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Old 03-19-2013, 12:10 AM  
Bewbies Bewbies is offline
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The Great Cyprus bank robbery

Has nobody really brought this up? Huge news of a tiny little island being used as a beta test for the EU and the USA. (no tin foil hat needed)

http://theeconomiccollapseblog.com/a...-it-everywhere

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yprus is a beta test. The banksters are trying to commit bank robbery in broad daylight, and they are eager to see if the rest of the world will let them get away with it.

Cyprus was probably chosen because it is very small (therefore nobody will care too much about it) and because there is a lot of foreign (i.e. Russian) money parked there.

The IMF and the EU could have easily bailed out Cyprus without any trouble whatsoever, but they purposely decided not to do that. Instead, they decided that this would be a great time to test the idea of a "wealth tax". The government of Cyprus was given two options by the IMF and the EU - either they could confiscate money from private bank accounts or they could leave the eurozone.

Apparently this was presented as a "take it or leave it" proposition, and many are using the world "blackmail" to describe what has happened. Sadly, this decision is going to set a very ominous precedent for the future and it is going to have ripple effects far beyond Cyprus.

After the banksters steal money from bank accounts in Cyprus they will start doing it everywhere. If this "bank robbery" goes well, it will only be a matter of time before depositors in nations such as Greece, Italy, Spain and Portugal are asked to take "haircuts" as well.
http://theeconomiccollapseblog.com/a...tfolio-is-safe

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Many of you may be entirely convinced that the Great Cyprus Bank Robbery could never happen in America.

Well, where do you think this whole plan was dreamed up?

It was the IMF that reportedly pushed the hardest for the wealth tax in Cyprus, and the IMF is headquartered right in the heart of Washington D.C.

Almost every nation on the planet has to deal with the IMF. It is an organization that is dominated by the United States and that is always involved when there is an international debt crisis.

If the IMF thinks that it is a great idea to steal from bank accounts to solve a financial crisis in Cyprus, why wouldn't they impose a similar solution in other countries in the future?

And if bank accounts are no longer safe, are there any truly safe places to put your money?

You can trust the politicians when they tell you that an unannounced "wealth tax" will never happen where you live if you want, but that is the exact same lie that the politicians in Cyprus were telling their people until the day that it happened. The following is from an article in the Cyprus Mail...

And after all, President Anastasiades had emphatically declared in his inauguration speech that “absolutely no reference to a haircut on public debt or deposits will be tolerated,” adding that “such an issue isn’t even up for discussion.” Finance Minister Michalis Sarris made similarly reassuring statements, arguing that it would be lunacy for the EU to impose such a measure because it would threaten the euro system.
There's a ton of articles out there about this thing, will post from a news source in next post. I put these up for discussion sake. Background story coming...
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Old 03-19-2013, 03:27 PM   #16
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Originally Posted by patteeu View Post
I don't buy the excuse that this is just a way of getting at Russian mobster money. It's either an OK thing to do or it isn't. (First they came for the mobsters... )

I find it troubling primarily because the tax is being levied on money already deposited without any chance for the owners to choose whether or not to expose themselves to it. In many of the most common tax schemes, a person can decide whether or not they want to earn an income (income tax), purchase a product (sales tax), invest in a dividend producing company or an interest bearing savings account, or sell an appreciated security. I'd have less problem with this deposits tax if it only applied to future deposits or if people had some time to withdraw their current balances without being exposed to the tax.

On the other hand, other than what I mentioned above, this isn't all that different from a property tax. If this is wrong, maybe we should reconsider our property tax system that chips away at our accumulated wealth year after year.

I look at it as closer to a classic bank failure. If your bank fails, your deposits disappear. In the modern era in the US we have federal deposit insurance, which says that if your bank fails, the first $100,000 of your money is insured by the Federal government (recently raised to $250,000) but the rest is lost. Deposit insurance in Cyprus covers the first 100,000.

This tax/expropriation is a compromise between letting the banks fail and wiping out the depositors and bailing them out completely as was done in other countries. I think the tax should only inflict haircuts on deposits over 100,000, but those depositors seem to have a lot of political power.
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Old 03-19-2013, 03:42 PM   #17
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Quote:
Originally Posted by FD View Post
I look at it as closer to a classic bank failure. If your bank fails, your deposits disappear. In the modern era in the US we have federal deposit insurance, which says that if your bank fails, the first $100,000 of your money is insured by the Federal government (recently raised to $250,000) but the rest is lost. Deposit insurance in Cyprus covers the first 100,000.

