# Shock in Cyprus as savers face bailout levy



## Pager (17 March 2013)

Now its a happened, could other nations in crisis decide to steal there citizens savings as well, looks an easy fix, take from those who have done the right thing and put aside some savings, and tell them they now have shares in a bankrupt bank 

http://www.bbc.co.uk/news/world-europe-21814325

People in Cyprus have reacted with shock to news of a one-off levy of up to 10% on savings as part of a 10bn-euro (£8.7bn; $13bn) bailout agreed in Brussels.

Savers could be seen queuing at cash machines amid resentment at the charge.

The deal reached with euro partners and the IMF marks a radical departure from previous international aid packages.


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## Garpal Gumnut (17 March 2013)

Pager said:


> Now its a happened, could other nations in crisis decide to steal there citizens savings as well, looks an easy fix, take from those who have done the right thing and put aside some savings, in Australia i think in the not too distant future Superanuation will become the target of cash grabs by government.
> 
> http://www.bbc.co.uk/news/world-europe-21814325
> 
> ...




This is nothing compared to the possible headline in Australia post budget 2013.

" Labor ALP Tax superannuation funds 10% "

gg


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## burglar (17 March 2013)

Pager said:


> Now its a happened, could other nations in crisis decide to steal there citizens savings as well, ...




Scary! What if this madness catches on?


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## drsmith (17 March 2013)

I can't wait to hear Nigel Farage's response in the EU parliament.

One does not have to be a genius to realise what depositors will do if they fear their funds are not safe.


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## tech/a (17 March 2013)

I'm off to Cyprus with a ship load of safes
And a concrete truck.

Holes in the ground will become very popular.


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## McLovin (17 March 2013)

They've taken the nuclear option on such a tiny economy and in the process have created the real possibility of bank runs in other countries. Seems a bit myopic to me.

It seems like they're going after foreigners (especially Russian ones) with this tax, and Cypriots are just collateral damage.


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## Tyler Durden (17 March 2013)

2013's trigger for the annual May share market downturn.


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## brty (17 March 2013)

The real problem is not just the run on banks, it is the lack of understanding by those in charge to make such decisions.

Then again, perhaps the Germans really are trying to crash the Euro to enhance their economy.


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## banco (17 March 2013)

brty said:


> The real problem is not just the run on banks, it is the lack of understanding by those in charge to make such decisions.
> 
> Then again, perhaps the Germans really are trying to crash the Euro to enhance their economy.




The Germans obviously didn't like the optics of bailing out a banking system that has heaps of Russian mob money in it without serious sanctions.


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## prawn_86 (17 March 2013)

This is one of the dumbest moves i have seen in a long time. Surely it wont pass through the Cypriot parliament?

World govs continue to provide no incentive to save and then wonder why their pension/social security etc debt keeps piling up


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## explod (17 March 2013)

http://www.reuters.com/article/2013/03/16/us-eurozone-cyprus-idUSBRE92E02220130316

Russia's Putin wont like it too much.  The KGB have been stacking it in Cyprus for yeas.  Just deserts though as they have taken it from the Russian people, in the following from Jim Sinclair:-

https://mail.google.com/mail/?shva=1#trash/13d75a88ab023812

This week could be very interesting.


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## notting (17 March 2013)

prawn_86 said:


> This is one of the dumbest moves i have seen in a long time. Surely it wont pass through the Cypriot parliament?
> 
> World govs continue to provide no incentive to save and then wonder why their pension/social security etc debt keeps piling up




I don't think they Cypriot Arians have any cash in their own banks.
It's all Russian Laundry.
I thinks it's hysterical.
Hope it brings a bit of action.


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## McLovin (17 March 2013)

notting said:


> I don't think they Cypriot Arians have any cash in their own banks.
> It's all Russian Laundry.
> I thinks it's hysterical.
> Hope it brings a bit of action.




Yeah. And Ze Germans know it too. Frau Merkel apparently is reluctant for Fritz Q Taxpayer to subsidise a few Soviet gangsters. Considering how those Russians got rich, I'd say it's Karma.


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## Tyler Durden (17 March 2013)

This is how I feel at the moment:


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## CanOz (17 March 2013)

> (CY) Cypriots lining up at ATMs to withdraw cash from banks ahead of expected deposit tax next week - NYT - Source TradeTheNews.com




This should provide a little volatility...

CanOz


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## So_Cynical (17 March 2013)

Sounds like a good idea to me, the super conservative and the wealthy will be hit the hardest and that's how it should be, poor people living month to month don't have much in the bank so wont suffer much...a one off 10% tax, the pain will be short and it will be over quickly.

The wealthy would of benefited the most when the economy was riding high, so only right they pay the most.


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## McLovin (17 March 2013)

So_Cynical said:


> The wealthy would of benefited the most when the economy was riding high, so only right they pay the most.




They also would have paid the most in tax. The "poor" likely paid no tax. Rinsing the rich never works because they and their capital is far more mobile than the poor and middle class, and they and their capital are the ones who are paying the bills. Luminaries like Argentina and Zimbabwe go down the path of asset confiscation.

Aside from that, there would be plenty of retirees with a couple of hundred thousand euros who will have just lost 10% of their life savings.


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## McLovin (17 March 2013)

Here's a little background...

I do remember from working over in Europe that Cyprus was considered a sunny place for shady people.


> In the seven years since she arrived in Cyprus as a penniless, unskilled immigrant from the former Soviet Union, Galia has carved out a lucrative niche in the island’s sprawling financial services sector.
> 
> Galia, who does not want her full name to be used, is the director of a Russian-owned company and, with the help of a local bank official, she helps a Russian government official bank money in Cyprus. The transfers arrive at irregular intervals, each amounting to about $1m, says the 35- year-old Nicosia resident, now a Cypriot citizen.
> 
> ...




http://www.ft.com/intl/cms/s/0/8eee4e24-8b0f-11e2-8fcf-00144feabdc0.html#axzz2NnW0O4Kd

It certainly provides pretty good justification for doing what they did. I don't think this would have occurred in any of the PIIGS. But bank runs can't really be ruled out.


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## prawn_86 (18 March 2013)

McLovin said:


> They also would have paid the most in tax. The "poor" likely paid no tax. Rinsing the rich never works because they and their capital is far more mobile than the poor and middle class, and they and their capital are the ones who are paying the bills. Luminaries like Argentina and Zimbabwe go down the path of asset confiscation.
> 
> Aside from that, there would be plenty of retirees with a couple of hundred thousand euros who will have just lost 10% of their life savings.




Yep it is the middle class that will be hit hardest. Or even those poor with a couple thousand int he back will still be slugged nearly 7%.

I dont see how you can think it is a good idea SC. What if someone had been saving for a medical expense (something like you are i beleive) and suddenly the gov takes 7% of that off you?


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## ASICK (18 March 2013)

http://www.infowars.com/confiscatio...ize-funds-directly-from-bank-account-holders/


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## pilots (18 March 2013)

So_Cynical said:


> Sounds like a good idea to me, the super conservative and the wealthy will be hit the hardest and that's how it should be, poor people living month to month don't have much in the bank so wont suffer much...a one off 10% tax, the pain will be short and it will be over quickly.
> 
> The wealthy would of benefited the most when the economy was riding high, so only right they pay the most.




R U 4 real????? bet you voted for the ALP, its the RICH and WEALTHY that employ people,  we need the rich and wealthy.


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## skyQuake (18 March 2013)

I think its a pretty stupid way to tax people.

Most of the rich would have their money tied up in bonds or risk assets (note 0.75% cyprus benchmark rate). And a regular joes saving up for a house would be completely screwed. That could be years of savings wiped out!


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## drsmith (18 March 2013)

So_Cynical said:


> Sounds like a good idea to me, the super conservative and the wealthy will be hit the hardest and that's how it should be, poor people living month to month don't have much in the bank so wont suffer much...a one off 10% tax, the pain will be short and it will be over quickly.
> 
> The wealthy would of benefited the most when the economy was riding high, so only right they pay the most.



The logic of class warfare is questionable at the best of times, let alone to the point of mutual destruction.


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## ASICK (18 March 2013)

http://www.infowars.com/saxo-bank-c...cialism-and-i-still-cant-believe-it-happened/


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## skc (18 March 2013)

tech/a said:


> I'm off to Cyprus with a ship load of safes
> And a concrete truck.
> 
> Holes in the ground will become very popular.




The tax component has already been frozen. The measure still has to pass parlimentary vote yet and I think there should be riots on the streets (if the Cyprians are anything like the Greeks).

Here are more views and analyses.

http://www.marketwatch.com/story/wh...prus-tax-shock-2013-03-17?mod=wsj_share_tweet


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## YMI (18 March 2013)

This seems like an harum-scarum action or idea and highly unfair to people who are saving small amounts of money for years. Not sure what they want to achieve but if it’s the further weakening of the Euro then it might just work. People all over Europe will lose trust in their banks.
I hope they considered possible consequences. :badass:


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## notting (18 March 2013)

Let's get them to invest their money and get Euro moving instead of sitting on it?


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## Julia (18 March 2013)

So_Cynical said:


> Sounds like a good idea to me, the super conservative and the wealthy will be hit the hardest and that's how it should be, poor people living month to month don't have much in the bank so wont suffer much...a one off 10% tax, the pain will be short and it will be over quickly.
> 
> The wealthy would of benefited the most when the economy was riding high, so only right they pay the most.



Your entrenched sense of envy toward anyone with more money or perhaps just more ability to save and/or generate money than yourself is so extreme that it renders you irrational.
It's not just the group that you would consider to be the idle rich who would be affected by this, (they will have taken measures to protect themselves from such legislation), but rather the ordinary folk doing their best to save to buy a modest home etc.


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## Aussiejeff (18 March 2013)

notting said:


> Let's get them to invest their money and get Euro moving instead of sitting on it?




Invest in what? Failed banks? Failed Businesses? Failed economy? With a guarantee of what? Failure of the investment?


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## Aussiejeff (18 March 2013)

YMI said:


> This seems like an harum-scarum action or idea and highly unfair to people who are saving small amounts of money for years. Not sure what they want to achieve but if it’s the further weakening of the Euro then it might just work. *People all over Europe will lose trust in their banks.*
> I hope they considered possible consequences. :badass:




Or worst case scenario if it all turns to $hite, people all over Europe will pack their bags and head for Oz on many trains, boats & planes. :1zhelp:


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## notting (18 March 2013)

Aussiejeff said:


> Invest in what? Failed banks? Failed Businesses? Failed economy? With a guarantee of what? Failure of the investment?



I'm not saying it's a good thing!
It's just a comment on 







> I hope they considered possible consequences.



Showing how stimulitory that consequence could be.

Just taking money from the people is worthy of an immediate overthrow in my opinion.
I would feel worthy of revolt on the basis that I would not have voted for  unafordable social services and government spending and so on.


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## baby_swallow (18 March 2013)

Other EU members that did not adopt the euro currency must be smiling behind the scene.
They can print their own money to their hearts content, while countries using the euro are being drip-fed by the ECB with all these crazy strings attached.


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## skc (18 March 2013)

OK... I am over it. Here's why.



> There is a lot of outrage, much of it legitimate, about the radical decision to impose a one-off levy on depositors. But aside from those advocating default, it is not clear what could have been done to fix the problem.
> 
> Radical and unprecedented problems require the consideration and implementation of radical and unprecedented solutions. This is why the deposit levy may not be all bad.
> 
> ...




The market probably will be over it by the end of the week.


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## CanOz (18 March 2013)

skc said:


> OK... I am over it. Here's why.
> 
> 
> 
> The market probably will be over it by the end of the week.




I agree...i think the circumstances could be worse if they don't approve the plan.

CanOz


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## McLovin (18 March 2013)

skc said:


> OK... I am over it. Here's why.
> 
> 
> 
> The market probably will be over it by the end of the week.




I'm not sure why the market cares. AFAICS, the only issue is if this spread to other countries. But it doesn't seem to be.


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## notting (18 March 2013)

Probably a good idea to watch the Euro to see how universal the sentiment is regarding weather this is being considered as some kind of precedent.


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## CanOz (18 March 2013)

notting said:


> Probably a good idea to watch the Euro to see how universal the sentiment is regarding weather this is being considered as some kind of precedent.




Bond yields are the barometer for fear of contagion...

I posted the yields on the International Banter thread.

They're up, but the vote is not until 4PM Cyprus time...


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## skc (18 March 2013)

McLovin said:


> I'm not sure why the market cares. AFAICS, the only issue is if this spread to other countries. But it doesn't seem to be.




Of couse that is the only reason that the market cares. It appears to set a bad precedence that a multi-meta-national body can violate basic property rights that is taken for granted in a capitlist society.

What is easily forgotten, however, is that bank deposits are actually funds within the capital structure of a bank. 

As the banks are being restructured essentially, various layers of the capital structure will be affected. Whether it is fair or legal, that's another matter.

Plus the fact that Cyprus is so tiny... that's why I don't expect the reaction to last too long.


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## Caveman (18 March 2013)

pilots said:


> R U 4 real????? bet you voted for the ALP, its the RICH and WEALTHY that employ people,  we need the rich and wealthy.




I think he`s just reacting to GG`s post.
But this bail out the banks thing is getting just a bit too convenient especially when the the go ahead is given from another country.


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## So_Cynical (18 March 2013)

Julia said:


> Your entrenched sense of envy toward anyone with more money or perhaps just more ability to save and/or generate money than yourself is so extreme that it renders you irrational.




