Europe Brings Out The "Capital Controls" Bazooka

Tyler Durden's picture




 

Here we go:

  • EU SOURCES HAVE DISCUSSED IMPOSING CAPITAL CONTROLS AS WORST CASE SCENARIO IF GREECE LEAVES EUROZONE - RTRS
  • IMPOSING BORDER CHECKS, LIMITING ATM WITHDRAWALS ALSO PART OF WORST-CASE SCENARIO PLANNING - EU SOURCES - RTRS
  • SUSPENSION OF SCHENGEN ALSO DISCUSSED

In other words, that money you thought you had... You don't really have it. We can only hope this message was not meant to restore confidence and prevent future bank runs. Because if Europe wanted a continental bank run, it may have just gotten one.

This is getting scary very fast.

Full piece from Reuters:

European finance officials have discussed as a worst-case scenario limiting the size of withdrawals from ATM machines, imposing border checks and introducing capital controls in at least Greece should Athens decide to leave the euro.

EU officials have told Reuters the ideas are part of a range of contingency plans. They emphasised that the discussions were merely about being prepared for any eventuality rather than planning for something they expect to happen - no one Reuters has spoken to expects Greece to leave the single currency area.

Belgium's finance minister, Steve Vanackere, said at the end of May that it was a basic function of each euro zone member state to be prepared for problems. These discussions appear to be in that vein.

But with increased political uncertainty in Greece following the inconclusive election on May 6 and ahead of a second election on June 17, there is now an increased need to have contingencies in place, the EU sources said.

The discussions have taken place in conference calls over the past six weeks, as concerns have grown that a radical-left coalition, SYRIZA, may win the second election, increasing the risk that Greece could renege on its EU/IMF bailout and therefore move closer to abandoning the currency.

No decisions have been taken on the calls, but members of the Eurogroup Working Group, which consists of euro zone deputy finance ministers and heads of treasury departments, have discussed the options in some detail, the sources said.

As well as limiting cash withdrawals and imposing capital controls, they have discussed the possibility of suspending the Schengen agreement, which allows for visa-free travel among 26 countries, including most of the European Union.

"Contingency planning is underway for a scenario under which Greece leaves," one of the sources, who has been involved in the conference calls, said. "Limited cash withdrawals from ATMs and limited movement of capital have been considered and analysed."

Another source confirmed the discussions, including that the suspension of Schengen was among the options raised.

"These are not political discussions, these are discussions among finance experts who need to be prepared for any eventuality," the second source said. "It is sensible planning, that is all, planning for the worst-case scenario."

The first official said it was still being examined whether there was a legal basis for such extreme measures.

"The Bank of Greece is not aware of any such plans," a central bank spokesman in Athens told Reuters when asked about the sources' comments.

The vast majority of Greeks - some surveys have indicated 75 to 80 percent - like the euro and want to retain the currency, something Greek politicians are aware of and which may dissuade them from pushing the country too close to the brink.

However, SYRIZA is expected to win or come a strong second on June 17. Alexis Tsipras, the party's 37-year-old leader, has said he plans to tear up or heavily renegotiate the 130-billion-euro bailout agreed with the EU and IMF. The EU and IMF have said they are not prepared to renegotiate.

If those differences cannot be resolved, the threat of the country leaving or being forced out of the euro will remain, and hence the need for contingencies to be in place.

Switzerland said last month it was considering introducing capital controls if the euro falls apart.

In a conference call on May 21, the Eurogroup Working Group told euro zone member states that they should each have a plan in place if Greece were to leave the currency.

Belgium's Vanackere said two days after that call that it was a basic function of each euro zone member state to be prepared for any eventuality.

"All the contingency plans (for Greece) come back to the same thing: to be responsible as a government is to foresee even what you hope to avoid," he told reporters.

"We must insist on efforts to avoid an exit scenario but that doesn't mean we are not preparing for eventualities.

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Mon, 06/11/2012 - 12:11 | 2515009 Pairadimes
Pairadimes's picture

Ha Ha. Poster child for the contraception lobby...

Mon, 06/11/2012 - 12:17 | 2515030 resurger
resurger's picture

Sir,

Define "Terrorism"?

