Cyprus raids banks accounts

[Intrinsic_Value]

Trying to crack down on money laundering by taxing the general population is not justifiable at all. No way in hell. It is stealing and should be declared unconstitutional.

its got nothing to do with a 'tax'. Dont let the media 'white wash' distort the underlying facts.

Bank deposits are supposed to be 'guaranteed'. It forms the basis of our banking system.
Low risk, low return, but 'guranteed' return of capital (especially if under the limit).

There were a bunch of 'rules' that was established during the great depression, because of this very necessary requirement.

But we always forget the lessions of our elders, and are destined to repeat the mistakes again.

Cycles within cycles.

If they wanted a 'tax' there are otherways to do it, but you cant change the basic rule book. If you change the rule book as you go, then people wont trust the rules.

This has set a very bad precident. A precident that has been in place for the last 80 years, and again its comming from the euro masters, not an isolated country.

You very really see me rant on somersoft, but this is dangerous.

BE WARNED.

(However i wouldnt be worried about Australian banks, and Australian deposits)

 

[joeExpat]

So far fingers crossed no bank runs have been triggered in any of the GIIPS countries. Nevertheless I try to keep less than 10K Euro in my Spanish bank account. Obviously the 100K deposit guarantee in Europe is now worthless.

Cyprus still seem to be playing with the percentages to be stolen, now possibly 3% under 100K and 15% over. At one point they were considering 30% confiscation over 100K, outrageous.

 

[hobo-jo]

This has set a very bad precident. A precident that has been in place for the last 80 years, and again its comming from the euro masters, not an isolated country.

(However i wouldnt be worried about Australian banks, and Australian deposits)

On a much smaller scale (0.6%) it happened in Italy (1992).

And agree, unlikely to happen in Australia, we can print our own money so any bank bailouts can happen behind the scenes (but with same net effect, reduction in value of savings except via inflation).

 

[cimbom]

I bet the north of the country are now happy that the south voted against them joining the EU together in the referendum some years ago

 

[kathryn d]

This is very worrysome.
Markets are not reacting much at this point, so i guess the underlying trading feeling is over-riding it.

But to me this is a very very big concern, given its dictated by the euro ministers and not some isolated country event (with its own currency).

Bank deposits (especially under the agreed limit) are sacrosant.
But the rules are being changed as the game progresses.

Gold reacting a bit, but silver is not. This is telling me that at least in the short term, the market is looking for excuses to 'buy the dip' in equities.

Wheather this will last i dont know.

But my warning attena's are beeping like mad.

This is only cyprus, but given that this has been done once bythe euro, we no know that if things get really bad in the future, they could do this to the other periphial euro countries, and if this happens, it will be really really bad.

They are breaking a basic rule book, a rule that has not been broken since the great depression.

It's coming..the Next Great Depression.
There are also lots of cities in USA that have declared bankruptcy.
Start building your food pantry for lean times.

 

[Crabnet]

sure thing!

then we can offer tax deductions when they fail, too?

double edged sword, my friend.

Well, the idea is to tax capital inflows, not profits.
http://www.henrythornton.com/article.asp?article_id=6516

What is needed is all capital inflow be taxed once as it comes in, not after deep diligence by officials with politically imposed ideas about which inflow is good and which is bad.

Prime Minister John Howard famously said that ‘we will decide who comes to this country and the circumstances in which they come,’ and this is now a clear and politically bipartisan policy. It is equally clear that we have the right to discourage the excess capital that is creating a high exchange rate and consequent excess pressure on many Australian industries. This is the best way to resolve the current dilemma for monetary policy. The problem of uncompetitive industry cannot be solved by monetary policy in its current setting.

Our floating exchange rate with an independent, inflation fighting central bank has generally served Australia well, supported by helpful international conditions. The policy now needs the support of a direct, non-discriminatory control over capital inflow. If not resolved, this problem with cause great damage to Australian industry, as it did in the late eighties, when the correct conclusions were not drawn. A similar problem helped lead America, and then the world, into a Great Depression

its got nothing to do with a 'tax'. Dont let the media 'white wash' distort the underlying facts.

Bank deposits are supposed to be 'guaranteed'. It forms the basis of our banking system.
Low risk, low return, but 'guranteed' return of capital (especially if under the limit).



If they wanted a 'tax' there are otherways to do it, but you cant change the basic rule book. If you change the rule book as you go, then people wont trust the rules.

This has set a very bad precident. A precident that has been in place for the last 80 years, and again its comming from the euro masters, not an isolated country.

What do you propose then?
The Cypriot banks passed money to Greece and lost that money. Bonds are maturing and they have no money to pay. The Government doesn't have the money to honour the Bank Guarantee. Where or how do you propose they get the money to honour their debts?