LOL .. The extreme irrationality of poverty.  Cos only wealthy people are rational...hey 

But seriously, Cyprus is Broke along with maybe a quarter of Europe, the people will pay one way or another, ask the Irish or Greeks if they are paying? suffering the consequences of being broke...i think the Cypriot Govt is being a lot more decisive and up front about it.



Julia said:


> It's not just the group that you would consider to be the idle rich who would be affected by this.




And yet it is without any doubt the rich who will pay the most.




prawn_86 said:


> Yep it is the middle class that will be hit hardest. Or even those poor with a couple thousand int he back will still be slugged nearly 7%.
> 
> I dont see how you can think it is a good idea SC. What if someone had been saving for a medical expense (something like you are i beleive) and suddenly the gov takes 7% of that off you?




Meh...if it happened here im down 900 bucks (mostly cos i paid out the line of credit and CC's ) and im saving for a medical procedure that's going to happen in the Philippines at a third of the Aussie price, i give up on the the Aussie non emergency medical system, The doctors are all millionaires, the Nurses pull 6 figures and all the diagnostic places make a fortune...all at our expense.

My 7 x 11 mm Polyp isn't good/bad enough to even make the public waiting list, yet a professor told me he can take it straight out for 4K after Medicare, Its disgusting...the public surgeon says "why perform unnecessary surgery" :dunno: and yet the Professor who taught him has no issue with the unnecessariness of it.


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## notting (18 March 2013)

So_Cynical said:


> i think the Cypriot Govt is being a lot more decisive and up front about it.




It's hard not too be upfront when it's either that, or bankruptcy tomorrow, literally!


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## skc (18 March 2013)

So_Cynical said:


> My 7 x 11 mm Polyp isn't good/bad enough to even make the public waiting list, yet a professor told me he can take it straight out for 4K after Medicare, Its disgusting...the public surgeon says "why perform unnecessary surgery" :dunno: and yet the Professor who taught him has no issue with the unnecessariness of it.




Completely off topic.. I don't know what a 7x11mm Polyp is, but is this what you plan to go to Phillipines to do? Or is it something else. Cause $4k is a pretty cheap procedure... that's like one stock position for you isn't it?


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## So_Cynical (18 March 2013)

skc said:


> Completely off topic.. I don't know what a 7x11mm Polyp is, but is this what you plan to go to Phillipines to do? Or is it something else. Cause $4k is a pretty cheap procedure... that's like one stock position for you isn't it?




I'm going to be in the Philippines anyway and the Hospital is just down the road, so its an easy option...while 4K is my current entry position size its not something i want to use on a Polyp, at least in the market i have a 4 out of 5 chance of profiting, with the Polyp its a goner and i don't even get a capital loss!!! even though it is a capital loss.

Lost from my pocket into a millionaires.


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## Tyler Durden (18 March 2013)

McLovin said:


> I'm not sure why the market cares. AFAICS, the only issue is if this spread to other countries. But it doesn't seem to be.




But that's the big secondary concern here - people in Greece, Spain and Italy will be thinking "uh oh, what if we're next? Better pull my money out now!" and there starts the domino's effect.


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## CanOz (18 March 2013)

> (CY) Cyprus said to have cancelled today's Parliament vote as it seeks more negotiations over bailout package - financial press citing State run broadcaster CYBC- Vote now expected on Tuesday, Mar 19th at 10:00 ET (14:00 GMT) - Source TradeTheNews.com




Markets don't like uncertainty...


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## skc (18 March 2013)

So_Cynical said:


> I'm going to be in the Philippines anyway and the Hospital is just down the road, so its an easy option...while 4K is my current entry position size its not something i want to use on a Polyp, at least in the market i have a 4 out of 5 chance of profiting, with the Polyp its a goner and i don't even get a capital loss!!! even though it is a capital loss.
> 
> Lost from my pocket into a millionaires.




There are risks to all medical procedures and it scares me to save a few $k and get an operation in a 3rd world country. At least if they screw up in Australia you can sue those millionaires.

Anyway... good luck with it.

Back on topic.

Seems like panic is pretty much over and Europe is well off the lows.


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## Julia (18 March 2013)

skc said:


> The market probably will be over it by the end of the week.



Who cares about the affected depositors, as long as the market will be OK in a few days, huh?
Fantastic.



So_Cynical said:


> I'm going to be in the Philippines anyway and the Hospital is just down the road, so its an easy option...while 4K is my current entry position size its not something i want to use on a Polyp, at least in the market i have a 4 out of 5 chance of profiting, with the Polyp its a goner and i don't even get a capital loss!!! even though it is a capital loss.
> 
> Lost from my pocket into a millionaires.



Well, if you'd spent the considerable funds required to acquire a basic medical degree, done all those years of study, and then spent about another six years to acquire a specialist ENT qualification, you'd bloody well be earning a similar amount.
Your quibbling about people who have achieved something useful in life is nauseating.



skc said:


> There are risks to all medical procedures and it scares me to save a few $k and get an operation in a 3rd world country. At least if they screw up in Australia you can sue those millionaires.



Agree.  A decision that could only come from someone who values money more than their health.


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## McLovin (18 March 2013)

Tyler Durden said:


> But that's the big secondary concern here - people in Greece, Spain and Italy will be thinking "uh oh, what if we're next? Better pull my money out now!" and there starts the domino's effect.




Well it's 1:45pm in Athens and 12:45pm in Rome and Madrid. If they're not queuing already they aren't going to.


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## skc (18 March 2013)

Julia said:


> Who cares about the affected depositors, as long as the market will be OK in a few days, huh?
> Fantastic.




Did you read the Business Spectator article that I linked? 

http://www.businessspectator.com.au/...#ixzz2NrxmDwpS

Which aspect of the article do you agree / disagree with?

What alternative do you propose?


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## Julia (18 March 2013)

skc said:


> Did you read the Business Spectator article that I linked?
> 
> http://www.businessspectator.com.au/...#ixzz2NrxmDwpS



No.  When I attempt to access your link, I'm told that 'access is denied'.

My own email of Business Spectator today has this article:
http://www.businessspectator.com.au...l&utm_content=238868&utm_campaign=kgb&modapt=

It sums up my sentiments exactly.




> What alternative do you propose?



No idea.  I am not an economist or a politician.  I just take exception to the deposits of ordinary people being swiped to make up for government and bank mismanagement.

Perhaps the salaries and super of politicians and others who were responsible for creating the mess could be accessed as a start.  Perhaps watch tonight's 4 Corners for how the 'too big to prosecute' have got away with so much.


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## skc (19 March 2013)

Julia said:


> No.  When I attempt to access your link, I'm told that 'access is denied'.
> 
> My own email of Business Spectator today has this article:
> http://www.businessspectator.com.au...l&utm_content=238868&utm_campaign=kgb&modapt=
> ...




Try this link again if you are interested.
http://www.businessspectator.com.au...two-options-misery-or-suffering#ixzz2NrxmDwpS

The way I see it is that the situation sounds bad initially but ultimately it is the same as other forms of tax increase, austerity or even inflation. The consequence is that the private citizens' purchasing power is reduced. 

The Australian government had a one-time QLD flood levy in 2011. I paid my share but I was not offered any choice or consulted in the process. The economic impact to me would be the same had they simply take the same amount from my bank account. But they called it a tax/levy and took it out of people's pay instead. The situation and cause are slightly different, but the economic consequences are similar. Yet somehow a flood levy doesn't sound nearly as dramatic as a disposit levy.


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## Aussiejeff (19 March 2013)

McLovin said:


> Well it's 1:45pm in Athens and 12:45pm in Rome and Madrid. If they're not queuing already they aren't going to.




Apparently the banks have been ordered to shut all cash outlets for the next 2 days to prevent a run. What happens after that? Another order to prevent withdrawals indefinitely? :bad:


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## ASICK (19 March 2013)

Aussiejeff said:


> Apparently the banks have been ordered to shut all cash outlets for the next 2 days to prevent a run. What happens after that? Another order to prevent withdrawals indefinitely? :bad:




It's all about trust - without trust, there is nothing.


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## Tyler Durden (19 March 2013)

McLovin said:


> Well it's 1:45pm in Athens and 12:45pm in Rome and Madrid. If they're not queuing already they aren't going to.




How do you know they're not already queuing?


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## nulla nulla (19 March 2013)

So_Cynical said:


> LOL .. The extreme irrationality of poverty.  Cos only wealthy people are rational...hey
> 
> But seriously, Cyprus is Broke along with maybe a quarter of Europe, the people will pay one way or another, ask the Irish or Greeks if they are paying? suffering the consequences of being broke...i think the Cypriot Govt is being a lot more decisive and up front about it.
> 
> ...




Sorry to hear of your condition SC. I hope the procedure goes well for you and the polyp proves to be benign.

In respect of the Cyprus Deposit Tax. In my humble opinion the EU has not thought through the ramifications of forcing a small member country to impose a 10% tax on deposits as part of their bailout conditions. It is apparent that the tax will not only cause a run on the Cyprus banks but the fear factor will ensure that there is a run on the banks of every other member country that is doing it tough. Their decision to impose this tax will ascerbate the situation and not cure it. Just another example of EU incompetence.


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## McLovin (19 March 2013)

Tyler Durden said:


> How do you know they're not already queuing?




I read the news.


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## FlyingFox (19 March 2013)

skc said:


> The way I see it is that the situation sounds bad initially but ultimately it is the same as other forms of tax increase, austerity or even inflation. The consequence is that the private citizens' purchasing power is reduced.




It's not the same. This is a tax on savings and not on income. It negatively affects anyone who chooses to save money and not indebted. 

E.g I have 2 million in the bank, I get charged a 200K tax. You have a 2 million in property/equity/or stashed gold, no tax for you.


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## FlyingFox (19 March 2013)

So_Cynical said:


> Lost from my pocket into a millionaires.




If you're assuming your money is going to the poor doctor's in Philippines, your sadly mistaken. Some of the richest people I have met have been doctors from "third world countries".

BTW if you want anyone to blame, blame the capitalist system (and the fact that you can sue your doctor)!


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## McLovin (19 March 2013)

FlyingFox said:


> It's not the same. This is a tax on savings and not on income. It negatively affects anyone who chooses to save money and not indebted.
> 
> E.g I have 2 million in the bank, I get charged a 200K tax. You have a 2 million in property/equity/or stashed gold, no tax for you.




If you had $2m in the bank would you prefer paying 10% and saving the bank or losing it all?


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## FlyingFox (19 March 2013)

McLovin said:


> If you had $2m in the bank would you prefer paying 10% and saving the bank or losing it all?




That is a completely different question and not the point I was making. 

Essentially savers are being punished for the mistakes of governments, banks and bankers. Why aren't those who caused these problems being punished?

I guess your the exception to the rule if you save these days. That's the message I am getting.


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## notting (19 March 2013)

FlyingFox said:


> That is a completely different question and not the point I was making.




It is the question that reality is presenting them.



FlyingFox said:


> Essentially savers are being punished for the mistakes of governments, banks and bankers.




Really? 
I suppose that could be true if those savers paid their taxes and voted with the benefit of the country as a whole rather than what might fatten their wallets regardless of what it would do to the country.
Other wise they are just getting what they had coming to them.


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## McLovin (19 March 2013)

FlyingFox said:


> That is a completely different question and not the point I was making.




It's the only relevant question. The banking system in Cyprus is broke and the Cypriot government doesn't have anywhere near enough money to rescue it. So the golden rule applies. 

Why should taxpayers from Northern Europe be expected to foot bill? If they don't, of course, then the Cypriot depositors will have accounts worth substantially less than x-10%.

I absolutely understand why the Germans et al aren't interested in bailing out a banking system that operated largely as a Russian laundromat.


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## FlyingFox (19 March 2013)

notting said:


> It is the question that reality is presenting them.




I agree. But the point I made was in relation to comment that this is just another form of taxation. I think this can't be seen as another form of taxation because it is double for those, assuming that they have paid their taxes,  who save and none for those who spend it all or borrow. 





notting said:


> Really?
> I suppose that could be true if those savers paid their taxes and voted with the benefit of the country as a whole rather than what might fatten their wallets regardless of what it would do to the country.
> Other wise they are just getting what they had coming to them.




This is my point. Amongst those that are being taxed will be people that have paid their taxes and from what I have read others that have acquired their wealth in unscrupulous ways without paying taxes etc.

Do you really think the general populous will ever vote for what's right for their country? Look at Australia in the last decade.


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## FlyingFox (19 March 2013)

McLovin said:


> It's the only relevant question. The banking system in Cyprus is broke and the Cypriot government doesn't have anywhere near enough money to rescue it. So the golden rule applies.
> 
> Why should taxpayers from Northern Europe be expected to foot bill? If they don't, of course, then the Cypriot depositors will have accounts worth substantially less than x-10%.
> 
> I absolutely understand why the Germans et al aren't interested in bailing out a banking system that operated largely as a Russian laundromat.




No I don't think the banking system should be bailed out by other countries. All unscrupulous behaviour aside, do you think the savers of the country are to be blamed for the present predicament? Seems that they will be the only ones to suffer either way. To answer your question, I do agree with you that it is the lesser of the two evils.

The more important question is what sort of precedent does this set. I am sure there will be more banks and governments that will go down this road.


----------



## McLovin (19 March 2013)

FlyingFox said:


> All unscrupulous behaviour aside, do you think the savers of the country are to be blamed for the present predicament?




