E-mail updates
Follow on Twitter
Subscribe to RSSNICOSIA -- Cyprus said on Saturday it was looking at seizing a quarter of the value of big deposits at its largest bank as it races to raise the funds for a bailout from the European Union and to avert financial collapse.
Finance Minister Michael Sarris said "significant progress" had been made in talks in Nicosia with officials from the European Union, European Central Bank and International Monetary Fund.
He confirmed discussions were centered on a possible levy of around 25 percent on holdings of over 100,000 euros (about $130,000) at Bank of Cyprus, and expressed hope that a package could be ready by the end of the day for approval by parliament.
Cyprus faces a Monday deadline to clinch a bailout deal with the EU or the European Central Bank says it will cut off emergency cash to the island's over-sized and stricken banks, spelling certain collapse and a potential exit from Europe's single currency.
Amid signs of momentum, Cypriot and EU officials said Cypriot President Nicos Anastasiades was expected in Brussels on Sunday to meet EU leaders including Council President Herman Van Rompuy and Commission President Jose-Manuel Barroso, as well as IMF Managing Director Christine Lagarde and the head of the ECB, Mario Draghi.
Protesters in Cyprus gather outside parliament as government officials try to strike a bailout deal with the European Union. NBCNews.com's Dara Brown reports.
Van Rompuy and Barroso canceled a planned EU-Japan summit in Tokyo to tend to the Cyprus saga and euro zone officials told Reuters that the bloc's 17 finance ministers would meet on Sunday afternoon.
"Significant progress has been made in the direction of getting a deal, at least at the troika level," Sarris told reporters.
He said a number of issues were still outstanding, but that a package could be ready "late this afternoon or early evening" for approval by parliament.
Arriving at the troika talks, Andreas Artemi, chairman of Bank of Cyprus, was asked if a 25 percent haircut was being considered on uninsured deposits. He replied: "I don't know that yet."
A senior lawmaker told Reuters earlier on Saturday that parliament was not expected to convene until after the meeting of euro zone finance ministers on Sunday afternoon, taking the crisis right down to the wire.
The same legislature on Tuesday angrily threw out a proposed levy on bank deposits, designed to raise the 5.8 billion euros the EU wants in return for a 10 billion euro ($13 billion) bailout.
'Edge of an abyss'
The tax is unprecedented in Europe's handling of a debt crisis that has spread from Greece, to Ireland, Portugal, Spain and Italy. It is by no means certain the tiny legislature will accept the measure this time around.
The turnaround came after Russia rebuffed Cypriot entreaties to help its banks, where Russian citizens and other foreigners have billions of euros at stake.
Significantly, the latest proposal would spare small depositors, who were outraged by the original plan to hit small holdings as well as large accounts, many of them held by rich foreigners including Russians.
Cypriot leaders fear the damage the levy would do to the country's offshore banking industry.
The tottering banks hold 68 billion euros ($88 billion) in deposits, including 38 billion ($49 billion) in accounts of more than 100,000 euros - enormous sums for an island of 1.1 million people which could never sustain such a big financial system on its own.
But much of the banks' capital was wiped out by investments in Greece, the epicenter of the euro zone debt crisis.
Racing to placate its European partners, Cypriot lawmakers voted in late-night session on Friday to nationalize state pensions and split failing lenders into good and bad banks.
They also gave the government powers to impose capital controls on banks, anticipating a flood of money from the island when banks are due to reopen on Tuesday after more than a week of lockdown.
The plan to nationalize semi-state pension funds has, however, met with resistance, particularly from Germany which made clear that tapping pensions could be even more painful for ordinary Cypriots than a deposit levy.
The pace of the unfolding drama has stunned Cypriots, who have besieged bank cash machines since the levy was first mooted a week ago.
"Our so-called friends and partners sold us out," said Marios Panayides, 65, a protester at the parliament. "They have completely abandoned us on the edge of an abyss."
Related:
Europe, Cyprus locked in multi-billion-dollar game of chicken
Bernanke: Cyprus poses 'no major risk' to US banks, economy
Leave a Comment:
The party never lasts that long. The sun rises the next day, hangover or not. Time to pay for your excesses.
Let's hope that this trend catches on Internationally.
After all the excessively rich only generate their riches through taking advantage of the system and the Public.
Let this be the "99%ers Spring."
Dear Never:
Let me guess - you never got squat as a result of your own efforts - you, and your so called 99% are nothing but warts on the azz of progress.