 

[Peter 14.7]

It's coming..the Next Great Depression.
There are also lots of cities in USA that have declared bankruptcy.
Start building your food pantry for lean times.

Yes, it very worrying. It is one thing to tax the people for the banks woes. It is another to take their money.

Being young I never really understood my 1930's born father in law having gold, opals, and lots of cash in the house, until now and when I watched the Movie "Cinderella Man". One scene has Russell Crowe's main character (who lost his life's earning when the banks collapsed in 1930) tell his kids, when he was refuses to eat any off the meagre food they have, because after being at a restaurant ( begging ) he was so full just from seeing it he could not eat anything. It was heart breaking and scary as.

Yet, no one, it seems it going to jail.

Regards Peter 14.7

 

[twobobsworth]

It's coming..the Next Great Depression.
There are also lots of cities in USA that have declared bankruptcy.
Start building your food pantry for lean times.

Most off my US suppliers are saying the last 6 months have been their best in years. Only anecdotal.

 

[kathryn d]

Most off my US suppliers are saying the last 6 months have been their best in years. Only anecdotal.

As with anything, it will depend on the suppliers and businesses.

The saying goes , the bubble is at its largest, just before it bursts.
I hope it's wrong.

 

[willair]

Just goes to show that any government can do what ever they want and also paper money can also be cancelled at any time,i don't think it's much to worry about if Gold was going gangbusters then it may be different..imho..

 

[HiEquity]

From little things big things grow...

I agree this is an absolutely terrible precedent for the EU. Devaluation through inflation is one thing - the "hidden" confiscation of money to monetise debt. But this is something else - bank deposits are the very foundation of the system, upon which everything else is built. This is a precedent that rips at the very heart of the financial system - it can't be without consequence. How many bank holidays can they unilaterally declare in Cyprus to prevent people getting access to their own money?

Personally, I feel the best course of action in response to something like this is to....


... buy property!

 

[Ekaye79]

Let's say Chicken Little is right and everything started tanking (and paper money can be cancelled), where would be the best place to put your money that you have in the bank to ride it out? Property?, gold?, ??? I know property prices can crash, but at least you have a physical asset that can recover at some point down the track (hopefully before one dies ).
What did the lucky/astute ones do during the great depression who managed to get by unscathed?

 

[moyjos]

Did you see this on the news.?

http://money.cnn.com/2013/03/19/news/cyprus-uk-cash/index.html

The UK is flying heaps of cash to Cyprus to pay their troops if they get caught short. Certainly is a sad state of affairs.

 

[Angel]

My husband's grandparents owned land and lots of it. He was a chicken farmer. He bought up more land that the council repossessed for non-payment of the rates. He owned a truck and a bulldozer so he was able to get work from the council and the army and his family rode out the Depression that way. They grew vegies etc and ate from their farm.

After the Depression ended the council revalued all his land that he had improved and charged him outrageous rates and eventually he sold it all.

I asked Grandma what the banks did with all the foreclosures. She said that there was no-one to sell it to so in most cases the owners stayed on and eventually repaid their mortgages years later.

 

[Ed Barton]

Cyprus has rejected the plan.

http://www.washingtonpost.com/world...2f5e26-90b5-11e2-9173-7f87cda73b49_story.html

 

[willair]

Cyprus has rejected the plan.

http://www.washingtonpost.com/world...2f5e26-90b5-11e2-9173-7f87cda73b49_story.html

The only question to ask is who's next ,i just hope this does not turn into a freefall panic because the way the ASX is tracking over the past few days and now below the 5000 mark and spot gold is starting to turn..

http://en.wikipedia.org/wiki/Panic_of_1837

 

[attrill]

Cyprus is a very small ecomony, which makes it a great testing ground to see what sort of behaviour the population will accept. People are people, whever they are.

If this eventually goes through it sets a very dangerous precedence. Good to see it did not get one favourable vote in their parliament.

Just a thought...

 

[greedy2000]

Cyprus has rejected the plan.

http://www.washingtonpost.com/world...2f5e26-90b5-11e2-9173-7f87cda73b49_story.html

One question for you. If you had money in a bank account in Cyprus would you keep it there when the banks open or withdraw it immediately?

I know what I'd do and I imagine its the same that most would do. It'll be gone in a flash!

I'm thinking that there were a few Russian Mafia types tapping Cypriot politicians on the shoulder...

 

[Aaron_C]

I'm thinking that there were a few Russian Mafia types tapping Cypriot politicians on the shoulder...

Well you don't need to be tapped on the shoulder by the Russian mob to understand how ludicrous this plan is.

 

[attrill]

I can see the next breaking story being about a disgruntled Cypriot bank employee leaking details of which Cypriot beaurcrats were making large cash withdrawls from their accounts last week...

Just a thought...