This tax/expropriation is a compromise between letting the banks fail and wiping out the depositors and bailing them out completely as was done in other countries. I think the tax should only inflict haircuts on deposits over 100,000, but those depositors seem to have a lot of political power.
Sell the banks to the Russian company offering to buy them.
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Old 03-19-2013, 04:22 PM   #18
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Originally Posted by FD View Post
I look at it as closer to a classic bank failure. If your bank fails, your deposits disappear. In the modern era in the US we have federal deposit insurance, which says that if your bank fails, the first $100,000 of your money is insured by the Federal government (recently raised to $250,000) but the rest is lost. Deposit insurance in Cyprus covers the first 100,000.

This tax/expropriation is a compromise between letting the banks fail and wiping out the depositors and bailing them out completely as was done in other countries. I think the tax should only inflict haircuts on deposits over 100,000, but those depositors seem to have a lot of political power.
If failure is imminent and this is the only way short of an extraordinary bailout to prevent it, that makes sense. If it's true that there are private entities willing to step in with cash, that option should be considered.
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Old 03-19-2013, 04:35 PM   #19
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Originally Posted by Bewbies View Post
Sell the banks to the Russian company offering to buy them.
If there is a real offer, I agree, and I suspect they would be happy to. The only thing I heard about it was the link you posted, which seemed like Gazprom offered to bail them out in exchange for Cyprus' oil rights, and something tells me thats not quite realistic.
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Old 03-19-2013, 04:43 PM   #20
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Originally Posted by Bewbies View Post
Sure. I've linked above to quotes from the EU not ruling this out elsewhere. In fact, I'll have to find it, but New Zealand is working on making this same scenario happen there.

There has been testimony before Congress on ideas of having the gov't "buy" our IRA's, 401k's etc and in return guarantee a 1-3% return annually in a type of social security thing. Also, during the Clinton admin, the idea of a wealth tax, where the gov't takes something like 10-15% of all retirement accounts as a one time tax was trial ballooned.

There's a lot of money sitting out there that the gov't doesn't have access to right now, and that's something they want to change. The world is broke, they are looking for solutions in every possible way except lowering spending.
There is talk of nationalizing 401ks etc. Desperate times will lead to desperate actions by govts. Not only are the govt's of world broke but more countries are trying to get out of the dollar. Russia already has as well as others.
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Old 03-19-2013, 07:42 PM   #21
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And certainly, a no way related story

Chase Bank customers temporarily see '0' balance



LOS ANGELES (KABC) -- Millions of Chase Bank customers across the U.S. who use online and mobile banking saw their checking and savings accounts with a zero balance on Monday.

The banking giant said the problem was an internal glitch.

"We have a technology problem regarding customers' balance information," Chase said in a statement. "It has nothing to do with cyber threats. It is an internal issue. We are very sorry to our customers for the inconvenience. This began earlier this evening. It is not confined to the West Coast."

The problem lasted a few hours. It was resolved around 7:30 p.m. PT.

Last week, the bank said it was victimized by a "distributed denial of service" attack. Chase websites were replaced with a message that said the system was temporarily down, but mobile apps were still available.


I mean, no way they were beta testing a US freeze, right?
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Old 03-19-2013, 08:43 PM   #22
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Every time the US government prints more money it's pretty much the same thing. Instead of taking the money straight from our accounts they devalues it.
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Old 03-19-2013, 10:59 PM   #23
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Originally Posted by BucEyedPea View Post
There is talk of nationalizing 401ks etc.
"Talk of"--the best of all sources.

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Old 03-20-2013, 06:45 AM   #24
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Tuesday, March 19, 2013
All Roads Lead to Cyprus

Posted by Daniel Greenfield @ the Sultan Knish blog 0 Comments

Cyprus is Europe's original failure. It was the first part of modern Europe to be invaded and colonized by Muslims, while its native Christian population was ethnically cleansed. Cyprus is to Islam what Czechoslovakia was to Nazism; the canary in the coal mine warning of worse things to come.


Now Cyprus has wound up in the middle of the European Union's meltdown as everyone scrambles to salvage what they can from an unsustainable system at the expense of everyone else. It's easy to look at what almost happened as another case of powerful elites abusing ordinary pensioners, but it's a good deal more complicated than that.