@Never Stop ... - So, do you consider someone rich just because they have over $130,000 dollars in the bank. Many people who are far from rich have this level of savings, particularly those who do not have a union pension to take care of them in retirement. Even those who have 401(k) accounts with their employer still save outside of the plan. And what about people who are doing the smart thing and saving up for a house. There are many areas of this country where if you want to buy even a modest house and want to put 20% down to avoid PMI that you would need at least $100,000 to even consider it. When I bought my last place I had to come up with that much and still had to have enough in reserve to keep the lender happy. I am far from wealthy but at my age have substantial savings to live off of in retirement. Should I have that security taken away from me to pay for the mistakes of others?!?! Why should people who worked hard and saved their money be penalized. These are the responsible people who are not looking for government handouts or walking away from homes and leaving the banks with homes worth less than what they owe. People that are responsible and saved for the current rainy day the world economy is having should be applauded, not penalized. I guess you are just one of those people who believes in redistribution of wealth from those who worked hard to get it to those who want to sit on their asses and collect handouts.
Yes, let the whole world "eat the rich".
How stupid! Yes there is definately an equity gap between the ultra rich and the rest of the humanity but $130,000 Euros isn't ultra rich. Middle class people who planned for retirement have more than that. I almost have that much myself and will need at least 3 - 4 times that if I plan to retire minimally comfortable in a lower cost of living community.
Dear JS.
Right on, my brother!
Welcome to Atlas Shrugged. That is the solution - let the productive people go on strike because they are tired of wiping the snotty noses of the voluntarily unproductive!
So let me see
If a country is deep in debt then they have the right to steal from your meager savings.
Well the precedent has been set so some countries must be salivation at the idea when they have mismanaged the economy then they always can fall back on their workers and empty their bank accounts.
If I lived in one of the poorer countries Europe I would be scared to death of what Brussels can do to me. Then again what about the US with 17+ Trillion bucks debt load and climbing. The lawyers would say the precedent has been set and is in the books.
Back to the days of the robber barons.
socialism is winning?
pigotry; yep, we should learn from what they are doing; do not just stop at Bank deposits, go into pensions, annuity's ,401k, ira and all trusts; take 25% so our government can balance the books, also give all on welfare, food stamps, government paid houseing a raise, it is so unjust that some people are successful and accumulate wealth, we must redistribute all wealth so there will be no rich people, and everyone can be comfortable and happy, Marxism is the answer to all of society's problems.(if anyone believes what I have written pleas go jump off a tall bridge)
A perfect example of our near future as with unpayable debt and out of control spending (Spreading the Wealth) and corruption.
Never, you must be a professional freeloader.
I dig.
I can never get behind a bank taking people's money, But we are talking about a bank that was being used as a safe haven for tax evaders, just like the Cayman Islands and the Swiss banks. I would be lying if i said i had any sympathy for those who were using it has a tax shelter so they didn't have to pay their fair share. Of course it's always the little guy that gets screwed. You watch the Top Depositors will get a loop hole that gets them off the hook. Money buys corruption, just ask our politicians.
Hello folks, as you can see there are two camps when it comes to the perception of the Cyprus bank robbery.
The first camp are the well indoctrinated sheeple who have no understanding of how money is created and believes that the uber wealthy have attained wealth beyond comprehension through hard work and ingenuity.
The second are those that see the austerity and Capital Control train coming around the corner to their home towns and know if wealth was a product of hard work, the mother of 4 in the Sudan would replace bank accounts with Soros and Buffet.
The bank deposit levy or tax that the Troika (European Commission, European Central Bank and the IMF) is imposing on the Cypriot people under the guise that this is their idea is beyond ludicrous.
This is a litmus test to see if those in the second camp will tolerate the theft. We know those in the first camp would bend over at the airports after being radiated and molested because a suppository bomber was thought to exist.
Has the absurdity of what is going on in the global economic system hit you yet? The countries that have a central bank are bankrupt. They are unable to handle the debt burden they currently have and are trying to acquire more debt to resolve their initial debt burden. That is the classical definition of insanity.
The most ironic part of this economic morass is that the people in the first camp have excepted this scenario as a normal, logical viable process in resolving a countries economic debt problem. The second group needs to pull its head out of
it’s a$Sthe sand and let the banksters know that global financial consolidation aint going to happen.“Cyprus is just another Test Market, a beta test. I don’t think any of those involved in the inner vicious circle of all this “had no idea” what the repercussions would be: we are talking €10 billion here, when Greece has already cost the EU close to €200 billion. Berlin saw this as a relatively small way to gauge several things: could they get away with citizen-looting in order to pay the bills of their masters? Could they do it without hacking Russia off? Would this put Draghi in his box? What effect might that have on the Troika negotiations in Athens? And based on all that data, is it really worthwhile staying in the euro, or should we GTF out before things become seriously expensive – thus reducing the heat we’re getting from our Bankfurters?”
The US, UK, Spain, New Zealand, Australia, Italy...etc are all contemplating a "bank deposit tax". Hold on to your hats because this situation is not going away.