No. But I think who's to blame is entirely irrelvant at this point. Cyprus is where it is and no amount of blame or punishment will reverse previous mistakes or malfeasance.



FlyingFox said:


> The more important question is what sort of precedent does this set. I am sure there will be more banks and governments that will go down this road.




I highly doubt it.


----------



## explod (19 March 2013)

FlyingFox said:


> The more important question is what sort of precedent does this set. I am sure there will be more banks and governments that will go down this road.




Yes it sets a precedent and in a sense will now be regarded as a direct emergency form of tax.

Money in the bank system was lost to depositors forever in Argentina in the 1990's, all types of bonds collapsed in the Great Depression.  The Russian's hold half of the money in the Cyprus banking system and just watch the shenanigans as they try to get it all out.

Where debt levels continue to grow beyond respective gross domestic production this rot will continue to escalate.



> A policy of raiding citizens bank accounts will undermine every countries financial system and central bank and it sets a dangerous precedent. How will Spanish savers greet negotiations with the IMF and how will they begin to withdraw their savings from the already fragile Spanish banking system.
> Once again the ECB, the IMF and the EU elites have looked after the interests of banks and institutions over those of the ordinary people. Corporatism is alive and well and it threatens our banking systems and capitalism itself which cannot function without a healthy banking system.




From Harvey Organ today (about half way through):  http://harveyorgan.blogspot.com.au/


----------



## CanOz (19 March 2013)

McLovin said:


> It's the only relevant question. The banking system in Cyprus is broke and the Cypriot government doesn't have anywhere near enough money to rescue it. So the golden rule applies.
> 
> Why should taxpayers from Northern Europe be expected to foot bill? If they don't, of course, then the Cypriot depositors will have accounts worth substantially less than x-10%.
> 
> I absolutely understand why the Germans et al aren't interested in bailing out a banking system that operated largely as a Russian laundromat.




Agree....

Some facts

1.) The bulk of the savings is not from the islands "savers". 
2.) They're trying to work out a deal that affects the locals less and hits the wealthy tax avoiding Russians a little more, for the benefit of Cyprus and possibly the EU.
3.) Cyprus banks got into this situation by taking a haircut on the Greek bonds. 
4.) If they don't do this, Cyprus will descend into chaos and there could be contagion for EU.
5.) It was certainly a political decision, the Germans are not going to bail out Cyprus.

In the meantime, the return of volatility!

CanOz


----------



## FlyingFox (19 March 2013)

McLovin said:


> No. But I think who's to blame is entirely irrelvant at this point. Cyprus is where it is and no amount of blame or punishment will reverse previous mistakes or malfeasance.




It maybe irrelevant at this point in time and possibly to Cyprus but it is the most relevant question going forward. This is advocating that no matter what governments do or how banks screw up , they will be propped up. Not only that but if you have savings, you will be the first one targeted.



McLovin said:


> I highly doubt it.




Regardless of whether it happens or not, people have/will loose trust in the system. And like you said, the current situation can't be reversed. What is the same happens in Italy and Spain?


----------



## CanOz (19 March 2013)

An article from the Economist on the "Bail In"...

CanOz


----------



## McLovin (19 March 2013)

FlyingFox said:


> It maybe irrelevant at this point in time and possibly to Cyprus but it is the most relevant question going forward. This is advocating that no matter what governments do or how banks screw up , they will be propped up. Not only that but if you have savings, you will be the first one targeted.




Bank is propped up by taxpayers or deposit holders lose everything

Bank is propped up by taxpayers and deposit holders lose a small amount of their funds on deposit or they lose everything.

See the quandry? Either way taxpayers pay. Shouldn't the people most directly affected bear a higher proportion of the cost? Deposit holders aren't some sacred cow that needs to be protected no matter the cost borne by the rest of society.


----------



## drsmith (19 March 2013)

The fundamental problem with taxing bank account balances in this way is that is that it encourages savers to withdraw it and stuff it under the bed or elsewhere beyond the reach of the taxing authority. It reduces confidence in the security of bank deposits overall.

A floating currency is a much better form of economic adjustment.


----------



## explod (19 March 2013)

McLovin said:


> Deposit holders aren't some sacred cow that needs to be protected no matter the cost borne by the rest of society.




Strewth, would you care to read back what you just said, 

or perhaps can you elaborate on that ?


----------



## Julia (19 March 2013)

McLovin said:


> No. But I think who's to blame is entirely irrelvant at this point.



I disagree.  It is less about reversing previous mistakes and more about setting a precedent for the future. 
From the start of the GFC we have seen example after example of the moral hazard of the people causing the whole mess getting away with the results of their greed and exploitation.   



FlyingFox said:


> It maybe irrelevant at this point in time and possibly to Cyprus but it is the most relevant question going forward. This is advocating that no matter what governments do or how banks screw up , they will be propped up. Not only that but if you have savings, you will be the first one targeted.
> 
> Regardless of whether it happens or not, people have/will loose trust in the system. And like you said, the current situation can't be reversed. What is the same happens in Italy and Spain?



Exactly.
Philip Lowe's comments this morning (RBA)


> More from the RBA speech this morning. Dr Philip Lowe said he had been very surprised by plans to tax depositors in Cyprus as part of a bailout package and saw it as a step back for the region.
> 
> Answering questions after a speech, Reserve Bank of Australia (RBA) Deputy Governor Philip Lowe said the plans for a tax threatened integrity of deposits generally and could lead to runs on banks in other euro zone countries where bailouts might be needed.






McLovin said:


> Deposit holders aren't some sacred cow that needs to be protected no matter the cost borne by the rest of society.



You seem to be dismissing the collective psychological impact of the message now that money in the bank is no longer safe.  The potential ramifications of such a loss of trust could be considerable imo.



skc said:


> Try this link again if you are interested.
> http://www.businessspectator.com.au...two-options-misery-or-suffering#ixzz2NrxmDwpS



Thank you:  that link worked.  From Mr Koukoulas's article:


> The decision to tax savings has lead to a range of criticisms, particularly as savings are the antithesis of the whole problem and sovereign debt holders have not had to endure a similar hair cut. This is the main problem with the deposit levy as those active players in the whole crisis such as the hedge funds, banks and other bond holders are getting away scot-free it seems.




This is my point.  I'm entirely sympathetic to the German taxpayer having had more than enough of shouldering the responsibilities of the profligacy of other countries, but just do not believe taxing depositors is the only way to deal with it.  Whack huge taxes on alcohol, cigarettes, luxury foods, cars, petrol etc, but 10% is a hell of an impost on what would in some cases be a lifetime of diligent saving.  People who have money in bank deposits are, by and large, more conservative and risk averse than those who would have channeled similar funds into areas seen as more risky.  The loss of trust and sense of fear that can spread as a result of this is potentially harmful as well as morally bankrupt imo.

There seems to be some discussion around whether it's possible to tax more heavily the foreign deposits in Cyprus, thus avoiding the unfair penalty on small individual local savers.  I hope that can be worked out.



> The way I see it is that the situation sounds bad initially but ultimately it is the same as other forms of tax increase, austerity or even inflation. The consequence is that the private citizens' purchasing power is reduced.



No.  The consequence is that the purchasing power of *savers, specifically,* is reduced, that they are to be punished for their caution and diligence.



> The Australian government had a one-time QLD flood levy in 2011. I paid my share but I was not offered any choice or consulted in the process. The economic impact to me would be the same had they simply take the same amount from my bank account. But they called it a tax/levy and took it out of people's pay instead. The situation and cause are slightly different, but the economic consequences are similar. Yet somehow a flood levy doesn't sound nearly as dramatic as a disposit levy.



It hardly compares!
Someone earning over $100K was levied a one off mere 1% just on those earnings.  That's a completely different principle from a tax on savings.


----------



## McLovin (19 March 2013)

explod said:


> Strewth, would you care to read back what you just said,
> 
> or perhaps can you elaborate on that ?




Cyprus is broke. The banks are broke. The cost will be borne by society as a whole, through higher taxes and less public services. Bailing out the banks amounts to a transfer from the public purse to private individuals (ie creditors, including depositors). Under the scenario where the government is broke, is it really fair to expect taxpayers to bail out foreigners who have money on deposit? Or even fair to expect taxpayers to foot the entire bill for domestic depositors?

I don't see why under the conditions Cyprus finds itself in it's such a burden to expect people to contribute to save their own skin. The alternatives are far more grim.


----------



## McLovin (19 March 2013)

Julia said:


> You seem to be dismissing the collective psychological impact of the message now that money in the bank is no longer safe.  The potential ramifications of such a loss of trust could be considerable imo.




Not dismissing it, I just don't think there is an _absolute_ guarantee and given the size of the bailout it's pretty unrealistic to expect one (see: Iceland, 2009). Bank deposits in Cyprus are ~7-8x GDP. To put that in perspective, that would mean the Australian banks had deposits of $9.75 trillion (as opposed to the $1.5 trillion they actually do) and the current bailout would amount to about ~$750 billion, or 57% of GDP.

At some point the cost to the country outweighs any psychological benefit.


----------



## skc (19 March 2013)

Julia said:


> It hardly compares!
> Someone earning over $100K was levied a one off mere 1% just on those earnings.  That's a completely different principle from a tax on savings.




Government has the power to take money from the public... either through taxes, reduced welfare, deliberate inflation or "direct debit" of bank accounts. The economic consequence is the same, and each of these methods will hurt some subset of the public. 

Cast aside the notion that savers are for some reason more sacred than tax payers or welfare recipients, and ignore the quantum of the two levies (as they are trying to address problems of different magnitude) you will find there are more similarities than differences. They are both one-off levies, they are both imposed on the public (a different subset of the public), and they are both done as extraordinary measures to address issues elsewhere in the system.


----------



## CanOz (19 March 2013)

Looks like it may not happen, the markets ain't gonna be happy 'bout that!!




> (CY) Cyprus govt spokesperson Stylianides: Cyprus parliament will not approve bank deposit levy, trying to find ways to mitigate burden on depositors - Source TradeTheNews.com


----------



## FlyingFox (19 March 2013)

McLovin said:


> Bank is propped up by taxpayers or deposit holders lose everything
> 
> Bank is propped up by taxpayers and deposit holders lose a small amount of their funds on deposit or they lose everything.




Let me ask you this. Why is the banking sector in trouble in the first place?




McLovin said:


> See the quandry? Either way taxpayers pay. Shouldn't the people most directly affected bear a higher proportion of the cost? Deposit holders aren't some sacred cow that needs to be protected no matter the cost borne by the rest of society.




Neither are investment bankers ... but they seem to get away with it...


----------



## FlyingFox (19 March 2013)

skc said:


> Government has the power to take money from the public... either through taxes, reduced welfare, deliberate inflation or "direct debit" of bank accounts. The economic consequence is the same, and each of these methods will hurt some subset of the public.




Can you please explain how it is the same? It may have the same economic impact but by no means is it the same.



skc said:


> Cast aside the notion that savers are for some reason more sacred than tax payers or welfare recipients, and ignore the quantum of the two levies (as they are trying to address problems of different magnitude) you will find there are more similarities than differences. They are both one-off levies, they are both imposed on the public (a different subset of the public), and they are both done as extraordinary measures to address issues elsewhere in the system.




I don't have a problem with your premise. Look at QLD flood levies which was charged on income. Fair on everyone as everyone earning paid the levy. The current arrangement equates to double taxation and only on those having savings.


----------



## CanOz (19 March 2013)

FlyingFox said:


> Let me ask you this. Why is the banking sector in trouble in the first place?
> 
> 
> 
> ...




You guys are making this sounds like its something new, its not. This is all related to the blatant fraudulant activities of the darn banker/wankers in the first place...now someone's got to pay. Same thing happened in the US, except it was the tax payers on the hook there through bailouts, mind you the FDIC had to save the depositors there too (more taxpayer money). Over 100 banks collapsed during the GFC in the US alone. 

This is just a delayed reaction of all that prior contagion in Europe.

CanOz.


----------



## McLovin (19 March 2013)

FlyingFox said:


> Let me ask you this. Why is the banking sector in trouble in the first place?




What difference does it make? We're going around in circles.



FlyingFox said:


> Neither are investment bankers ... but they seem to get away with it...




OK. Not really sure what investment bankers have to do with retail deposit taking banks in Cyprus.


----------



## CanOz (19 March 2013)

McLovin said:


> What difference does it make? We're going around in circles.
> 
> 
> 
> OK. Not really sure what investment bankers have to do with retail deposit taking banks.




Well in all fairness the failure of the Greek banking system was at some point, blamed on activities by G. Sachs and Co., yeah?

Cyprus banks have big liabilities from the Greek bond losses, right?

CanOz


----------



## McLovin (19 March 2013)

CanOz said:


> Well in all fairness the failure of the Greek banking system was at some point, blamed on activities by G. Sachs and Co., yeah?
> 
> Cyprus banks have big liabilities from the Greek bond losses, right?
> 
> CanOz




Fair point. In any event, the whole IB thing has been done to death and doesn't change a thing for those in Cyprus.


----------



## ASICK (19 March 2013)

http://www.infowars.com/ceo-cyprus-bank-account-looting-could-blow-up-europe/

http://www.infowars.com/the-rape-of-cyprus-by-the-european-union-the-imf/

http://www.infowars.com/banking-chief-calls-for-15-looting-of-italians-savings/

http://www.infowars.com/proposed-cypriot-bank-deposit-theft-good-news-for-gold/

http://www.drudgereport.com/


----------



## CanOz (19 March 2013)

> (CY) Cyprus Green Party spokesperson Xanthou: No matter what happens in the parliament we will have a run on the banks when they reopen- tv interview - Source TradeTheNews.com




What an utterly useless thing to say...