 

Mon, 06/11/2012 - 12:45 | 2515141 lolmao500
lolmao500's picture

Being anti-TSA, anti-DHS etc. was cool for a while, but now it's just getting lame.

Being pro-freedom is lame?? So... why don't you move to your paradise, North Korea?

Mon, 06/11/2012 - 11:45 | 2514850 monkeyboy
monkeyboy's picture

This is Bullish right?!

Mon, 06/11/2012 - 11:58 | 2514925 BalanceOrBust
BalanceOrBust's picture

Don't worry my Grecian friends.  Your euros will be lost, but the Government has a plan to replace them with tungsten.  Oh wait, that was another plan.

Mon, 06/11/2012 - 12:04 | 2514963 agent default
agent default's picture

No way.  Tungsten is a hard asset.

Mon, 06/11/2012 - 12:54 | 2515190 brooklynlou
brooklynlou's picture

Its bullish as long as the oompapa band doesn't stop playing. After that its Bearish till they stop shooting at each other. Then its bullish again ...

Mon, 06/11/2012 - 11:57 | 2514889 krispkritter
krispkritter's picture

If an economy falls in the forest and noone is around to hear it because they're all in line at ATM's, does anybody hear the implosion?

http://www.ladyofthecake.com/mel/world/sounds/youcare.wav

 

Mon, 06/11/2012 - 12:51 | 2515171 JohnKozac
JohnKozac's picture

Fast Forrest, run....

 

http://www.youtube.com/watch?v=5R_HIcE_TIE

"Come back here, you!"

Mon, 06/11/2012 - 11:38 | 2514799 CClarity
CClarity's picture

Bizarrely, so fiat is fleeing TO the ruble and Russia from periphery.  Meanwhile, megabillionaire Russians continue to buy the Med. periphery coastline.  Turkey to Greece, Montenegro to Iberia.  Lots of islands and yachts between.

Mon, 06/11/2012 - 11:47 | 2514860 Chief KnocAHoma
Chief KnocAHoma's picture

Just last month our start up company launched an exciting new product to raging success. We are now the World's best guillotine manufacturing company. Demand for our product has been extremely high and largely well received except for one product defect.

Our original model was intended to kill bankers slowly, with a great deal of pain. The jagged edge blade was intended to only partially cut off the offender's head on the initial drop. This feature was intended to allow the executioner the opportunity to retract the blade, leaving the offender writhing and wailing in pain.

Unfortunately, there have been reports of our product lopping off skulls on the first drop, thus leaving crowds disappointed. These mobs want a justice equal to the pain they have suffered, not quick painless retribution. For this defect our company offers a sincere apology.

We recommend, in the future, switch men drop the blade from lower heights, or simply email us and we will send you free of charge two rusty and dull axes which can be used to remove the feet of your scumbag banker right before the crowd drags him to the stage.

And again, thank you for your business.

Chief.

http://annoyanidiot.blogspot.com/

Mon, 06/11/2012 - 11:59 | 2514929 j.tennquist
j.tennquist's picture

Yes, yes... bankers,  but what about the lawyers and politicians?  

Remember you have to remove every trace of the virus in order to be cured.

 

Mon, 06/11/2012 - 12:09 | 2514989 Chief KnocAHoma
Chief KnocAHoma's picture

Our attorney recommended that we should not market this product for that use.

Mon, 06/11/2012 - 12:43 | 2515132 Harbanger
Harbanger's picture

It all began with a complicit MSM.

Mon, 06/11/2012 - 14:29 | 2515522 Calmyourself
Calmyourself's picture

This entire ponzi would never have achieved liftoff or escape velocity without a complicit MSM, now that apogee has been reached and the ponzi is flaming back to Earth, Never forget the MSM and it's pivotal role..  Save some room on the stage Chief knocAhoma...

Mon, 06/11/2012 - 14:42 | 2515028 Temporalist
Temporalist's picture

Aww come now, banksters are suffering too as Blmbrg reports:

 

Greece Threatens Wall Street Jobs in Third Trading Plunge

"Wall Street bankers and traders, given hope by a market rebound in the first quarter, are now seeing earnings and paychecks threatened by turmoil in Greece in what is becoming an annual cycle."

http://www.bloomberg.com/news/2012-06-11/greece-threatens-wall-street-jo...