One thing even both camps should be able to see, perhaps not with the most extreme of the first camp, is that around our entire planet, nobody’s money is safe in the banks.
Remember folks, if you don’t have your money in your pocket, you really don’t have it!
Hey, I didn't know Obama was elected President of Cypress?!?
Step 1: take away the best weapons citizens have so they can't revolt with anything but a "biden shotgun"
Step 2: slowly take away basic freedoms and wealth
Step 3: Enjoy ruling over your slaves
You think 100K is excessively rich? We cleared about 1.5 mil from my house moved to Russia this year and bought another house and have 600K in the bank that hasn't been invested yet. If I had moved to Cyprus (which we were actively considering for a while but opted for low debt Russia instead) we might be out 150K soon. This easily hits the middle class but I suppose if you live in a country with high debt (what is the US debt again? 107%) you better expect this type of thing may happen. The alternative is that said country simply prints more money which makes any money you have in the bank worth a lot less. Either way you may be f..ked if you have cash savings. Better spend your money fast.
There's going to be more than a few angry Oligarchs from the CIS nations. They bank there intentionally to avoid taxes and now it's going to bite them in the a$$.
Cyprus now looks to take 25 percent from bank accounts of wealthy
Wow. Just when you think Cyprus cannot possibly get more stupid, their officials prove you to be wrong.
Cyprus has now injected fear into the market place, which is one of the last remaining ingredients needed to cause a run on the banks. Their economy runs on the money of the wealthy, which is now under attack by their government.
Look for their banks to be systematically drained of capital, new capital to be sparse, a huge drop in demand due to capital flight, and most likely, mass protests that will turn violent.
I think they just cooked their goose.
Absolutely, Glenn. That was my first thought. If I were a Cypriot, 2 seconds after they announced those intentions I wouldn't have a penny in the bank. Idiots.
"@greatwhiteshark
Let me guess - you never got squat as a result of your own efforts - you, and your so called 99% are nothing but warts on the azz of progress."
And how is giving all the money to the 1% that have more money than they will ever spend and sucking the life out of the middle class, the ones that spend, progress? While we may be the warts you are the AZZ.
"Has the absurdity of what is going on in the global economic system hit you yet? The countries that have a central bank are bankrupt. They are unable to handle the debt burden they currently have and are trying to acquire more debt to resolve their initial debt burden"
That's because "central banks" are a debt creating machine. The whole fiat money system is based on debt and borrowing. It creates money from nothing and charges you interest it. Its a giant scam and every country with a fiat money system will fail at some point. ALL!
@BP who are you to say who has more money than they will ever spend -- SO WHAT they EARNED the money. As usual you assume if the government confiscates $$$ from the top 1% they'll leave middle class alone? What a JOKE! The government, in particular this corrupt admin, will suck every dime they can from anyone that is working and SPEND it, not reduce debt. Look at the dirt bag Patty Murray in WA and her friggin LOL budget proposal. I think EVERYONE should pay their fair share, once EVERYONE has skin in the game then maybe they'll vote responsibly. As it stands now the takers vote for their taxpayer funded freebies with no regard for the providers and the government hands the takers OUR money to secure the low life bottom feeders vote.
Per Mr. "White House Press surrogate" Canary.....the White House is watching this "thievery" very closely.
Wait a minute....what is Mr. Turbo Tax Geithner doing raiding IRAs and 401ks to "extend the government spending" past the National Debt Limit deadline ?
--------------------------------------------------------------------------------------------------------------------------------------
For those folks who thinks the "rich" are just getting "richer"....maybe they HAD A JOB. Time to get off your azz and work for a living.
BP-2252891 YOU ARE SO RIGHT! And all of these central banks are linked. That is why the QEs monies went to Europe to bail them out and why The U.S. workers are still in a depression while our politicians, Wall St. and the big banks are raking in the dough.
Our Fed is a private company founded and run for a very few of the richest Jewish families in the world for their own benefit. They create money(the US dollar) "out of thin air" to buy US debt instruments and get paid interest for this fake money from the taxpayers. In the end when America defaults, the Federal Reserve (the proclaimed U.S. Central Bank) will call all of those Treasury notes, bills, bonds, etc and will then own the ENTIRE United States of American lock, stock, and barrel. The rest of us will be indebted slaves to their idea of fascist capitalism.
Last time I looked, Warren Buffet wasn't Jewish.
I heard, but don't know to be true, that a large percentage of the deposits are of foreign accounts. If true then perhaps merely the risk of banking in a shaky economic period?
If Cyprus is the choice of investment by foreign entities, isn't it to wise of them to help prop up the Cyprus bank for future use?
AND, he was not a founder of the Fed in 1913 either was he? In fact. he originally was a stockbroker and insurance man and NOT an affiliate of the Fed. He is a Scandinavian man.