CanOz


----------



## notting (19 March 2013)

I'd like to see Adam Bandt stand up now and praise cyprus for being a stunning example of the social benefits from making it hard for banks to profit.


----------



## demiser (19 March 2013)

skc said:


> The market probably will be over it by the end of the week.






McLovin said:


> I'm not sure why the market cares. AFAICS, the only issue is if this spread to other countries. But it doesn't seem to be.




Our market will get over it, but there's ?  Although the media is constantly using the term "savings accounts", what I believe they really mean is deposits, or basically any cash in the bank.

So yes, cash includes savings accounts, but it also covers day to day accounts for businesses, deposits paid to businesses, holding accounts for deceased estates, right down to the cash recently raised by fundraising.

I'm currently googling trying to trying to prove the above either way, so would be happy if anyone could clarify.

So although 9.9% would be a big hit to anyone, how would it affect an ongoing business ?


----------



## Tyler Durden (19 March 2013)

McLovin said:


> I read the news.




Did the news you read state that people weren't queuing?

Do you have the link?


----------



## Julia (19 March 2013)

skc said:


> Government has the power to take money from the public... either through taxes, reduced welfare, deliberate inflation or "direct debit" of bank accounts. The economic consequence is the same, and each of these methods will hurt some subset of the public.
> 
> Cast aside the notion that savers are for some reason more sacred than tax payers or welfare recipients,



No, I cannot.  Welfare recipients, many of whom have never made any attempt to look after their own outcomes and have a massive sense of entitlement that their fellow taxpayers will always prop them up, are absolutely not in the same category as savers.  To suggest the two categories are alike is just not reasonable imo.



CanOz said:


> You guys are making this sounds like its something new, its not. This is all related to the blatant fraudulant activities of the darn banker/wankers in the first place...now someone's got to pay.



Certainly, someone should pay.  But it should not be those people who have been diligent enough to save.

You, and others, seem to be suggesting it's all just fine that governments have grossly mismanaged their financial situations, yet those who are responsible get off with no consequent responsibility, this instead being sheeted home to small depositors.  What sort of moral and practical precedent does that convey?

You might as well say that our government here should equally feel entitled to raid the accounts of depositors in order to shore up their rapidly worsening economic position.


----------



## skc (19 March 2013)

FlyingFox said:


> Can you please explain how it is the same? It may have the same economic impact but by no means is it the same.
> 
> I don't have a problem with your premise. Look at QLD flood levies which was charged on income. Fair on everyone as everyone earning paid the levy. The current arrangement equates to double taxation and only on those having savings.




Why's a levy on income is fair, while a levy on saving is unfair? 

Suppose you earn $100k a year and have $100k in the bank account. A meteorite destroyed Canberra and the Government said we need to raise a one-time Canberra rebuilding levy. They hold a referendum and offer you two methods of collection... 10% additional tax on income, or 10% levy on deposit. Which one would you vote on? Or can you start to see how it is the same?

Suppose again... same situation with the Canberra rebuilding levy, but instead you have $100k income but only $50k in the bank account. Which method of levy collection would you vote for in the referendum?


----------



## Julia (19 March 2013)

It wasn't a 10% levy for the flood relief.  It was 1% if you were earning over $100K p.a.
A paltry $1000.

Very different from someone having gone without for decades to ensure security in old age with, say, $2M in deposit being slugged $200K.

I'm not going to argue back and forth about this.  It's pointless.
You have one view.  I have another.


----------



## notting (19 March 2013)

FlyingFox said:


> Do you really think the general populous will ever vote for what's right for their country?.




If you don't vote for what’s best for the community you live in but rather your own selfish interest such as irresponsible welfare promises or unfair employer strangling policies that make it impossible or a nightmare to employ people or early retirement payouts. Then you have given a green light for you consequent government to raid your bank account when ever they need to as far as I am concerned because you voted for the situation.

People gotta stop blaming the governments and big bad bankers and other big bad institutions.

I'll bet that the vast majority of the people who riot in Greece and so on are the greatest leaches voting for pork barrels.


----------



## FlyingFox (19 March 2013)

skc said:


> Why's a levy on income is fair, while a levy on saving is unfair?
> 
> Suppose you earn $100k a year and have $100k in the bank account. A meteorite destroyed Canberra and the Government said we need to raise a one-time Canberra rebuilding levy. They hold a referendum and offer you two methods of collection... 10% additional tax on income, or 10% levy on deposit. Which one would you vote on? Or can you start to see how it is the same?
> 
> Suppose again... same situation with the Canberra rebuilding levy, but instead you have $100k income but only $50k in the bank account. Which method of levy collection would you vote for in the referendum?




I would vote for income. Reason being the levy on income will affect everyone earning an income. This is much fairer than taxing only those who have savings.

Many more people are earning 100K than have 100K in bank deposits .....


----------



## qldfrog (19 March 2013)

CanOz said:


> What an utterly useless thing to say...
> 
> CanOz




but sadly probably true.


----------



## FlyingFox (19 March 2013)

notting said:


> If you don't vote for what’s best for the community you live in but rather your own selfish interest such as irresponsible welfare promises or unfair employer strangling policies that make it impossible or a nightmare to employ people or early retirement payouts. Then you have given a green light for you consequent government to raid your bank account when ever they need to as far as I am concerned because you voted for the situation.
> 
> People gotta stop blaming the governments and big bad bankers and other big bad institutions.
> 
> I'll bet that the vast majority of the people who riot in Greece and so on are the greatest leaches voting for pork barrels.




I agree . However, and this is the crux of it all, why are only savers targeted?

I do not believe in pork barrelling and I will not vote for a government that stands for it (that's why I abstain from voting). However I can't stop the rest of the smiths, jones or kumars from voting in idiots. They get their middle class welfare, baby bonuses and get to choke themselves on debt just so the economy keeps expanding.

Now if it all blows over, the government and banks can't fail so it's back to printing money or raiding bank accounts. The persons choking in debt gets a relief, house prices go up blah blah blah....we're saved. Now me, the diligent saver with money in the bank, it's worth much less or a portion of it has been taken away. Seems that it is wrong to save these days. No one else is doing it and by the responses received in this thread it almost sounds like it's a crime.


----------



## notting (19 March 2013)

qldfrog said:


> but sadly probably true.




Yes, but it's also true that the majority of Club Med Euroland is, in reality, bankrupt.

Just isn't the most constructive thing to say on the megaphone from the leadership pulpit, unless you intend to make it worse.


----------



## FlyingFox (19 March 2013)

skc said:


> Why's a levy on income is fair, while a levy on saving is unfair?
> 
> Suppose you earn $100k a year and have $100k in the bank account. A meteorite destroyed Canberra and the Government said we need to raise a one-time Canberra rebuilding levy. They hold a referendum and offer you two methods of collection... 10% additional tax on income, or 10% levy on deposit. Which one would you vote on? Or can you start to see how it is the same?
> 
> Suppose again... same situation with the Canberra rebuilding levy, but instead you have $100k income but only $50k in the bank account. Which method of levy collection would you vote for in the referendum?




You do realise that you have already paid all taxes on your savings right. People were up in arms about taxing super when taking money out of it etc not too long ago.

BTW have you ever been on the receiving end of anything like this? I am from Fiji and we had two 20% devaluations in the 2000's. Not a nice feeling.


----------



## notting (20 March 2013)

FlyingFox said:


> Now me, the diligent saver with money in the bank, it's worth much less or a portion of it has been taken away. Seems that it is wrong to save these days. No one else is doing it and by the responses received in this thread it almost sounds like it's a crime.




Getting a bit creative here, but it's interesting - 
If everyone put their money to work, it really does help things thrive so there is actually an argument for it.
The GFC was literally a freeze.  That was what the crises was!
So you can kind of see why this sneaky (seemingly mad) little effort to beat the sheep to scare the flock may not be as bonkers as it first looks.
There is huge amounts of money not been put to work at present.


----------



## FlyingFox (20 March 2013)

notting said:


> Getting a bit creative here, but it's interesting -
> If everyone put their money to work, it really does help things thrive so there is actually an argument for it.
> The GFC was literally a freeze.  That was what the crises was!
> So you can kind of see why this sneaky (seemingly mad) little effort to beat the sheep to scare the flock may not be as bonkers as it first looks.
> There is huge amounts of money not been put to work at present.




Creative no, emotional perhaps, far from the truth? I don't think so. No all this does is drive the money underground and into precious metals etc. This sets a precedent for the bad old days when people did not trust banks.

I disagree with your comment. If it is in the banks, it is up to the banks and the people who borrow to put it to work. If I wanted to take the risk myself, I would have invested myself. If I put in the bank for a relatively low but safe return, I expect it to be there at the end of the day. This is a choice the saver makes with very well known opportunity costs.

BTW I would argue that we got to the GFC because "everyone put their money (and more that they borrowed) to work" leading to overheating/bubble in many fronts. When this stopped, and it was a break down in trust due to the sub prime debacle, the flow of money stopped.


----------



## tinhat (20 March 2013)

CanOz said:


> Same thing happened in the US, except it was the tax payers on the hook there through bailouts,
> 
> CanOz.




Not to take the discussion off on a tangent, but that's the beauty of the USA. Ditching the gold standard but retaining world reserve currency status they've never really had to pay for anything. The tax payers there haven't paid for any of the bailout. The government increases its deficit, the fed prints the money. Someday the tax payer will have to pay but their day of reckoning hasn't arrived yet. 

Go through the annals of history and find me a state that managed to wage a long war and cut taxes at the same time (there aren't any) except that's what the USA did during the 2000s while George W and his mates used the cover of war to raid the treasury.  The USA has effectively been at war from since the 1940s in terms of military spending. (1990s after Gulf War I was probably the quietest period - just a few skirmishes here and there). Wars send countries broke. The USA won't be any exception.

But anyway, back to the pressing banking crisis of Cyprus...


----------



## notting (20 March 2013)

FlyingFox said:


> BTW I would argue that we got to the GFC because "everyone put their money (and more that they borrowed) to work" leading to overheating/bubble in many fronts. When this stopped, and it was a break down in trust due to the sub prime debacle, the flow of money stopped.




Yeah that's agreeable in my less creative opinion.

However the subprime thing was part of it, far from the main game.

Huge amounts of people had started starving all over the world due to unaffordable oil. (There was a food crises!!)
There were places where garbage wasn't even being collected because they would lose money running the truck.
Things just stopped, froze up, as you say, maybe too much liquidity in the wealthier economies.

What's kind of interesting now is the self sufficiency with energy going on in the US.
That's pretty damn bullish.
Peak oil is, now a big dumb myth.

Buy the dip! The Europeans will be more inclined to!


----------



## McLovin (20 March 2013)

Tyler Durden said:


> Did the news you read state that people weren't queuing?
> 
> Do you have the link?




Are you serious? Find me a news article that says people are queuing, if you can't then you can assume they're not. Do I need to find you an article that says the world wasn't invaded by aliens today for you to believe it?


----------



## McLovin (20 March 2013)

FlyingFox said:


> I agree . However, and this is the crux of it all, why are only savers targeted?




Different rates of taxation for different things are a fact of life. You buy a property you get hit with stamp duty and GST; buy shares you don't. Why are property investors targeted?

Why is someone living off their superannuation not taxed but someone living off their savings taxed?

The list goes on and on.


----------



## Tyler Durden (20 March 2013)

McLovin said:


> Are you serious? Find me a news article that says people are queuing, if you can't then you can assume they're not. Do I need to find you an article that says the world wasn't invaded by aliens today for you to believe it?




The inference I was trying to draw was people in Italy, Greece and Spain would see this and think it might happen to them, which would cause them to withdraw their money from banks. 

The inference you're trying to draw is people from those countries would witness Cyprus and not do the same.

All I'm trying to say my inference is the more reasonable one.

Oh, and by the way:



> It matters because lots of people are scared that the situation in Cyprus will spread ”” that Cypriots will take their money out of the bank en masse, which will cause people in Italy, Spain, Portugal, and other troubled EU countries to fear for the safety of their deposits as well, and start bank runs in their countries. That could lead to a continentwide financial crisis, and the fallout could hit markets in the U.S. As we saw during the last EU crisis, what happens in Europe doesn't stay in Europe for very long.




http://nymag.com/daily/intelligencer/2013/03/absolute-morons-guide-to-the-cyprus-bailout.html


----------



## qldfrog (20 March 2013)

the real question is:
if you had your saving in Spain,Italy, potentially France, (greeks have already done their bank run last year so not much there), what would be your decision?
I know mine.
Even worse, thinking about Australia, if by any disaster, labor is reelected, do you think you should leave considerable amounts in bank account or deposit?
'cause seizing a small amount directly from accounts above a threshold would have become by then an option.


One thing for sure, , it is a paradox that you are pushed nowadays to borrow and have debts, not to save, and we know where the GFC originated from...


----------



## prawn_86 (20 March 2013)

McLovin said:


> Different rates of taxation for different things are a fact of life. You buy a property you get hit with stamp duty and GST; buy shares you don't. Why are property investors targeted?
> 
> Why is someone living off their superannuation not taxed but someone living off their savings taxed?
> 
> The list goes on and on.