Mon, 06/11/2012 - 11:35 | 2514774 Bazinga
Bazinga's picture

Who, me run? Hold on...too busy grazing.

Mon, 06/11/2012 - 11:37 | 2514796 Broomer
Broomer's picture

I was thinking of Run Lola Run:

"A young woman in Germany has twenty minutes to find and bring 100,000 Deutschmarks to her boyfriend before he robs a supermarket."

Mon, 06/11/2012 - 11:48 | 2514864 Gully Foyle
Gully Foyle's picture

Broomer

Not in the same spirit.

Great movie though.

Mon, 06/11/2012 - 13:16 | 2515249 brooklynlou
brooklynlou's picture

The Greek version wil be called "Run, Mr. Panos Run"

A flip-flop wearing overweight Greek man in shorts and a wife beater has one business day to run around Athens and get 100,000 euros out of his news-ignoring Grandmothers various bank accounts before the country goes bust. Sort of like the Balkan version of the Blues Brothers meets Run Lola Run ...

Things to expect in the movie ...

  • Mr. Panos smacking his cousin the taxi driver over the head with his flip-flop of death so that the driver can go faster.
  • Multiple and amusing uses of the word "Yeenius"
  • He will be chased around Athens by members of the neo-Nazi Golden Dawn party (Piraeus Nazis? I hate Piraeus Nazi's!)
  • Anarchist street protestors tossing Fages at everyone
  • A final showdown in front of the Athens branch of deutsche bank with the evil "Herr Schnitzel Monkey"

The movie will have a bitter sweet ending. After Mr. Panos gets all the money out, German capital controls kick in and he can only exchange the money for Drachmas. So next day he's back at the bank depositing the money again.

Mon, 06/11/2012 - 14:15 | 2515469 Matt
Matt's picture

Get Mr Panos to start a kickstarter for it and I'll donate.

Mon, 06/11/2012 - 15:29 | 2515732 Non Passaran
Non Passaran's picture

+1!

That's a good one!

Shit, one business day is too tight. Give the man a week!

Mon, 06/11/2012 - 11:40 | 2514816 FL_Conservative
FL_Conservative's picture

Talk about going full retard!

Mon, 06/11/2012 - 11:55 | 2514901 kito
kito's picture

what is full retard is their willingness to speak the truth. i thought they were supposed to deny/ lie? what happened to "if greece leaves, it will be nothing more than a blip on our screen" kind of statements?

i feel like a tracker who has lost the ability to follow animal prints.........how are we to know they are one step away from doing what they normally state they arent going to do when in fact they are admitting they will do it?

 

Mon, 06/11/2012 - 11:45 | 2514849 Gully Foyle
Gully Foyle's picture

Family member received a call from the bank today. Bank says there is a federal law limiting how often you can pull money from a savings account. All she was doing was moving it to checking when she needed to, maybe a couple of times a week. Both accounts in the same bank.

First it was the amount you could pull daily, now it is the number of times you can pull your money out.

When did this shit happen in the US?

 

 

Mon, 06/11/2012 - 11:58 | 2514918 kito
kito's picture

that banking law has been there a long time. it means that you have a limited amount of transfer transactions per month going from the money market savings to checking, after that you are penalized, but you can still do it. sorry, that is not anything new, and is not indicative of the coming armageddon.....

Mon, 06/11/2012 - 12:38 | 2515121 Ghordius
Ghordius's picture

in many countries the amount that you might draw makes the difference between a checking account and a saving account, the latter giving you more % because it's lent to others on a longer term basis

Mon, 06/11/2012 - 11:58 | 2514922 edotabin
edotabin's picture

IF the account she was moving money out of was a money market account, then, it has aslways been that way. I think it is 3 or 6 transactions per month.

Mon, 06/11/2012 - 12:21 | 2515056 Gully Foyle
Gully Foyle's picture

edotabin

Regular savings.


Mon, 06/11/2012 - 12:43 | 2515136 Ghordius
Ghordius's picture

careful, often you don't have dollars on a money market account. you have "dollar equivalents". because in reality it's EURos!

check the small print and search for the word "dollar equivalents"

buhahahahaha!!!

