APPLE for not paying enough tax. Now they are making them pay by kicking them in the balls.
SEE THE CHART HERE ==> http://www.bit.ly/1B4K0wk
Apple Down -2% today. I see lots of analysts saying to BUY APPLE, but if you see that chart, its no where near a buy signal. Went down 2% today. OUCHIE!!
Something is a bit iffy with this one. maybe its the powers that be, trying to play their hand, and have some fun before the BIG CRASH comes.
I find it funny they play the movie, the BIG SHORT this week, when the market is looking bad. Hmmmmm. Coin-ky-dink or what!???
the question that i have that no one seems to be able to answer is this: what about credit unions? they have exposure to derivatives...so do they have exposure to bail-ins? i'm guessing yes, but i don't know.
Credit unions vary a lot in how they are managed, there is a decent rating website for them, I think you can find it on Bankrate.com Also credit unions do have an insurance system and I'm guessing it's more solvent than FDIC.
I'm not that worried about banks, I don't have a ton of money there. I'm more worried about retirement investment bail-Ins.
They already have structured gates for MFs. The 10 day rule is pure garbage. That gives them plenty of time to call a force majeure and exrtend the gates indefinitley, thus locking up your funds in those accounts. Everybody should have a minimum of six months living expenses in liquid assets outside the banking system.
"six months living expenses in liquid assets outside the banking system." --
The ability to hunt, kill, and butcher mammals and game birds counts right?
Like you, I don't think people fully grasp the scale of the paper promises that have been "created" out of nothing. These paper/digital claims will start seeking out real assets eventually...
Yup, hunting and fishing count as living expenses, butt, you definitely want to have an amount of cash to take care of the "absolute" necessities. You will need fuel, and maybe some bribes. Plus if you get invaded, it's better to lose some cash than it is to lose your PMs...
;-)
I'm still at a loss here trying to find the scary boogeyman that they portray the "Bank Bail-Ins" as. Here in the U.S., we've always known that any deposits exceeding the FDIC/FSLIC/NCUSIF limits would be lost in a bank failure. What am I missing?
Now, I'm also aware of the near insolvency of those insuring institutions. I just don't keep enough in the banks to exceed what they can pay out.
In the "good old days", shareholders would be tapped to make up any losses when a bank failed. It didn't take long for that rule to change once banks started going under in the 30's. Once investors realized that they could lose MORE than they bought-in at, they stopped buying bank shares. Same thing goes for FDIC coverage. If it proves to be a farce, how long before the bank runs begin?
Uh, the banker brokers have purchased your government, FDIC has like 6B to cover 12,000 B
You don't see that the game has changed?
They don't give a shit about bank runs when they can just take your money out of the gate....what is there to run?
"FDIC has like 6B to cover 12,000 B
You don't see that the game has changed? "
That's my point exactly. They cannot let the commoner see that the king has no clothes. The banks need us to not be able to see behind the curtain. If everyone distrusted the banks, who would keep money in their bank accounts? Right, no one. So, when everyone distrusts the banks and starts dealing in cash/barter, how will they then be able to control and monitor the masses? They need us to believe the illusion and continue using traceable purchasing methods. How else will they know where we spend our money (guns, ammo, preps, subversive literature, conservative causes, etc.)?
Remember, money creation (something intimately associated with banking) use to require real collateral creation. The only real work a banker had to do was to protect people's real assets and the money they deposited. This was done by doing due diligence and having enough profittable loans to offset interest on deposits and bad loans. A central bank or government treasury has always printed money for the banks, but they also use to let the poorly managed fuckers die and money creation did require more PMs (real collateral), even with the fractional reserve system. This changed in 1971 when the final connection between banking and reality was broken. 2001 was essentiall a bank/equitie run that resulted in switching from "mark to market" to "mark to fantasy". Contract law regarding property titles was all undone allows for the creation of even more theft/fraud via mortgage-backed securities. despite all this legilsation in favor of more banker/financier fraud, the liabilities of the U.S. government and the collase of housing resulted in another bank run and government paper crisis in 2008.
Botom line; In terms of real collateral all the fucking banks are zombies already and the bank run is ongoing.
eventually the quadrillion+ (you must count derivatives and all other bets/I.O.U.s) in paper claims that have been created will in fact start seeking out real assets that simply do not exist.
hedge accordingly.
"A central bank or government treasury has always printed money for the banks, but they also use to let the poorly managed fuckers die"
Exactly. But, the dead banks caused consternation among the citizens who then refused to use their services. They don't want that now - they need us to believe in the sanctity of the banking industry and funnel all of our money through them for tracking purposes.
Banks, all the empathy of a two year old dropping a cookie.
"Cyprus bank bail-ins that were seen in 2003."
Umm, I think you're about a decade too early for that. Seems it was 2013/14.
"Umm, I think you're about a decade too early for that."
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What if they had a secret one you didn't know about?
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