What we are actually seeing are the beginnings of bailout cannibalism as the Eurocrats manipulate entire nations into fighting each other while scrambling to gain some political advantage out of the mess. The real purpose of the deposit grab was to wreck Cyprus' banking sector and continue the centralization of international finance. At the same time it was meant to give German voters, who have been funding much of the mess, the feeling that other people were getting screwed as well.

Cyprus' government tried to salvage its banking sector by passing on the pain to ordinary depositors in one of those brutally unfair short-term/long-term decisions that technocrats like so long as they have the early warning to opt out of them. While the banks were closed to ordinary people, there's little doubt that plenty of insiders took the time to get their money out and it will be interesting to find out who they were.

But that largely doesn't matter. Bigger systems are bound to more corrupt and every regulation has its loopholes and exploiters. Everyone is badly overextended and betting on cleaning up once the rubble begins to fall.

In Cyprus, the Russian elite looking for a safe place to put its money when the people turn on them intersected with a Eurocratic elite trying to eliminate safe harbors and cheap places to do business. And they all bumped into British senior citizens looking for a cheap place to retire and angry leftists with no serious economic plan, but a determination to overthrow the government.

Cyprus is the place we go to learn that everything is tangled up with everything else and that there are no more answers left; just blame to be passed around and money to be stolen.

Everyone is deep in debt and no one is going to pay up. And why should they? Southern Europe may have dug itself into a hole, but the Eurocrats ordering them to dig out were the ones who provided the shovel because it seemed like a good idea at the time. Debt was a profitable and useful political tool. It still is.

American Federalism was built on the Federal assumption of state debts. Obama's two-term reign was built on massive bailouts used to consolidate power while reassuring the banks that they would be taken care of. The National Debt is headed into 17 trillion dollar territory because that too is a useful political tool. Driving the debt to the point where it can never be repaid is meant to transform the entire way we do business and spend money. And it's working.

Cyprus was a dirty little demonstration that you can kill two birds with one stone by giving a desperate government two impossible choices. And despite all the reassurances, there is no real reason to believe that it will stay in Cyprus. If anything the last few days have demonstrated how effective that particular tactic is. And once the money has fled Cyprus, the demonstration will be considered a success.

The problem with Europe, as with the United States, is that you can only assume so much debt and failure. German bankers may profit from pressing Cyprus depositors, but the German people are still in hock for far more than they should be. Similarly New York bankers and California Green tech entrepreneurs may be making money from the last four years, but their actual cities and states are deep in debt and floundering.

The European Union's interlinkage makes as little sense as tethering some of the most productive states in the United States to the least productive states. The sort of thing that outrages Europeans has long been taken for granted by Americans.


The two-term kleptocracy now in office was elected on an explicit pledge of wealth redistribution, but the process of moving money from healthy communities to unhealthy communities, from bad cities to good cities and from bad states to good states, has been underway for a while. And no one in the badlands ever has to pay a price for that.

Detroit, a city where hardly anyone bothers paying property taxes, has finally gotten an emergency financial manager, but there's no real reason to believe that the people sticking it out in Motor City who don't pay their bills, but do collect government cash, are going to change.

Someone else is going to have bail them out because Detroit is too big to fail, even though it has already failed, because the United States is too big to fail, and the United States is too big to fail for the same reason that the EU and the new Chinese capitalism and the Japanese gerontocracy are all too big to fail. Everyone is invested in everyone else and no one can afford for anyone to fail; unless it's small outposts like Cyprus that can be safely looted by the big boys.

But the real question is how long it will stay that way. For now everyone subscribes to the myth that a recovery is here and that all the really big investments that depend on working countries are safe.

China pretends that America isn't being run by lefty professors-for-life with worse math skills than manatees and America pretends that China's economy isn't one giant Potemkin village maintained with currency manipulation and slave labor. Everyone pretends that everyone wants to be in the EU, despite a pesky refusal to hold actual referendums on the topic (and to ignore those that have been held) and also pretends not to notice all the money in the EU budget that can't be accounted for.

All this is Cyprus and Greece, but on a much bigger scale. Everyone is spending money that they don't have as a return on future investments that depend on improved productivity and development; even as most of those countries commit to a Green worldview that exchanges development and productivity for austerity and malaise. China can still put pedal to the metal, because its middle class is still only forming. Once it has fully formed and the currency games end, then so will China's boom.