The Fed is a Jewish construct of the Zionists whose goal is world domination. As a Texan, you'd better hurry up and secede while you can.
I guess having an economy them wearing cement shoes isn't thought to be enough to drown the economy.
well, if you listen to Paul Ryan closely he's saying something similar but it's refered to entitlements- of which the largest in the US are: SS, Medicare. So, we're seeing this being proposed under the guise of something else (we spend too much) and taxes (at a 50-year low) being too high....
I'm all for being taxed less and looking at spending for the largest 3 line item expenditures on our balance sheet: SS, Healthcare, Defense. All 3 constitute ~ 65% of the US budget...(that's reality folks..)
Aren't entitlements mega millionaires giving money to their kids to make them mega millionaires without paying taxes or working also? All wealth comes from the land and people.
Wow! So the EU is pushing for stealing to pay debts? And it looks like the libs agree that stealing is fine with them. Heck, even pigotry agrees that socialism is a crooked system based on stealing. And, no! This isn't a "tax" in any sense of the word. All this money they want to steal is after tax dollars. Wish I could find out who Never Stop Asking Questions is and where (s)he lives so I could go and take what he has for myself. And to think there would be no complaints about that from him/her! A rarity for one to be more generous with their own money than with other people's money.
Hello BP and Gil, as you can see there are many who don't understand that the Federal Reserve is no more Federal than Federal Express. The Fed's Fractional Reserve Banking System is designed to put them in debt and make them economic slaves. It's a concept that when researched and understood pisses people off. And it should.
In article one section 8 of our constitution it states that we are to "coin our own money and regulate the value therof."
As it stands right now a group of mostly foreign banksters (Federal Reserve, 8 banking families) with the Rothschild's at their head, a private corporation control our currency. Does that seem right to you? Of course not unless you are a drone, but they have bribed our elected officials to accept their banking cartel.
In Article 1 section 10 it states:
No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts;
So the fact is that we have been hijacked to accept counterfeit currency (fiat paper). The Federal Reserve banksters are counterfeiters and this violates the law of our constitution.
What is going on right now in Europe, Australia, New Zealand and the US is that the global banking cartel is making a brazen and bold move to consolidate these economies into one global bank.
What is going on in Cyprus is the beta test to see if they can force a country to secede its sovereignty to the European Union.
Remember folks, at the heart and root of all of our financial debt problems is the Federal Reserve. It is a system that is designed to put and keep economies in debt. They control the booms and busts intentionally to form dependence, acceptance and finally subservient capitulation to their greedy lust for power and control of anyone involved with a Rothschild's central bank.
Let the banks fail. Let their financial system fail. There is no such thing as too big to fail. This is why Anti-Trust laws are in place in our country. So there should never be too big to fail. A bad business needs to fail so that good ones can succeed. It is the very nature of the free market.
Pay attention America: This is exactly what the current W.H. Administration wil have to do to pay for Obamacare. He has hinted several times that he wants the authority to tax everything from earth worms to buzzards.
Gee, its a good thing then that the rich have most of their money in investments, not in banks....
/s
First, these are uninsured deposits. (Why would anyone put a lot of money in an uninsured account, in a tiny island country, when there are so many better alternatives?) Because, second, they are used by wealthy foreign depositors to avoid paying taxes in their own countries.
So when you have corruption on one side, (the depositors), should it come as any surprise when you have corruption on the side of the banks?
In a perfect world, this wouldn't happen. But then again, people would pay their taxes honestly in that world, too.
This gives validity to the statement:
"A government big enough to give you everything you want, is a government big enough to take away everything that you have."
Or as Thomas Jefferson said"
"The natural progress of things is for liberty to yield, and government to gain ground."
Coming to America in the near future.
Losers like "never stop asking questions" supports this because he is a loser in life and doesn't have anything for the govt to take. He lives off of people that work for a living, save, and make good decisions in life. People like him probably voted for Obama because he got an Obama phone. People like this should be shamed into living under a bridge because he is not an American. True Americans believe in hard work and doing the right things. People like "Never" believe in being lazy and mooching off the system. Look at him....he wants Obama to take your money and give it to him so that he doesn't have to do anything in life. Yep, America is becoming a nation of losers.
There's a reason the EU is pushing this solution. Cyprus is a tax haven country known as a safe place for the wealthy to hide money. After this seizure they might think it safer to pay their taxes and leave the money in their own country. Allowing tax evaders to hide and launder money doesn't make you very popular with your neighbors.
Paws93, you're a typical, ill informed, poster. The life line assistance program was started in 1985, but now it's "an Obama phone'?
I guess the program was OK with you until Obama became President, right?