A tax on income is at least forward looking, a tax on savings penalizes those who have foregone certain things in their life to try and save. 

IE a tax on income will effect everyone equally from a start point, whereas a tax on savings will be dis-proportionate due to various different saving rates. It is also very unevenon business accounts depending on what sort of capital management, pay cycle, inventory etc etc each business has and the timing of their payments


----------



## No Trust (20 March 2013)

This is a joke, attacking innocent people's savings whilst the culprits of the GFC were bailed out to the tunes of billions and *no one ever prosecuted*...

When bank accounts are attacked in this manner people will keep it under the mattress which seems like a much safer option than giving it to crook bankers...

God help us if Ju"liar" is reelected, this may be something she would consider given her character and lies to date...


----------



## againsthegrain (20 March 2013)

So those with credit cards, debts and no savings don't get penalized for what they are responsible for. While those that spend cash that they do have and manage to put some on the side once again are hit. 

The rich and wealthy don't keep all their money in just one account in cash, they diversify, hold property, shares, businesses. Once again it will be the little guys that try to keep their head above water that get the crap deal.


----------



## YMI (20 March 2013)

Extra levy failed. Did they now decide to do what the Russians wanted? Are they perhaps paying better than the own government? I don’t think that was wise in the current situation.


----------



## notting (20 March 2013)

qldfrog said:


> labor is reelected




You have got to be joking

Guess they have voted to be bankrupt instead.  

This will be interesting Germany Vs Russia.


----------



## drsmith (20 March 2013)

YMI said:


> Extra levy failed. Did they now decide to do what the Russians wanted? Are they perhaps paying better than the own government? I don’t think that was wise in the current situation.



When will they be game enough to reopen Cypriot banks ?

It's pretty obvious as to what's going to happen when they do, regardless of what happens now with the deposit levy.

http://www.smh.com.au/business/worl...otes-against-deposit-levy-20130320-2geci.html


----------



## notting (20 March 2013)




----------



## YMI (20 March 2013)

drsmith said:


> When will they be game enough to reopen Cypriot banks ?
> 
> It's pretty obvious as to what's going to happen when they do, regardless of what happens now with the deposit levy.



I agree and I am a bit worried about the consequence of a bank run and bankrupt Cyprus. This will affect not only Europe.



notting said:


> ...



Vladimir looking at a gun, funny photo


----------



## McLovin (20 March 2013)

Tyler Durden said:


> The inference I was trying to draw was people in Italy, Greece and Spain would see this and think it might happen to them, which would cause them to withdraw their money from banks.
> 
> The inference you're trying to draw is people from those countries would witness Cyprus and not do the same.
> 
> All I'm trying to say my inference is the more reasonable one.




Given that they're not queuing outside banks, surely it's more reasonable to assume they won't, rather than they will.



			
				Tyler Durden said:
			
		

> Oh, and by the way:




So, some journalist in NY hypothesises about what *might* happen and this is important because?


----------



## FlyingFox (20 March 2013)

McLovin said:


> Given that they're not queuing outside banks, surely it's more reasonable to assume they won't, rather than they will.
> 
> 
> 
> So, some journalist in NY hypothesises about what *might* happen and this is important because?




When was the last time you queued at a bank to do your banking? 
Do you expect the foreigners with the large bank deposits to be physically queuing?

You can have a 100K people queuing at the bank to withdraw a 1000 euro each or just few TT'ing 10 of million out.....


----------



## notting (20 March 2013)

FlyingFox said:


> Do you expect the foreigners with the large bank deposits to be physically queuing?



They may be not queuing at the banks but I'm hearing from the ground that Taxi drivers at Cyprus airport are reporting things like "My last 3 customers where Russian coming to get their money!!!"


----------



## FlyingFox (20 March 2013)

notting said:


> They may be not queuing at the banks but I'm hearing from the ground that Taxi drivers at Cyprus airport are reporting things like "My last 3 customers where Russian coming to get their money!!!"




Which was probably brought to them (their representatives I assume) at the airport in person by the bank managers in what ever currency or form they desired....or is that too creative lol.....

Like I said you don't need a queue....just a few people withdrawing the millions.....


----------



## notting (20 March 2013)

See what you mean.
There Queuing at the ATMs not the Tellers, especially when they find one that still has money in it!


----------



## FlyingFox (20 March 2013)

notting said:


> View attachment 51394
> 
> 
> See what you mean.
> There Queuing at the ATMs not the Tellers, especially when they find one that still has money in it!




Question is, will this be repeated in other troubled euro-zone countries? The world?


----------



## McLovin (20 March 2013)

FlyingFox said:


> When was the last time you queued at a bank to do your banking?
> Do you expect the foreigners with the large bank deposits to be physically queuing?
> 
> You can have a 100K people queuing at the bank to withdraw a 1000 euro each or just few TT'ing 10 of million out.....




What foreigners? Cyprus was an outlier in terms of the relative size and composition of its deposit base. And their foreign liabilities were only a function of a "look the other" way mentality when Ivan or Vlad turned up with a suitcase full of money. Italy/Greece/Spain all run an overwhelmingly domestic deposit base.

Anyway, this thread is going the way of so many others on ASF where the doomsdayers will start chattering amongst themselves. Enjoy.


----------



## Tyler Durden (20 March 2013)

McLovin said:


> Given that they're not queuing outside banks




You don't know that.


----------



## McLovin (20 March 2013)

Tyler Durden said:


> You don't know that.




FFS mate, use some common sense. If it was happening it would be on the front page of every news organisation's website.


----------



## qldfrog (20 March 2013)

McLovin said:


> FFS mate, use some common sense. If it was happening it would be on the front page of every news organisation's website.



McLovin, I usually like your input so no personnal attack here but two facts:
1) bank are closed and accounts locked at the moment so you will not see a queue is the street, so no photo for the headlines in Cyprus;
2) from what I have read, more than a third of the money there is russian (mafia?) and one of the reason the EU was keen on the "levy" was it was seen as dirty money;
what do you think these russian mafioso or not will do in the next week if they can?
They will move out
this money gone will need to be replaced by either another EU gift or the country system collapses.
What about other investors still in the PIGS? they have to run as fast as possible...but they will not queue at the teller, this is done overnight via bank wire internet.
Only the local small fry will queue but for what if you are italian or spanish, you still need to have an account to pay your rent, etc so do not expect front line until it is far too late

IMHO, the effect is these country will never get a cent from O/S (ie non EU) anymore
and that is the beginning of the end for them and within a few month Euro in the worst case scenario.


----------



## CanOz (20 March 2013)

qldfrog said:


> McLovin, I usually like your input so no personnal attack here but two facts:
> 1) bank are closed and accounts locked at the moment so you will not see a queue is the street, so no photo for the headlines in Cyprus;
> 2) from what I have read, more than a third of the money there is russian (mafia?) and one of the reason the EU was keen on the "levy" was it was seen as dirty money;
> *what do you think these russian mafioso or not will do in the next week if they can?
> ...




QLD, they froze the assets. They froze everything according to the first proposal. I can't imagine them releasing the funds until they agree on plan B.



CanOz


----------



## McLovin (20 March 2013)

qldfrog said:


> McLovin, I usually like your input so no personnal attack here but two facts:
> 1) bank are closed and accounts locked at the moment so you will not see a queue is the street, so no photo for the headlines in Cyprus;
> 2) from what I have read, more than a third of the money there is russian (mafia?) and one of the reason the EU was keen on the "levy" was it was seen as dirty money;
> what do you think these russian mafioso or not will do in the next week if they can?
> ...




Qld

I wasn't actually talking about queues in Cyprus, it was queues in other peripheral countries like Italy/Spain/Greece. 

Firstly, as I mentioned in a previous post, Cyprus is an outlier and not typical of the other PIIGS banking systems in both its relative size and the composition of the deposit base (700% of GDP and ~50% foreign deposits). Just the amount of Greek bonds the banks had on their balance sheet amounted to 130% of Cyrpus' GDP. That's why its highly unlikely that the EU would need to haircut depositors in other countries, IMO.

Secondly, unless the average Italian/Spaniard/Greek has a foreign bank account (which is likely as an Australian having one), there is nowhere for them to move their money that would prevent it being taxed (if that was to occur) except to withdraw cash. So a bank run would absolutely involve people queuing to withdraw cash, not simply eft.

Re Cyprus' banks. I don't know what will happen, but I wouldn't be surprised if the Russian money stays in Cyprus. It's hard for to go anywhere else, and when you've acquired your cash by less than legal means, 10% isn't such a bad haircut to take.

Anyway, I think it's time for me to bow out of this thread.


----------



## skc (20 March 2013)

qldfrog said:


> 2) from what I have read, more than a third of the money there is russian (mafia?) and one of the reason the EU was keen on the "levy" was it was seen as dirty money;
> what do you think these russian mafioso or not will do in the next week if they can?
> They will move out
> this money gone will need to be replaced by either another EU gift or the country system collapses.




Bank runs are liquidity events but not in itself a solvency event. The Cyprus government has asked for unlimited liquidity to be provided as part of the condition to the bail-in, in anticipation of a bank run.



Tyler Durden said:


> You don't know that.




Absence of proof is proof of absence in this case. Unless there's a media cover up over 200 million people in the PIIGS.


----------



## notting (21 March 2013)

Just when you thought it was  safe to go back into the market-






> Regarding the one off levy on deposits BELOW 100.000 â‚¬: The Euro Commission made it clear in the Eurogroup* BEFORE* the vote in the Cypriot parliament, that an alternative solution respecting the financing parameters would be acceptable, preferably without a levy on deposits below 100.000 â‚¬. The Cypriot authorities did not accept such an alternative scenario.


----------



## ASICK (22 March 2013)

http://www.infowars.com/the-cyp-riots-begin/


----------



## Tyler Durden (24 March 2013)

skc said:


> Absence of proof is proof of absence in this case. Unless there's a media cover up over 200 million people in the PIIGS.




With respect, I must disagree. Just because something doesn't appear on the news doesn't mean it's not happening.


----------



## Buckfont (24 March 2013)

More from Jim Sinclair/Eric King blog.

http://kingworldnews.com/kingworldn...Roberts_-_Cyprus_May_Dwarf_2008_Collapse.html


----------



## FlyingFox (24 March 2013)

Buckfont said:


> More from Jim Sinclair/Eric King blog.
> 
> http://kingworldnews.com/kingworldn...Roberts_-_Cyprus_May_Dwarf_2008_Collapse.html




Great article. I didn't realise that the European union was trying to reclassify depositors as lenders to the bank. Would this then apply to the rest of the EU or is it a special case for Cyprus?

BTW here is Steve Keen's take on it http://www.debtdeflation.com/blogs/2013/03/19/eus-cyprus-madness-should-be-resisted/.


----------



## Garpal Gumnut (24 March 2013)

The Cyprus situation will lead to a run on banks in all South European countries.

Even the Poms are advising travellers to Cyprus to watch out for thieves if going to Cyprus and to take cash on holidays.

Cyprus is a kleptocracy, holding money for Russian oligarchs and brigands, with an impoverished population serving at their table.

gg


----------



## CanOz (24 March 2013)

> (CY) Cyprus and Troika *agree on a 20% levy on deposits above â‚¬100K at Bank of Cyprus *(largest bank) and 4% levy above â‚¬100K at all other banks; Deal still needs to be approved by Cyprus Parliament - financial press - Source TradeTheNews.com




Just guessing here but would that bank be the one where the bulk of the Russkies funds are?

CanOz


----------



## Tyler Durden (24 March 2013)

Buckfont said:


> More from Jim Sinclair/Eric King blog.
> 
> http://kingworldnews.com/kingworldn...Roberts_-_Cyprus_May_Dwarf_2008_Collapse.html




Thanks for the link, I must say I disagree with this:



> “No, I don’t by that definition at all that you are a lender to a bank.  In fact, for centuries now, the reason that people have deposited money in a bank, rather than keeping it under the mattress, is you are putting it there for safekeeping. The fact that the bank may then use the money to lend on elsewhere is their business, not yours."




I always understood that when we put our money into the ban, we are in fact lending it to them.

1. This would explain why the statements are in terms of debit and credit, as it is an account payable for them and account receivable for us.

2. We get paid interest on the money we deposit. If we put $5000 into a safety deposit box, we would not get anything for that.

3. They lend out our money to others. If I put my car at a car park for safe keeping, then they can't touch or use it. But if I park it there and agree to let them hire it out to others, then I am lending them my car.


----------



## FlyingFox (24 March 2013)

Looks like they've caved 

http://www.abc.net.au/news/2013-03-24/cyprus-agrees-to-levy-on-large-bank-deposits-official/4590768


----------



## FlyingFox (24 March 2013)

Tyler Durden said:


> Thanks for the link, I must say I disagree with this:
> 
> 
> 
> ...





I see your point. Having said that, aren't all deposits made under the assumption that they are risk free (or relatively risk free) and hence are compensated as such? If deposit holders are to take on some of the risks taken on by bankers shouldn't they be compensated accordingly (e.g deposit rate vs dividend)?


----------



## Boggo (24 March 2013)

Cyprus explained...