Whether or not other governments and their banking systems begin looting consumers as crudely as the Cyprus scheme attempted to do; loot them they shall. They have been looting them for some time already and there is no way that they are going to stop. The social and financial systems of the modern world are much too expensive and too unsustainable to do anything else. All this will be declared necessary. It will hit the rich harder than the middle class, on paper, though the reality will be different. And it will go on hitting the middle class, because that is, as a famous bank robber once said, where the money is.

The middle class is the economic heart of a nation. Building it up moves a country into first rank status. And then everything else follows, including a gargantuan government. Unbuilding a country requires trashing the middle class. And we are now in the unbuilding phase of human civilization.

The left likes to pretend that removing the middle class will make room for some clean regime of the oppressed. What it will actually do is remove the citizenry with enough power and wealth to keep government in check and replace it with beggars and rebels who depend on government subsidies while hating the government. If you want to see what an extended bout of that looks like, you can travel to the Middle East. These days you can try Europe as well.

Eurocrats fancied that the Arab Spring meant that the Muslim world was finally catching up to Europe. It's the other way around. These days Europe is catching up to the Arab Spring and not just because of the wave of Muslim colonists spreading across its shores. European countries are losing the vestiges of democracy and bouncing between unelected technocrats and elected extremists.

The Brotherhood phenomenon is not foreign to Europe. Not when Athens is tilting to the Golden Dawn and Italy's new power broker is a leftist comedian whose sole virtue is that he hates it all. Eventually the far right or the far left will get its ducks in a row and make a serious play for power and the Eurocrats will either be caught flatflooted or will be forced to invalidate elections. Either one is going to be ugly.


That is one more reason why American liberals should not be too proud of the Obama machine. What looks shiny and clever in 2013 may take on a whole different appearance as the malaise drags on and an angry jobless generation looks to get its payback and paychecks by voting for anyone who screams the loudest.

Beating Mitt Romney was no great achievement. Neither was beating McCain. But at some point the government-media complex of social welfare and crony capitalism will go up against an angry populist with an agenda and an organized movement, from the right or the left, and then things will get properly ugly. That man isn't on the scene yet, but he's probably hanging around meetings somewhere and imagining what he will do if he ever gets the chance. And if he ever gets the chance, it won't be pretty.

The establishment has no plan except to continue doing its thing while pretending that nothing is wrong. It can't fill the hole in the boat so it bails in more water from the ocean and calls it investment. It's a madness that will begin nearing its end once people are standing outside banks demanding their money back. And that is as true for the United States as it is for Europe.

The last century saw the development of a variety of unstable political and economic systems while this century tried to universalize them. Now we are all paying the price.

http://sultanknish.blogspot.com/2013...to-cyprus.html

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Old 03-20-2013, 08:11 AM   #25
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Got news for y'all: capital flight is already taking place. Countries are getting out of the dollar. China is one. Our media is not reporting it and our govt is lying.
Normalcy Bias has taken hold of many Americans....as in "it can't happen here." Or "it will never happen." It's happening and it's not gonna be good for us either. We are going to lose our standard of living. On the other hand, we've been living high on the hog because we have an institution that can simply print money, creating an apparency that we can never go broke. It has allowed us to buy imports and increase our standard of living without increasing our production because we can print dollars. The rest of the world knows this is coming to an end. Even the IMF has said a new global currency is needed. This is what happened to Great Britain, Germany and other countries...now us. This is how every superpower has ended.
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Old 03-20-2013, 01:14 PM   #26
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It looks like Spain likes the idea of confiscating savings.

Spanish Banks: A new tax on deposits?
• A new tax on deposits? The Finance Minister said yesterday in the Senate that the Government will impose a tax on bank deposits. According to press sources citing the Finance Minister, the levy would reach a maximum of 0.3% of time deposits. This tax would be approved by a Royal Decree.
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Old 03-20-2013, 02:20 PM   #27
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Jenkins: Yes, Let's 'Bail In' Depositors
One cheer for the Cyprus solution to banks that are 'too big to fail.'
By HOLMAN W. JENKINS, JR.

Politicians today face many challenges that are unrewarding to tackle, so no wonder many prefer to fulminate about too big to fail. Too big to fail, or TBTF, is a problem about which it is safe to fulminate, since neither politicians nor the public understand anything about it, and even less what to do about it.