You're right, America is becoming a nation of losers, and you're one of them because you can't take the time to understand what is really going on. Talk about low information voters, You, and many others on here are poster children for them.
Wow Mike...You really got me there...not!!! Actually I heard the phrase "Obama Phone" from one of his own supporters through his re-election campaign. Sorry for utilizing their own words. But, to answer your question, ABSOLUTELY NOT should the govt be giving out phone service to people. And I don't care who the president is or was. But, Obama is president now. Geesh, even the poorest of the poor people get food stamps, welfare, medicaid, unearned tax credit refunds, subsidized housing, etc. Why don't we just give them a butler and maid service as well? My cell phone plan costs $80 PER YEAR. And, Obama removed the work requirement that Clinton signed. How pathetic is that?
Most of all, you tried to pick out one small thing to catch me on and you totally ignored all of the other..including the most important part. Do you support govt ROBBING its citizens of 25% of their bank accounts like "never" does because he can not succeed in life and is jealous of those that do? Are you so jealous of the rich like "never" is? Do you chant "tax the rich" every morning?
I'm sick and tired of my taxes going up, my healthcare costs going up, etc, to fund these people who refuse to work. I do not care if you don't want to take the trash out at Burger King....Tough stuff. And now, people like "never" are supporting govt stealing 25% of my work and good decisions in life.
You can call me a "loser", but I am the one paying for these losers.
Obama and the American Democrats must be salivating at the model they see in Cypress. It will likely happen here in the not so distant future.
Just think about it, you can spend, spend, spend, throw a tantrum at the very idea of living within our means and call anyone suggesting that we should live within our means "extremists", "idiots" or "tea-baggers".
Meanwhile, print billions of Dollars per month to debase our currency, formerly one of the world's strongest, and add as many new government offices and new entitlements as you can, and when the whole thing collapses, you can just confiscate the people's bank accounts and retirement savings and tell them there is no choice, and it's all for their own good.
If you think it can't happen here, you're not paying attention.
First the wealthy. Who's next?
Theft is theft. If the wealthy got their wealth by fraudulent means, deal with that in the courts.
I agree, this is bad precedent. They take 25%, no one will ever put a buck in their banks again. Contrary to dem's- tax everyone in sight to make everyone poor mentality.... wealth invested with a level playing fields does create new wealth - redistribution of this kind is not good. They really need to go through orderly bankruptcy and tell the eu to f'off. I don't know what the EU has for control over these countries but it makes you wonder.
Well said. Once you set the precedent, the only debate left is about where to set the bar. It reminds me of the man who asked a woman he just met if she would sleep with him for a million dollars. When she said she would, he then asked, "Well, how about fifty?" She replied, "What kind of person do you think I am?" He said, "We've already established what kind of person you are. All we're doing now is haggling over the price."
These If I lost 25% of my bank account, the first thing I would do when the banks opened is remove 100% of my remaining money and move it to a more stable country. Let's see how their system does when all of their large depositors remove all their money. These guys are walking a razor's edge and going to get cut.
Gneisenau, Cyprus will not allow for individuals to remove all their money from the banks. The people will have a daily limit of withdrawals. The banks are not stupid.
@ Jim - Then I guess they will just take the maximum amount they can daily and refuse to deposit any more. The end result is the same, it just takes a bit longer.
The crisis is based on the principle that the banks must always be repaid. That's why they constantly come up with schemes to refinance unmanageable debt of countries, so an actual default never happens. Once one debt-laden nation says We give up, we aren't going to repay, that attitude could spread to other nations and the whole game might collapse.
Wealth is relative. In some cases $10,000 is wealthy. Soon the governments will delcare that anyone with $10,000 in a savings or checking account is RICH and they will take your money and there is not a damn thing you can do about it. You have a classic car in the garage? They will take it and give it to some guy that doesn't have a car. You live alone in a house with 3 or 4 bedrooms? You will soon have families living with you. This is only fair. Why should you have shelter when others have none? Your new house mates ( comrades ) don't speak English? Not to worry, you can learn a foreign language, don't be so lazy. It's coming folks, maybe not right away, but soon. All the signs are there for you to see and it's nothing new. It has all happened before. Punish the rich and give it to the slackers and stoners. They are all around you and you see them everyday. All those tatted up freaks with all their piercings and welfare credit cards. They are going to spend your retirement money. When that's all gone they are going to feed on each other. All societys fall and this one is no different. Greed and corruption will be the death of us all. No one wants to know what comes after that.
Gneisenau— If the United States fails there is no place to go and deposit your money even if you were able to get it all out. What free country would you go to that does not rely on the USA to protect tem??