You have two cows
You loan the Greeks one of them, and the other is 'protected' by the Russian Mafia.
The EU comes looking for the milk.
In 3 days you try stealing 10% of your neighbour's cows, ask the Greeks where the first cow went, and demand the other cow back from the Mafia.
What's left of you is found decorating the walls of your house by an angry mob of locals who came to burn the place down.
The postman delivers two letters.
One is from the EU, a bill for â‚¬6 bn to your next of kin.
The other is from Ireland, with instructions on how to milk that horse.
The Greeks come to your funeral and eat all the kebabs.


----------



## FlyingFox (24 March 2013)

Boggo said:


> Cyprus explained...
> 
> You have two cows
> You loan the Greeks one of them, and the other is 'protected' by the Russian Mafia.
> ...




Hilarious! Should add that the Greeks milked the cow dry and then proceeded to make kebabs from it.


----------



## prawn_86 (24 March 2013)

FlyingFox said:


> If deposit holders are to take on some of the risks taken on by bankers shouldn't they be compensated accordingly (e.g deposit rate vs dividend)?




They are. The universal risk free rate is considered to be a long dated treasury bond, not an interest bearing bank account (which have higher returns). Of course one could argue there are risks with treasury bonds also.


----------



## FlyingFox (24 March 2013)

prawn_86 said:


> They are. The universal risk free rate is considered to be a long dated treasury bond, not an interest bearing bank account (which have higher returns). Of course one could argue there are risks with treasury bonds also.




I do realise that the long dated treasury bond are the basis of pricing all financial instruments. Won't comment on the their actual riskiness, leave that for another thread.

However deposits are seen as risk free or relatively risk free depending on the state of the bank and credit ratings etc. There is even a government guarantee on them. If that changes, there will be a demand for higher compensation as deposit rates are much closer to treasury bond rates (~ 1% >) than say dividend payouts (~ 3-4 % >). Just personal opinion.

BTW what happens to bank shareholders in Cyprus?


----------



## explod (24 March 2013)

prawn_86 said:


> Of course one could argue there are risks with treasury bonds also.




Particularly when the prime reserve currency (US$) is being printed to buy, 60% currently, of thier bonds issued.


----------



## Smurf1976 (24 March 2013)

If you asked 100 random people on the street what the lowest risk investment is, I'd expect that at least 90% of them would say "put the money in the bank".

Treasury bonds aren't something that your average small investor puts money into. Indeed a lot would have no idea that such things exist in the first place, and even fewer would know how to invest money in that way.

Ordinary non-expert people who deposit cash into banks do so on the assumption that this is the "safest" place to keep their money as well as being a reasonably convenient one.


----------



## Tyler Durden (24 March 2013)

Smurf1976 said:


> If you asked 100 random people on the street what the lowest risk investment is, I'd expect that at least 90% of them would say "put the money in the bank".
> 
> Treasury bonds aren't something that your average small investor puts money into. Indeed a lot would have no idea that such things exist in the first place, and even fewer would know how to invest money in that way.
> 
> Ordinary non-expert people who deposit cash into banks do so on the assumption that this is the "safest" place to keep their money as well as being a reasonably convenient one.




Agree. And I'd even be willing to raise that to 95%.


----------



## Nawill (24 March 2013)

FlyingFox said:


> BTW what happens to bank shareholders in Cyprus?




Yes curious about this as well.  If they are insolvent then presumably the stock is worthless.  The CEO and senior management should be out of work and unemployable in banking etc.  Or is this a too big to fail thing?  The shareholders in a dud business get bailed out by taxpayers again.  Shame I can't get all my equities tax payer underwritten.  I wonder if Nathan Tinkler is too big to fail?

And thanks for the cow analogy.


----------



## ASICK (25 March 2013)

Yipes, 40%! :http://www.news.com.au/breaking-new...ch-bailout-talks/story-e6frfkui-1226605081089

It's good to have friends in high places :
http://www.dailymail.co.uk/news/art...Anastasiades-warned-friends-money-abroad.html


----------



## Aussiejeff (25 March 2013)

ASICK said:


> Yipes, 40%! :http://www.news.com.au/breaking-new...ch-bailout-talks/story-e6frfkui-1226605081089
> 
> It's good to have friends in high places :
> http://www.dailymail.co.uk/news/art...Anastasiades-warned-friends-money-abroad.html




Yep. 

Banksters smile, markets soar, problems fixed.

Yep.


----------



## explod (25 March 2013)

Aussiejeff said:


> Yep.
> 
> Banksters smile, markets soar, problems fixed.
> 
> Yep.




I thought I was well prepared for the approaching armaggeddon but what we are witnessing is *unbelievable.*

And lets see how the markets look in a week or so when it becomes *believable*.


----------



## drsmith (25 March 2013)

I'm trying to work out what this means,



> The Bank of Cyprus, the island's No.1 lender, survives: but it will have to endure a major “haircut” - a forced wipeout of investment value, on all deposits of more than 100,000 euros ($A125,000).




Put simplistically, does a depositor with over 100,000 lose the lot or just that part over 100,000 ?

In relative terms, the latter would make more sense than the former.

http://www.news.com.au/breaking-new...ch-bailout-talks/story-e6frfkui-1226605081089


----------



## explod (25 March 2013)

drsmith said:


> I'm trying to work out what this means,
> 
> 
> 
> ...




The latest interpretation of latest statements is that over $100,000 will lose 40%

But then again the Us$ has gone from $1.30 on the index to .80 in just a few years so if one thinks about it, what is the difference in the long term.  Take it today or dilute it gradually.


----------



## FlyingFox (25 March 2013)

explod said:


> The latest interpretation of latest statements is that over $100,000 will lose 40%
> 
> But then again the Us$ has gone from $1.30 on the index to .80 in just a few years so if one thinks about it, what is the difference in the long term.  Take it today or dilute it gradually.




Can you provide a link for the 40% value?


----------



## cbc1 (25 March 2013)

ere ya go fox,

bout half way down

http://www.bloomberg.com/news/2013-03-25/cyprus-to-chop-banking-system-to-win-aid-avoid-default.html

Don't ask any Russians what 40% of $31 billion in the near future,  they might be a bit sensitive to this.


----------



## CanOz (25 March 2013)

> 16:41 (CY) Chair of Cyprus Finance Committee member Spox: Believes big depositors in Bank of Cyprus to lose 30%; levy to be determined on Tuesday, Mar 26th - Source TradeTheNews.com




Down to 30%?

CanOz


----------



## FlyingFox (25 March 2013)

cbc1 said:


> ere ya go fox,
> 
> bout half way down
> 
> ...








CanOz said:


> Down to 30%?
> 
> CanOz





Thanks. So it's no longer a "haircut". More like getting your legs lobbed off at the knees......


----------



## drsmith (25 March 2013)

explod said:


> The latest interpretation of latest statements is that over $100,000 will lose 40%
> 
> But then again the Us$ has gone from $1.30 on the index to .80 in just a few years so if one thinks about it, what is the difference in the long term.  Take it today or dilute it gradually.



The difference is that they are taking people's savings instead of allowing a floating currency to do it's job. The lesson here is that a single currency is not appropriate for the range of economies in the EU.

That tough still leaves an interesting question.

If the loss is xx% for deposits over $100,000 euro, does a depositor with $100,001 euro end up with $100,001/(1 - xx%), or say $70,000.70 euro for 30% ?


----------



## Knobby22 (25 March 2013)

The bank is broke. They should just wind it up and pay what's left to the depositors. 

Instead they are looking after the small guy which has to be a first in this crisis. It is only occurring because of the power of voting.


----------



## Tyler Durden (25 March 2013)

What will also be interesting is when the banks re-open: will people who are unaffected by the proposed terms leave their money in the bank, or has all trust been eroded and everyone will just withdraw their money?


----------



## YMI (25 March 2013)

drsmith said:


> ...That tough still leaves an interesting question.
> 
> If the loss is xx% for deposits over $100,000 euro, does a depositor with $100,001 euro end up with $100,001/(1 - xx%), or say $70,000.70 euro for 30% ?



I think it’s safe to assume the first. If they say deposits up to 100k are safe then it doesn’t make sense to deduct any amount from that. On the other hand, some of their decisions do actually make no sense to me but perhaps it’s just because I can’t see the bigger picture.


----------



## drsmith (25 March 2013)

YMI said:


> I think it’s safe to assume the first. If they say deposits up to 100k are safe then it doesn’t make sense to deduct any amount from that. On the other hand, some of their decisions do actually make no sense to me but perhaps it’s just because I can’t see the bigger picture.



Putting the right or wrong of this aside for a moment, I would have thought not touching the first $100,000 euro of any deposit and only clipping the portion over $100,000 euro by xx% would be the most logical approach.


----------



## notting (25 March 2013)

drsmith said:


> I would have thought not touching the first $100,000 euro of any deposit and only clipping the portion over $100,000 euro by xx% would be the most logical approach.




Naa first offer was never going to work.
They just did that to get people thinking of the possibilities.
Less votes lost by taking the smaller no of people’s money especially the Richer ones and taking the Russian deposits in probably the most corrupt and Russian capitalized bank.

Now I know why Germany has recalled it's gold from the US.
It's going to melt it down and open up gold ATMs all over the Europe peripheries.


----------



## FlyingFox (25 March 2013)

notting said:


> Now I know why Germany has recalled it's gold from the US.
> It's going to melt it down and open up gold ATMs all over the Europe peripheries.




LOL. Or a gold backed Deutsche Mark if/when the Euro fails.....assuming they didn't get tungsten bars


----------



## ASICK (26 March 2013)

http://www.infowars.com/words-of-warning-get-your-money-out-of-european-banks/

http://www.infowars.com/cyprus-bank...deposits-to-be-looted-from-selected-accounts/

http://www.infowars.com/europe-e100000-savings-now-considered-wealthy/


----------



## skc (26 March 2013)

Latest from Cyprus


----------



## Boggo (26 March 2013)

skc said:


> Latest from Cyprus




Latest from Australia 
http://www.adelaidenow.com.au/news/...e-out-super-raid/story-e6frea7l-1226606148884


----------



## FlyingFox (26 March 2013)

Boggo said:


> Latest from Australia
> http://www.adelaidenow.com.au/news/...e-out-super-raid/story-e6frea7l-1226606148884




All good things must come to an end....


----------



## tech/a (26 March 2013)

FlyingFox said:


> All good things must come to an end....




Yeh
Next election will take care of that!


----------



## FlyingFox (26 March 2013)

tech/a said:


> Yeh
> Next election will take care of that!





unfortunately....until they have to raid super or bank accounts here.....


----------



## tech/a (26 March 2013)

Anarchy is always a good look for Government.

And they wonder why people avoid taxation??


----------



## drsmith (26 March 2013)

They do seem somewhat reluctant to reopen the banks.



skc said:


> Latest from Cyprus
> 
> View attachment 51478


----------



## explod (26 March 2013)

drsmith said:


> They do seem somewhat reluctant to reopen the banks.





Maybe they won't or they cannot.

The Banksters will be holding things back as long as they can so that they can set themselves before the dominoes begin to fall

Some of my circle are questioning why gold is not going up as a result, now that is the laast thing they will allow at this time.  But bust it all will.

We just have to continue to watch this space.

And Governmentalists, tech and a few others above, count for jack sh t in this world we have now.


----------



## Trembling Hand (26 March 2013)

explod said:


> Some of my circle are questioning why gold is not going up as a result, now that is the laast thing they will allow at this time.  But bust it all will.
> 
> We just have to continue to watch this space.
> 
> And Governmentalists, tech and a few others above, count for jack sh t in this world we have now.




Yeah mate its tough being on the wrong side of a trade. Never mind. Sun still shining.


----------



## notting (26 March 2013)

One of the PR difficulties with this saga, is that the Cyprus thing is somewhat unique in that the biggest losers are the Russians. No one can come out and make a big statement about this to quell fears because it would be a diplomatic disaster.
Perhaps they are waiting for people to connect the dots.
There is no way the Europeans would be willing to bail out dirty Russian money.  
Simple.
It's not a precedent as is being speculated in the media!!

Gold may not be going up due to US$ appreciating against EURO.


----------



## explod (26 March 2013)

Trembling Hand said:


> Yeah mate its tough being on the wrong side of a trade. Never mind. Sun still shining.




Trade this market, u know me better than that T/H, just a simple ole sploddy here that is way out of it.

As a matter of fact, the veggies in my new found bush retreat just coming into profit now.  I'll have to set a charting system up.


----------



## brty (26 March 2013)

Don't know if this has been posted, but is interesting...



> No one knows exactly how much money has left Cyprus' banks, or where it has gone. The two banks at the centre of the crisis - Cyprus Popular Bank, also known as Laiki, and Bank of Cyprus - have units in London which remained open throughout the week and placed no limits on withdrawals



.

The source is Reuters, here....

http://www.reuters.com/article/2013/03/25/eurozone-cyprus-muddle-idUSL5N0CG13920130325

This has gone from debacle to farce to ineptitude.

Then again, if you as an individual banker, with a family, had a choice of giving the Russian mafia a hard time, or an out, what would you choose?


----------



## drsmith (26 March 2013)

A question from the first page of this thread,



burglar said:


> Scary! What if this madness catches on?




The idea of it being a one-off seems to be fading,



> (Reuters) - A rescue program agreed for Cyprus will serve as a model for dealing with future euro zone banking crises and other countries will have to restructure their banking sectors, the head of the region's finance ministers said.




http://www.reuters.com/article/2013/03/25/us-eurogroup-cyprus-dijsselbloem-idUSBRE92O10A20130325


----------



## FlyingFox (26 March 2013)

drsmith said:


> The idea of it being a one-off seems to be fading,
> 
> http://www.reuters.com/article/2013/03/25/us-eurogroup-cyprus-dijsselbloem-idUSBRE92O10A20130325




And soon coming to a bank near you.....Ok Ok I am getting a bit carried away but seems looks like the non-printing solution to the GFC induced crisis is to take depositors money.