Hence Sen. Carl Levin and others in Congress tirelessly flogging a trivial J.P. Morgan "whale" scandal. Hence the bizarre Eric Holder, our attorney general, suggesting in congressional testimony that he went easy on criminal prosecution of too-big-to-fail banks—and instead of being pilloried for his dereliction, being applauded for providing a new opportunity to deplore too-big-to-fail banks.

Of course, Mr. Holder was engaged in some form of fig leavery. For, in truth, big companies of any kind are seldom prosecuted, and it has nothing to do with TBTF. Since the Arthur Andersen fiasco, it simply hasn't been politically viable to risk destroying a large business, putting thousands out of work, to win a criminal conviction that a court later would likely throw out.

TBTF hardly stops Mr. Holder from bringing criminal charges against individual bankers. The deterrent there is the same—judges and juries simply haven't been supportive of attempts to stretch criminal law to cover greedy or foolish or unpopular behavior by business people.


In fact, it would be useful to understand all the things the too-big-to-fail problem is not.

TBTF doesn't prevent the government from seizing even very large financial institutions, throwing out managements, wiping out shareholders: It did so in the case of Fannie, Freddie, AIG, Washington Mutual and others.

TBTF isn't somehow a special problem in a general financial crisis. In a general crisis, it doesn't matter whether banks are big or small, government isn't going to let them fail for want of liquidity. Indeed, it would be idiotic to do so. In the last crisis, taxpayers made a nice business out of relieving a bank panic that arose, circularly, from fear that taxpayers would not act to relieve a bank panic.

So what's the real TBTF problem? It resides in the government-provided incentives for banks to get inefficiently big in the first place. Put simply, in the absence of such incentives, the risk-averse funding that banks thrive on wouldn't be available to allow banks to create sprawling credit portfolios impossible for regulators or investors in the marketplace to assess.

Let it be said that there is no cheaper form of grace today than engaging in populist tirades against the big banks. That's why so many privileged Wall Streeters practice the art loudly. But if you sense between the lines a certain attachment of big government to big banks, which have only gotten bigger since the financial crisis, you aren't wrong. Modern governments, as long as they're assuming the risks of the financial system, find it convenient to have those risks concentrated in a few very large, very handy institutions.

A lean, clean solution, if anyone were really interested, would be to require banks to hold Treasury paper against their insured deposits. Disturbed would be the certainty of uninsured creditors that they would be bailed out to minimize the cost of bailing out insured depositors. Yes, the implications would be profound. Checking-account customers might have to begin paying for the services they consume rather than being a hidden beneficiary of the rents from deposit insurance. This is a feature not a bug.

Those who prefer chimerical solutions like higher capital requirements maintain that the business of banks would survive forcing banks to rely more on equity than debt to finance their activities. If so, then why assume equity markets wouldn't throw up new business models to finance small businesses and credit-worthy consumers if government-insured deposits were no longer available at all to underwrite such risks?

Everyone keeps saying a safer financial system would rely more on equity, less on debt. No more expeditious way exists to reach that destination than by reforming deposit insurance.

Which brings us to the crisis du jour. From afar, it would be easy to underestimate how thoroughly depositors in Spain and Italy understand that they are inside the magic circle of "core Europe" and have nothing to fear from the Cyprus precedent, in which insured bank depositors might be asked partly to pay for their own bailout. Call it an astute cynicism about which euro countries are worth saving and which aren't. Europe-wide bank runs aren't in the offing.

Still, Europeans are living dangerously. The time to worry about moral hazard is between financial crises, when policy makers have an opportunity to change the incentives of the financial system. No solution at all is teaching the markets to rely on government guarantees and then yanking those guarantees away in a crisis.

Unfortunately, the warning is relevant to the United States. Dodd-Frank not only didn't fix too big to fail. As time may show, the law may also have made it harder to respond rationally to the next financial crisis.
http://online.wsj.com/article/SB1000...mod=hp_opinion
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Old 03-20-2013, 07:50 PM   #28
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Seriously, where is the outcry when our government prints more money? It is a different way of stealing the value of our dollar inside and outside of the banks.


Different methods with the same results.
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Old 03-20-2013, 07:58 PM   #29
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Seriously, where is the outcry when our government prints more money? It is a different way of stealing the value of our dollar inside and outside of the banks.


Different methods with the same results.
Shush. The moonbats want to talk about abu graibh.
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Old 03-20-2013, 08:15 PM   #30
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