Name one. What banking system exists that does not rely on the continued success of the USA to prop it up? If this society fails you might as well just jump off a bridge. People all over the world come to the USA to seek asylum when their countries fall apart. The USA allows everyone over 18 to vote. I believe in equality, but there are far too many morons who vote. They make decisions about how our country should be run but they can't manage their own lives. Anyone think that this is a good idea? We allow everyone to vote that shows up, there are very few safeguards to election fraud. Some rules exist but are rarely followed. In many states you go to a polling place run by old ladies and old men that are just writing down names. You could tell them anything. We have about 20 million illegals in this country and it's suspected that as many as 7 to 10 million illegals vote in every national election. How do you think they vote? They vote for free stuff paid for by other peoples money. How long does anyone think that can go on. We are in trouble folks and it isn't going away.
Anyone think I'm an alarmist?? Copy and paste this on your fridge and call me in 10 years. I'd be happy to apologise if necessary.
@ Dan - I'm talking about the Cypriot banks and depositors. Who would be stupid enough to keep a penny in a bank where they can loose so much so quickly? I sure wouldn't. I would extract 100% of my deposits at the fastest pace possible and refuse to deposit another dime in them.
However, the point can be extended to the US. How many large depositors would keep their money in any US bank when it was open to loose 25% of it's value at the whim of Washington? Their money would be gone from the US so fast the resulting vacuum would collapse the White House and the halls of congress.
Cyprus is nothing but a laundry mat for Russian dirty money. Russian bankers and financiers (should) own this problem, let them pay the price, not the ordinary savers of Cyprus. Why do ordinary people world wide keep having to pay for bank bailout after bailout, and while every time there's a crisis Wall Street money hookers and bankers get huge, disgusting bonuses that could feed a small city for a year? I'm not suggesting revolution, but some kind of international banking laws must be passed and enforced that curb reckless banking behavior.
When bankers start going after people's savings to cover their losses, as is happening in Cyprus now, people just won't stand for that nonsense too long. This also teaches me to stay away from the Euro in the near term. Stay very far away.
Watch what happens when the russians take the other 75% that they got to keep out of the bank. That money in the bank is just another LOAN to cyprus. The banks can then loan it out and in theory make a profit by loaning it out for more than they pay to the depositors.
So stupid, they get a little loan from the EU and they lose their big loan from private investors.
The situation in Cyprus is far beyond compensating bankers. The banks are insolvent and depend on loans from the ECB and others to keep operating. If they fail, the Cypriot government is on the hook for more than 30 billion Euros in deposit insurance (deposits under 100,000 Euros are insured). The entire GDP of Cyprus is just 25 billion Euros. If the banks can't get the bailout from the ECB, Cyprus will probably have to leave the Euro Zone, and convert deposits to the Cypriot pound. That will probably result in an effective devaluation of 30%-40% for everyone, not just the large depositors.
One way or the other, the Cypriots will pay.
BBC: "Germany has also made it clear that it will no longer accept an economy within the eurozone that is dominated by its status as an economic tax haven, our correspondent adds".
What I cannot bring myself to comprehend is what Germany thinks Cyprus' comparative advantage will be in the future; if not a reputable (as reputable as London and Frankfurt, as it seems that Cypriot authorities would welcome a comparison on international standards) financial services hub, then what? it cannot go into car manufacturing nor, say, submarines or general manufacturing like Germany so what is it left with? agriculture? no land for that. Tourism? it can only get you so far (currently 13% of GDP). So what then?
Should we imagine a common market where some member states' citizens will just have to accept that they will have 50% the standard of living of the Germans or the Dutch? And once this realization sinks in, for how long do any of us imagine that countries like Cyprus, Malta, Spain and others will choose to remain in such a market while in an inflexible non-optimal currency area at the same time, with no re-distribution in its remit?
I would like to express in the strongest terms possible, my fear that a few years from now, what is going to be at stake or at risk is not merely the Euro but the entire European political project.
Philippos
Cyprus will be out. The Russian mobsters will take a hit, but if Cyprus was smart they would follow the design of the Caribbean countries and become a hiding place for the rich. (Sorta like they do now, but without the pesky interference of the EU)
I wonder what Mr. Putin and his gangs will do about the European union confiscating their loot.
A 25% levy - yeah, it's called stealing! At least the banks in the USA just steal your interest and rob you blind with hidden fees. We are much more subtle here in the states. I'm sure Obama will probably try to adopt this as a new model though. Hey - if it works for Cyprus....
25% for people with less than €150k is really outrageous. These people are not rich and maybe have only gone over the €100k limit in recent weeks and maybe only had any money in Cyprus for months, not years...those people have NOT benefitted from high interest rates and so careful saving pensioners will be hit as hard as dodgy Russian mafia....how on earth is this far ? A sliding scale from €100k upwards beginning at 3% and then adding 0.5% for every extra €20k would be a fairer to those savers over €100k but not rich.