----------



## Julia (26 March 2013)

FlyingFox said:


> And soon coming to a bank near you.....Ok Ok I am getting a bit carried away but seems looks like the non-printing solution to the GFC induced crisis is to take depositors money.



Maybe not so carried away at all. Despite our well regulated banks here, I'm starting to have some concerns about too much in cash.  Probably quite irrational, but I doubt I'd be the only one.


----------



## Superb Parrot (26 March 2013)

Julia said:


> Maybe not so carried away at all. Despite our well regulated banks here, I'm starting to have some concerns about too much in cash.  Probably quite irrational, but I doubt I'd be the only one.




Not irrational at all, exactly my feelings today.

Classic comment on CNBC today by a Scandinavian commentator, in response to Bernie Low's question, " Should Cyprus leave the Euro zone ?"....answer (paraphrased) " You must remember that the Euro zone is a prison, a prison from which there is no escape"....nearly fell off the chair.


----------



## skc (26 March 2013)

Julia said:


> Maybe not so carried away at all. Despite our well regulated banks here, I'm starting to have some concerns about too much in cash.  Probably quite irrational, but I doubt I'd be the only one.




During the GFC I opened about 7 different online saving accounts and spread my cash between them, until the government guarantee was issued.

Australia is different in the sense that there are no external parties (like the Troika) who can force us to demand depositor's money. Not saying that the Australian banking system won't collapse - but if it does it won't be in the same fashion as Cyprus. May be it'd be more like Iceland - I don't know if the depositors there lost any notional value in their bank account - but the currency was smashed so their PPP was much reduced.


----------



## sinner (26 March 2013)

Martin Wolf from FT


> “Banks are not vaults. They are thinly capitalised asset managers that make a promise– to return depositors’ money on demand and at par– that cannot always be kept without the assistance of a solvent state.”




This is a simple fact that has always been true, and moreso after the end of Glass-Steagall.

This is a stock forum where we always suggest due diligence, but when it comes to our "savings" how many here really exercise it? 

Do you know the tier 1 capital ratio of the banks you loan money to in the form of deposits? CBA, which is rated AAA on local and foreign currency by Fitch, has a 10% Tier 1 capital ratio, i.e. 90c off par.

Do you view cash and bank deposits as the same thing?
http://fofoa.blogspot.com.au/2012/04/peak-exorbitant-privilege.html


> Also, hyperinflation turns physical (as in physical cash) very quickly once it takes hold. So if you're expecting some sort of electronic currency hyperinflation, fuggedaboutit. If you think we're more technologically advanced than bass-ackward Zimbabwe or ancient Weimar, you are not understanding what really happens during currency hyperinflation. It cannot play out electronically all the way to the bitter end because, when prices are rising that fast, physical cash always brings a premium over electronic deposit transfers which require some amount of time (and thereby devaluation) to clear.




Should you even utilise the "medium of exchange"/"unit of account" as a "store of value"?


----------



## tinhat (26 March 2013)

Superb Parrot said:


> Classic comment on CNBC today by a Scandinavian commentator, in response to Bernie Low's question, " Should Cyprus leave the Euro zone ?"....answer (paraphrased) " You must remember that the Euro zone is a prison, a prison from which there is no escape"....nearly fell off the chair.




That truly is classic.


----------



## drsmith (26 March 2013)

Banks in Cyprus to reopen on Thursday, sort of,



tinhat said:


> In a televised address, President Nicos Anastasiades announced that transactions will be limited temporarily as banks reopen – to avoid bank runs.




And some back peddling ??



> In the US, stocks fell when Eurogroup President Jeroen Dijsselbloem said that the Cyprus rescue would act as a model for the eurozone.
> 
> He later clarified that Cyprus was a unique case.




http://www.euronews.com/2013/03/25/bank-re-opening-delayed-in-cyprus/


----------



## FlyingFox (26 March 2013)

Julia said:


> Maybe not so carried away at all. Despite our well regulated banks here, I'm starting to have some concerns about too much in cash.  Probably quite irrational, but I doubt I'd be the only one.




I know what you mean. From your previous comments, I believe your in a similar situation to my parents, I have been trying to get my parents to "diversify" for about a year now. I hope this situation kicks them into gear.



skc said:


> During the GFC I opened about 7 different online saving accounts and spread my cash between them, until the government guarantee was issued.
> 
> Australia is different in the sense that there are no external parties (like the Troika) who can force us to demand depositor's money. Not saying that the Australian banking system won't collapse - but if it does it won't be in the same fashion as Cyprus. May be it'd be more like Iceland - I don't know if the depositors there lost any notional value in their bank account - but the currency was smashed so their PPP was much reduced.




You're probably right. Aussie banks do have exposure to overseas markets through loans and foreign assets and subsidiaries. If they do collapse it will likely be due to :

1) Foreign institutions or investors calling in loans/deposits.
2) Collapse of the housing market.



sinner said:


> Martin Wolf from FT
> 
> 
> This is a simple fact that has always been true, and moreso after the end of Glass-Steagall.
> ...





Great points. Need to read more of fofoa (and buy some bullion too lol). Great stuff. Especially the last point.


----------



## Julia (26 March 2013)

FlyingFox said:


> I know what you mean. From your previous comments, I believe your in a similar situation to my parents, I have been trying to get my parents to "diversify" for about a year now. I hope this situation kicks them into gear.



As it happens, a three year term deposit matured today and will be put into the market, along with another $100K or so that is sitting at call.
The selection of companies, however, is causing me some thought, along with the potential of god knows what globally.


----------



## YMI (27 March 2013)

They are planning police protection for all bank branches in Cyprus tomorrow.   Are they worried


----------



## FlyingFox (27 March 2013)

Julia said:


> As it happens, a three year term deposit matured today and will be put into the market, along with another $100K or so that is sitting at call.
> The selection of companies, however, is causing me some thought, along with the potential of god knows what globally.




Unfortunately I don't think my parents are the equity type. Dad got burnt a little post 9/11 with a small managed fund account he had. Too risk-averse and intent on capital preservation. Runs in the family lol.


----------



## FlyingFox (27 March 2013)

YMI said:


> They are planning police protection for all bank branches in Cyprus tomorrow.   Are they worried




I would be ... there will be a lot of angry people after their money (including the police ).


----------



## Tyler Durden (27 March 2013)

Julia said:


> As it happens, a three year term deposit matured today and will be put into the market, along with another $100K or so that is sitting at call.
> The selection of companies, however, is causing me some thought, along with the potential of god knows what globally.






	

		
			
		

		
	
.


----------



## MrBurns (27 March 2013)

Julia said:


> As it happens, a three year term deposit matured today and will be put into the market, along with another $100K or so that is sitting at call.
> The selection of companies, however, is causing me some thought, along with the potential of god knows what globally.




The only thing I trust at present is Telstra, the market is a gamble no matter what you do, but TLS seems to be protected somehow.


----------



## Buckfont (27 March 2013)

Cyprus may be a long way away, however across the ditch in NZ, similar plans may be afoot. 

http://www.scoop.co.nz/stories/PA13...ing-cyprus-style-solution-for-new-zealand.htm


----------



## MrBurns (27 March 2013)

Buckfont said:


> Cyprus may be a long way away, however across the ditch in NZ, similar plans may be afoot.
> 
> http://www.scoop.co.nz/stories/PA13...ing-cyprus-style-solution-for-new-zealand.htm




This will cause a run if it gets any traction, next thing you know it they'll be closing banks here.


----------



## cbc1 (27 March 2013)

I don't know what they are whinging about......   if you put money in a bank account earning interest then you
are exposed to some sort of risk.


----------



## FlyingFox (27 March 2013)

Buckfont said:


> Cyprus may be a long way away, however across the ditch in NZ, similar plans may be afoot.
> 
> http://www.scoop.co.nz/stories/PA13...ing-cyprus-style-solution-for-new-zealand.htm




Gotta love the Kiwi's. 

Curious, who bails out the insurance companies that are insuring depositors?


----------



## drsmith (27 March 2013)

Julia said:


> As it happens, a three year term deposit matured today and will be put into the market, along with another $100K or so that is sitting at call.
> The selection of companies, however, is causing me some thought, along with the potential of god knows what globally.



If you genuinely fear for bank deposits in Australia, equities is not the place to be. They, along with the $AUD will likely tank before bank deposits are at risk.

The jump-up-and-down-on-the-panic-button option is typically gold.


----------



## drsmith (27 March 2013)

Buckfont said:


> Cyprus may be a long way away, however across the ditch in NZ, similar plans may be afoot.
> 
> http://www.scoop.co.nz/stories/PA13...ing-cyprus-style-solution-for-new-zealand.htm



Greens. 

Typical. :frown:


----------



## FlyingFox (27 March 2013)

drsmith said:


> If you genuinely fear for bank deposits in Australia, equities is not the place to be. They, along with the $AUD will likely tank before bank deposits are at risk.
> 
> The jump-up-and-down-on-the-panic-button option is typically gold.




+ 1


----------



## Julia (27 March 2013)

Buckfont said:


> Cyprus may be a long way away, however across the ditch in NZ, similar plans may be afoot.



Yes, I came across that article a couple of days ago and it no doubt fed the fear.


FlyingFox said:


> Gotta love the Kiwi's.
> 
> Curious, who bails out the insurance companies that are insuring depositors?



Are there actually insurance companies taking on this risk?  My understanding was that the guarantee on bank deposits up to $250K in Australia is offered by the Australian government.
I can't imagine any insurance company being up for it, but perhaps I'm wrong?


----------



## Tyler Durden (27 March 2013)

Well here's a question: let's say you had inside info that in a few months, Australian banks would be 'Cyprus-ed'. Where would you move your cash?


----------



## MrBurns (27 March 2013)

Tyler Durden said:


> Well here's a question: let's say you had inside info that in a few months, Australian banks would be 'Cyprus-ed'. Where would you move your cash?




Aussie bonds ?


----------



## FlyingFox (27 March 2013)

Tyler Durden said:


> Well here's a question: let's say you had inside info that in a few months, Australian banks would be 'Cyprus-ed'. Where would you move your cash?




Because we have a floating currency, the more likely scenario is that the AUD get trashed first (Also if it comes to hair-cutting deposits, it will get trashed again).

In this scenario and only if the rest of the world isn't going to hell in a hand basket then probably a mixture of foreign currency, bullion, blue chip foreign equities and possibly local property (maybe some bargains around?). 

Alas if everything is going downhill then bullion looks like the only option ?? Plus maybe local property.


----------



## ASICK (28 March 2013)

*A Downer in Cyprus*

http://www.cyprus-mail.com/taxonomy/term/19798/all


----------



## brty (28 March 2013)

Just read the following capital controls that are coming into place for the opening of banks in Cyprus..

http://www.cyprus-mail.com/capital-...e-opening-banks-text-decree-included/20130328



> Finance Minister Michalis Sarris last night signed into law a temporary decree capping cash withdrawals per person per bank per day at â‚¬300, effectively banning cheques and controlling cash outflows from the country, allowing only â‚¬1,000 per person per journey abroad.




Didn't notice anything about controlling the movement of PMs, therefore it might be a busy time for gold and silver merchants when the locals and russians can get their E300/day. I would expect the number of Russian tourists to increase very quickly.

As an interesting side note, I was at a bank in a country town here in Australia this morning, there were lines at the ATMs and inside going out the door, more than anything usual. Even my wife stated that it would be prudent to reduce bank holdings, not something she would usually be interested in. I am not suggesting a run on banks here, just that it seems that confidence in security of bank deposits has been delt a critical blow.


----------



## againsthegrain (28 March 2013)

and so the bitcoins continue to go up


----------



## sinner (28 March 2013)

againsthegrain said:


> and so the bitcoins continue to go up




lol bitcoins, what a "market", you can clear max 100BTC a day through Mt Gox, less through other exchanges. There is about...700USD of depth on either side in the BTCUSD futs on ictbit.se and about 7000USD depth on MtGox. 

What good is the "going up" if cashing out a tiny position involves moving the market several price levels?


----------



## skc (28 March 2013)

The search for the next Cyprus is on the way...

http://www.guardian.co.uk/business/2013/mar/25/cyprus-banks-malta-luxembourg


The bank of Cyprus has branches in Australia from memory... actually just found out that it was acquired by Bank of Bendigo a couple of years ago. Thank goodness.


----------



## notting (28 March 2013)

skc said:


> The bank of Cyprus has branches in Australia from memory... actually just found out that it was acquired by Bank of Bendigo a couple of years ago. Thank goodness.




I remember walking past a branch and doing a double take.
"What the hell is that doing here?
Who would point any money with them.
Nuts!" I thought.
But there it was.  Serving the Greek comunity perhaps?


----------



## againsthegrain (28 March 2013)

sinner said:


> lol bitcoins, what a "market", you can clear max 100BTC a day through Mt Gox, less through other exchanges. There is about...700USD of depth on either side in the BTCUSD futs on ictbit.se and about 7000USD depth on MtGox.
> 
> What good is the "going up" if cashing out a tiny position involves moving the market several price levels?