Mon, 06/11/2012 - 12:04 | 2514950 LaLiLuLeLo
LaLiLuLeLo's picture

Like someone said below. All your fiat are belong to us.

Unless you have it in front of you, IT AIN'T REALLY YOURS!
Mon, 06/11/2012 - 16:39 | 2515951 WillyGroper
WillyGroper's picture

I would question receiving a call. Went to my CU because of this today, had no issues with number of transactions or the amt w/d.

Mon, 06/11/2012 - 11:47 | 2514854 stocktivity
stocktivity's picture

"no one Reuters has spoken to expects Greece to leave the single currency area."

Ha ha....as if they would admit it.

 

Mon, 06/11/2012 - 11:54 | 2514878 Hansel
Hansel's picture

Are you guys compensating Reuters in some way for this story?  If not, way to steal an entire Reuters story which they ran as an "Exclusive" without even providing a link.  And you guys bitch when people recommend using an adblocker...

http://www.reuters.com/article/2012/06/11/us-eurozone-greece-capital-idU...

Mon, 06/11/2012 - 12:09 | 2514994 Alea Iactaest
Alea Iactaest's picture

There's an embedded link in the word "Reuters". Maybe you missed that?

Mon, 06/11/2012 - 12:31 | 2515091 Hansel
Hansel's picture

It wasn't there when they first published, genius.  And it still doesn't make up for copying the entire article.

Mon, 06/11/2012 - 17:00 | 2516019 mkkby
mkkby's picture

Question - Do you expect Greece to leave the Euro?

Answer - No.

Okay thanks, we won't talk to you.

Mon, 06/11/2012 - 11:34 | 2514769 francis_sawyer
francis_sawyer's picture

all your fiats are belong to us...

Mon, 06/11/2012 - 11:35 | 2514782 Sandmann
Sandmann's picture

Don't count on holding gold when men with guns want it

Mon, 06/11/2012 - 11:41 | 2514823 fuu
fuu's picture

I wonder how many gold holders also hold guns.

Mon, 06/11/2012 - 11:46 | 2514853 Gully Foyle
Gully Foyle's picture

fuu

Doesn't matter against a drone or SWAT team.

Like water pistols aganist tanks.

Mon, 06/11/2012 - 11:59 | 2514931 Captain Benny
Captain Benny's picture

I guess you need to buy larger guns...

Mon, 06/11/2012 - 12:10 | 2515003 Alea Iactaest
Alea Iactaest's picture

Anybody thinking they will stand up to a tactical team either needs to reassess the situation or admit they have a death wish.

Mon, 06/11/2012 - 12:27 | 2515078 SubjectivObject
SubjectivObject's picture

Death wish, yeah; it's called war. 

Apparently you can't justify participating in that yet.

Mon, 06/11/2012 - 12:27 | 2515080 DCFusor
DCFusor's picture

Was the victim of a tac team no knock myself (oops, wasn't doing what they were supposedly there for), and yeah, I have plenty of guns.  You go limp instantly or you're dead before you can even draw one, much less go get one out of the case.  That's the reality.

Mon, 06/11/2012 - 12:29 | 2515089 Paul Atreides
Paul Atreides's picture

There's that scare tactic again, bury or sink the stuff and they can never find it. As I have said before nobody was charged or arrested under executive order #6102 it is just a scare tactic for morons to hand over their gold willingly. They don't have the resources to go door to door with swat teams looking for gold. This fear mongering should be called for what it is and squashed.

Mon, 06/11/2012 - 13:39 | 2515355 Cthonic
Cthonic's picture

6102 was used to remove gold coinage and gold certificates (the existing 'dollar') from mass circulation and was followed up by the gold reserve act which also voided contractual gold clauses.  If you had gold, there was no way to lawfully transact in it for over forty years (outside of use for 'artistic purposes').  If you had gold certificates and turned them in, you took a haircut in purchasing power.  Gold certificates became legal to own again in 1964 (though non-redeemable) and if in good condition today can fetch many multiples of the face value as collectibles.

Mon, 06/11/2012 - 14:30 | 2515533 Meatier Shower
Meatier Shower's picture

SWAT team members have families too.

Mon, 06/11/2012 - 12:57 | 2515212 knightowl77
knightowl77's picture

More bullets too and make some molotovs....

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