We are complete F@ck ups when it comes to governing our country so to compensate we are going to steal your money. seems legit.
Now that's what you call a return on investment.
Can't you just see the advertisements? Deposit your funds in our bank, and our government confiscates 25%! That's this year. Next year? Who knows?
The end product of all liberal governments is financial failure for everyone who doesn't live off the government, and ultimately a lowest common denominator lifestyle for all.
This is what happens when currency is backed by nothing but debt.
yield 25% now or risk loosing 100% later ?
Watch the bacn collapse. I ould encourage anyone living in Cyprus to withdraw all your money. You don't think that there are libs in the USA wishing they could do this here ?
The fools on The Hill already have begun with even more spending,higher taxes and growing the debt refusing to truly balance the budget. That goes for both parties, they're in so deep they don't know how to get out.
I have been slowly withdrawing from my accounts and buying non perishable goods for survival that also can be traded for other essentials should the dollar collapse. Gold and silver is an option but when push comes to shove, you can't eat it or drink it.
Obamacare allows the federal government to have access to bank accounts.
We're already there.
Tammy-- This is one fact that few people have noticed about Obamacare. By the time the average citizen realises that this is just not some stupid rumor, it will be too late. People with small amounts of money in savings and checking will be wiped out by the millions and with no place to go for help.
i honestly wouldn't want to be robbing russian mobsters.
Is that different from the mobsters in Congress ?
Cypress now. The rest of the deep in debt world will follow.
Bet you on that one
Now we have an answer - having $130k is the threshold of wealthy.
Just wait to the Dems and the other liberal socialists come for your 401ks here - remember that idea was already floated here and under Obamacare - if you sell your house, they get 4% off the top!
Hope the Cypriots revolt and put their leader's heads on sticks - just as we should do here!
Yup. That massive pool of money sitting in 401k's is eventually going to prove irresistible to the U.S. government, and in any event, we've already seen how easily it can be wiped out when the insatiable greed of the financial corporations catches up with them...something that is absolutely guaranteed to happen again.
And don't even get me started on the unmitigated horror that would result by privatizing Social Security...yeah, in some ways I am one of those "liberal socialists," but I have the good sense to distrust the government almost as much as I distrust corporations.
Liberals welcome...this is the USA in 20 years...keep it under your mattress...
Wait until assest of wealthy are seized for the good of the state..Atlas Shrugged is coming to fruition
Ayn Rand and Ron Hubbard were both science fiction writers.I give as much credence to acolytes of those two authors as I do to the Trekkies...petQ !
Maybe, but L. Ron Hubbards books, come to real life in the form of Scientology, give him (the group he founded) tax free statues as a 'church'...So, Bill might not be as far off as you think...
Scientologists no more run things than do Rand's "producers".
When the dependent class has the majority of the votes, this is what happens.
Which is why citizenship should be earned and not granted.
This is pretty much the nail in the coffin for Cyprus and eventually the Euro. These guys are threatening to take 25% of deposits from the rich. So, say they vote to do just that. As soon as the banks open, there will be a massive run on the banks and the entire fractional reserve banking system of Cyprus will collapse throwing the nation into chaos and turmoil. Instead of this being isolated to a handful of banks, it's going to spread like wildfire. I believe that depositors in Greece are worried as well. This is a case of damned if you do, damned if you don't. Just face it, the game is over. I said it before and I'll say it again...the best case scenario for Cyprus is an organized, supervised default. They need to be kicked out of the eurozone. Greece also needs to go. Italy, Spain and Portugal are next. I fear that this is the beginning of the collapse of the global financial system. Did these banking morons not learn from the U.S. banking collapse in 2007-2008 that starting with Lehman Bros.? This is 2008 again on a global scale.
Scary it is. Think of it as a giant correction.
Ohiowire71: "Did these banking morons not learn from the U.S. banking collapse in 2007-2008..."?
Yes, what they learned is that formerly adequately wealthy common people can be divested of a large portion of their money without rioting in the streets. They learned that the poor can't even incur extra bus fare to complain about their situation, and the hard working class has no time to even think about causing a ruckus. They learned everything they need to know in order to rob you blind, deaf and speechless.
I wonder how much of Mitt's money will be taken. I think it's funny. Nobody lives there they just use the people there to help them avoid taxes in their own country. You really think that's right? I bet all the tax cheats are re-thinking their strategy. Who's next?
What do you mean "tax cheats"? I guess you're talking about the gov't that steals money from it's citizens for no reason except that it can by extortion? Pay up or go to prison, suckers? Do you pay more taxes than you are made to under threat of force? Does the gov't having their hand in your pocket everytime you turn around get you aroused? Well, be carefull, that hand is not that far from your balls...so in answering your question "who's next?"...maybe you are. Enjoy.
And by the way, I do think it's right to keep as much of your own money that you've earned away from your gov't. If they want money, let them sell apples...eff 'em.
Coming soon to a country near you! Our savior and Dear Leader will soon do this to all the evil rich people in America who have excess money not being used. This way his voter base can receive more entitlements for doing absolutely nothing! Socialism? YES WE CAN! Forward, Oink!
I've been reading your comments for a while, your hard to figure out.
Pigitry is not hard to figure out! This sexy piece of bacon wants all that the government has to offer, and if that means Dear Leader has to take from the evil rich to give me what I deserve then so be it! Evil rich people who work and save owe me a living. Forward, Oink!
Pigitry,
The ID theft says everything about you...superficial, petty and unoriginal.
Pig, and I think that's what you are, I 've had you on ignore for over a month. Suddenly you come back on. Oh well, back to the hog wallow for you.
imposter alert
I'm Pigotry
Pigitry is my evil twin!!
Pigitry with an 'I', an imposter, the evil twin.
.
hey, culheath (#18.3), I agree with you.
We agree frequently, Pigotry.
Pigitry is of a much better mind than the evil twin Pigotry. I can't wait to hear from the 3rd personality "Pigatry"...
I love hearing from Pigitry! She shows a good imagination, writing from the pigpen and it is a fun form of sacrilege to hear her views on gun control.
But to be politically unacceptable Miss Pigitry: I know you have to bring home the bacon for all your piglets but you shouldn't worry about our fearless leader bringing a 25% Cypress-like tax to the USA. If you are bringing home more than enough bacon you should share it with less fortunate pigs. Don't be a glutton, even though you are a pig.
Oh Miss Pigitry,
How right you are!
I kinda hope he does just that - what we need is a second American Revolution, winner take all.
I say we clean house.
Me too, and this time no reconstruction...no letting the minority of bigots and radical conservatives who've been preventing social advancement back into the fold. New century, new slate. Forward.
I love to see the socialists crash and burn. But this kind of thing could eventually happen here in the US. We are 16 trillion in debt and the Chinese might one day call an end to our stupid spending.
The Chinese own around 10% of our debt and this kind of thing will never happen in the US. Completely different economies.
It's not the socialists who are crashing and burning, it's the capitalists.
Apparently the threat of a 10% levy didn't sufficiently undermine confidence in the banking system, so now they're back threatening 25%?
To those of you who think that the 25% proposal is okay because it only targets the "wealthy," please grow up. I believe that the rich should pay their fair share as much as anyone (actually, probably more than most people), but to come in and arbitrarily confiscate a massive chunk of what people have already accrued is simply immoral, and something we never, ever want to see the government do. In addition, if the banking system simply collapses, without massive government aid directly to the people (which the Cypress government can't afford anyway), the suffering is going to be immense and far worse than anything they've endured thus far.
To look at this same basic issue in terms of America, the way to take back the wealth for the people is not through this type of tactic, but rather to switch from an income tax to a tax on consumption (with the appropriate credit for purchases of basic necessities, or with basic necessities simply exempted, so that the poor and working classes aren't unfairly impacted), raise the minimum wage to a living wage so that employers cannot get rich by relying on what is essentially slave labor (what what else can you call it when someone works five days out of every seven from morning till night and doesn't bring home enough to keep a roof over their head, heat their home AND put food on the table all in the same month?), and cap interest rates for ALL loans at an absolute maximum of, say, 6%. As long as we refuse to make these changes, the flow of wealth from those who already don't have enough to those who already have far more than they could ever need will continue unabated.
If I read it right, they went from 10% of everyone, to 25% of only the large depositors. They took a page out of Washington's playbook. Frankly, I think it's going to come right back and bite them right in the ass when all the rich people come together to get rid of those that stole their money.
One thing stands out on this forum. If you are critical of the free-loaders, you don't get many likes but if you support government taking from the wealthy, you get a whole bunch of likes.
This is the direction many wish for and is the reason Obama was reelected.
Why does the government need to Tax when It prints money when ever it wants ?
Exactly. Finally someone who understands the US economy. The tax thing is merely a threat of imprisonment from the IRS to keep the populace under it's thumb.
A life savings of $130,000 does not qualify a person as being rich. Maybe those with incomes over $130,000/year should pay more to avert the crises.
Many people with low incomes actually savings of over $100,000. They have done so by living frugally and are often people with no pension or 401(k) accounts, their savings is what they need to live on in retirement. Taking from them is penalizing the people who scrimped and saved rather than live beyond their means.
I doubt the Russian mob will take a 25% haircut on their accounts. All I see is government and bank officials disappearing. Never steal from the mob if you want to live.