But it does involve not being at risk of having your funds stolen by a govt, not paying tax and remaining anonymous


----------



## drsmith (28 March 2013)

brty said:


> As an interesting side note, I was at a bank in a country town here in Australia this morning, there were lines at the ATMs and inside going out the door, more than anything usual. Even my wife stated that it would be prudent to reduce bank holdings, not something she would usually be interested in. I am not suggesting a run on banks here, just that it seems that confidence in security of bank deposits has been delt a critical blow.



Petrol price hike day of the week ?

Thursday before Easter ?

I dare not question a lady's fears though.


----------



## sinner (28 March 2013)

againsthegrain said:


> But it does involve not being at risk of having your funds stolen by a govt, not paying tax and remaining anonymous




except that your "funds" once they're in bitcoin form, are only even remotely useful if you can convert them back into taxable, stealable, not-anonymous, good old fashioned fiat currency. This liquidity of the bitcoin market also puts a very very definite limit on how much you could "save" in bitcoins, if you wanted to. It's not much. If your net worth is even half of the Aus average it's pretty useless. 

This will hold true until you can pay for food, water, clothing, shelter, energy, taxes, education, entertainment, drugs and sex in bitcoins. Not going to happen.

Imagine putting all your wealth in bitcoins and then needing to pay for something unexpected in the middle of a banking crisis where banks and ATMs are closed. Please explain how you expect to convert your digital currency into physical currency.

I would also point out that bitcoin is only as anonymous as your wallet identity. If I can tie your identity to a particular bitcoin wallet then I can track all transactions as a matter of the inherent bitcoin design. In that sense, cash is significantly more anonymous than bitcoins.


----------



## howmanyru (28 March 2013)

So, what stands out here to me is that wealth is only an illusion - it can be taken away from you at any moment. They let us play with the illusion, until they don't. It makes you wonder if you really own anything, when they can take it from you at will. Even gold is no use, they can destroy its value just as easy as paper money. It's a game, and you need to know the rules, but they hold all the cards.


----------



## sinner (28 March 2013)

howmanyru said:


> So, what stands out here to me is that wealth is only an illusion - it can be taken away from you at any moment. They let us play with the illusion, until they don't. It makes you wonder if you really own anything, when they can take it from you at will. Even gold is no use, they can destroy its value just as easy as paper money. It's a game, and you need to know the rules, but they hold all the cards.




Well you can't take it with you when you die but aside from that I disagree and fail to see how gold is anything but unencumbered physical wealth.


----------



## againsthegrain (28 March 2013)

sinner said:


> except that your "funds" once they're in bitcoin form, are only even remotely useful if you can convert them back into taxable, stealable, not-anonymous, good old fashioned fiat currency. This liquidity of the bitcoin market also puts a very very definite limit on how much you could "save" in bitcoins, if you wanted to. It's not much. If your net worth is even half of the Aus average it's pretty useless.
> 
> This will hold true until you can pay for food, water, clothing, shelter, energy, taxes, education, entertainment, drugs and sex in bitcoins. Not going to happen.
> 
> ...




You could say the same about shares gold silver and I dare say property to a certain degree except you can live in it or have others squat

Anyway I was simply stating since this started bitcoins have been gaining momentum, is it the Russians? I don't know. Never said there is big money to be made trading  but the currency has been pushed up quiet heavily with some days having up to 70k btc USD per day
t


----------



## chops_a_must (28 March 2013)

sinner said:


> This will hold true until you can pay for food, water, clothing, shelter, energy, taxes, education, entertainment, drugs and sex in bitcoins. Not going to happen.




You can pay for sex with these I think.

I believe you go to a "two bit *****".


----------



## ASICK (28 March 2013)

http://dollarvigilante.com/blog/201...n-atm-is-announced-first-location-cyprus.html

one of the comments says that the photo is from Thailand - yes, it is !  but I guess it's about the story, not the pic.


----------



## againsthegrain (28 March 2013)

chops_a_must said:


> You can pay for sex with these I think.
> 
> I believe you go to a "two bit *****".





Lol sorry for going off the topic but u can definately  pay for drugs and other grey items in case you have not heard of the silk road marketplace


----------



## FlyingFox (28 March 2013)

againsthegrain said:


> You could say the same about shares gold silver and I dare say property to a certain degree except you can live in it or have others squat




Property perhaps, shares less so but you can easily liquidate almost any amount of bullion that the average person would have.

We were out checking out prices the weekend before last and went into this bullion dealers shop. He was busy so we came back. The person prior had just bought 50k worth of gold with cash. The dealer was saying that he himself buys up to that much in a single transaction normally and more on special request etc.

Considering there at least 5-10 such dealers in Melbourne that I know of, I would say bullion is a lot more liquid than bit coin.


----------



## Tyler Durden (29 March 2013)

> ''Very bad, very, very bad,'' says 65-year-old John Demetriou, rubbing tears from his lined face with thick fingers. ''I lost all my money.''
> 
> John now lives in the picturesque fishing village of Liopetri on Cyprus' south coast. But for 35 years he lived at Bondi Junction and worked days, nights and weekends in Sydney markets selling jewellery and imitation jewellery.
> 
> He had left Cyprus in the early 1970s at the height of its war with Turkey, taking his wife and young children to safety in Australia. He built a life from nothing and, gradually, a substantial nest egg. He retired to Cyprus in 2007 with about $1 million, his life savings.




http://www.smh.com.au/national/i-we...-man-i-woke-up-a-poor-man-20130328-2gxab.html


----------



## MrBurns (29 March 2013)

Tyler Durden said:


> http://www.smh.com.au/national/i-we...-man-i-woke-up-a-poor-man-20130328-2gxab.html




Legal theft, disgusting
How the banks creditors can take other people's money is quite disturbing
Is that the way it works ? Would the same apply here ?
I'm a little nervous now...


----------



## MrBurns (29 March 2013)

Money in the bank doesn't belong to the bank ? or does it


----------



## FlyingFox (29 March 2013)

MrBurns said:


> I'm a little nervous now...




And this is not going to help you sleep any better.

http://www.counterpunch.org/2013/03/28/the-confiscation-scheme-planned-for-us-and-uk-depositors/

with the link to the white paper http://www.fdic.gov/about/srac/2012/gsifi.pdf



> An efficient path for returning the sound operations of the G-SIFI to the private sector would be provided by exchanging or converting a sufficient amount of the unsecured debt from the original creditors of the failed company [meaning the depositors] into equity [or stock]. In the U.S., the new equity would become capital in one or more newly formed operating entities. In the U.K., the same approach could be used, or the equity could be used to recapitalize the failing financial company itself””thus, the highest layer of surviving bailed-in creditors would become the owners of the resolved firm. In either country, the new equity holders would take on the corresponding risk of being shareholders in a financial institution.






> > In the US, depositors have actually been put in a worse position than Cyprus deposit-holders, at least if they are at the big banks that play in the derivatives casino. The regulators have turned a blind eye as banks use their depositaries to fund derivatives exposures. And as bad as that is, the depositors, unlike their Cypriot confreres, aren’t even senior creditors. Remember Lehman? When the investment bank failed, unsecured creditors (and remember, depositors are unsecured creditors) got eight cents on the dollar. One big reason was that derivatives counterparties require collateral for any exposures, meaning they are secured creditors. The 2005 bankruptcy reforms made derivatives counterparties senior to unsecured lenders.
> 
> 
> 
> ...


----------



## McLovin (29 March 2013)

That FDIC paper is not referring to depositors as unsecured creditors. If fact the paper is at pains to say that by protecting depositors the bank is less likely to be a victim of bank runs.




> Similarly, because the group remains solvent, retail or corporate depositors should not have an incentive to “run” from the firm under resolution insofar as their banking arrangements, transacted at the operating company level, remain unaffected. In order to achieve this, the authorities recognize the need for effective communication to depositors, making it clear that their deposits will be protected.




What a surprise that some two bit news organisation purporting to tell the facts, adds its own editorial in parethesis that is completely wrong.

So much for "investigative journalism". More like reactionary hyperbole.


----------



## FlyingFox (29 March 2013)

McLovin said:


> That FDIC paper is not referring to depositors as unsecured creditors. If fact the paper is at pains to say that by protecting depositors the bank is less likely to be a victim of bank runs.




Are depositors not unsecured creditors under most current banking rules ?


----------



## McLovin (29 March 2013)

FlyingFox said:


> Are depositors not unsecured creditors under most current banking rules ?




No. A deposit holder is secured by a floating charge over most/all the assets of a bank.


----------



## FlyingFox (30 March 2013)

McLovin said:


> No. A deposit holder is secured by a floating charge over most/all the assets of a bank.




Thanks for the clarification.


----------



## ASICK (30 March 2013)

McLovin said:


> No. A deposit holder is secured by a floating charge over most/all the assets of a bank.




I would have thought, that in the wind up of a bank, deposit holders would stand behind bank creditors and divvy up the proceeds after creditors  have been paid out.

Do you have a link that discloses exactly where deposit holders stand in relation to security?


----------



## McLovin (30 March 2013)

ASICK said:


> I would have thought, that in the wind up of a bank, deposit holders would stand behind bank creditors and divvy up the proceeds after creditors  have been paid out.
> 
> Do you have a link that discloses exactly where deposit holders stand in relation to security?






> Failure resolution
> A final layer of safety in the Australian financial system is
> the various protections offered when an institution fails.
> 
> ...




http://www.apra.gov.au/AboutAPRA/Publications/Documents/APRA_FS1_122011_v1.pdf

If you have a look at an Australian bank balance sheet, they have a lot of fat on them that I wouldn't be worried about it.


----------



## ASICK (30 March 2013)

http://www.infowars.com/so-whats-it-like-to-have-a-business-in-cyprus-right-now-2/


----------



## ASICK (30 March 2013)

McLovin said:


> http://www.apra.gov.au/AboutAPRA/Publications/Documents/APRA_FS1_122011_v1.pdf
> 
> If you have a look at an Australian bank balance sheet, they have a lot of fat on them that I wouldn't be worried about it.




Thanks.


----------



## ASICK (30 March 2013)

http://www.infowars.com/cyprus-styl...d-in-the-new-2013-canadian-government-budget/


----------



## ASICK (30 March 2013)

http://republicbroadcasting.org/index.php?cmd=news.article&articleID=5029


----------



## Tyler Durden (30 March 2013)

> As Cyprus cautiously cracked open the doors of its crisis-ridden banks on Thursday, pig farmer Stelios Sofroniou fumed at being able to withdraw only â‚¬300 ($369). That would buy just 1 tonne of feed, not the 30 tonnes he needed for his 15,000 pigs.
> 
> ...
> 
> ...




http://www.smh.com.au/business/worl...cash-limit-hurts-business-20130329-2gyqh.html


----------



## drsmith (30 March 2013)

The pigs at the top of the EU I suspect understand the laws of nature.


----------



## ASICK (31 March 2013)

http://www.infowars.com/the-cyprus-deal-and-the-unraveling-of-fractional-reserve-banking/

http://www.reuters.com/article/2013/03/29/us-cyprus-parliament-idUSBRE92G03I20130329

http://www.infowars.com/this-is-wha...life-savings-confiscated-by-the-global-elite/


----------



## ASICK (31 March 2013)

http://www.news.com.au/business/bre...ace-daily-review/story-e6frfkur-1226609323665


----------



## prawn_86 (31 March 2013)

ASICK,

Rather than just flooding the threads with links you might generate more discussion if you let us know hwat each article is about, why/how it is different to the rest of the articles, or your opinions on it

Thanks


----------



## Julia (31 March 2013)

prawn_86 said:


> ASICK,
> 
> Rather than just flooding the threads with links you might generate more discussion if you let us know hwat each article is about, why/how it is different to the rest of the articles, or your opinions on it
> 
> Thanks



+1.  Just putting up a link with no explanation is pretty irritating.


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## ASICK (31 March 2013)

prawn_86 said:


> ASICK,
> 
> Rather than just flooding the threads with links you might generate more discussion if you let us know hwat each article is about, why/how it is different to the rest of the articles, or your opinions on it
> 
> Thanks






Julia said:


> +1.  Just putting up a link with no explanation is pretty irritating.




I thought the articles were self-explanatory and informative - there was simply nothing I could add, but I'm pleased to desist if you guys aren't interested in great information.


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## Garpal Gumnut (31 March 2013)

The debacle in Cyprus was inevitable.

I have no sympathy for anyone involved in the losses.

The Cypriot bankers, and the Cypriots themselves must have known. It is a small place.

The majority of money propping up Cyprus in the last three years has been from Russian Mafia, people who trade arms, buy and sell slaves, and money launder.

70% is too little to lose for those bastards. 

From the Independent UK.

http://www.independent.co.uk/news/world/europe/moscows-mafia-finds-an-island-in-the-sun-cyprus-is-awash-with-dubious-dollars-from-russia-robert-fisk-reports-from-limassol-on-the-visitors-with-private-jets-bulging-suitcases-and-a-reluctance-to-answer-questions-1381056.html



> HUNDREDS of Russians have deposited millions of dollars in cash in the Mediterranean island of Cyprus in what local bankers suspect has been a giant scheme to launder the profits of covert Middle East arms sales and the proceeds of Moscow's mafia.
> Foreign and local banking officials have told the Independent that over the past two years Russians have arrived at their offices in Limassol and Nicosia with suitcases containing up to dollars 15m ( pounds 10m) in one-hundred-dollar bills, opened accounts and then transferred funds to Switzerland, Germany and Britain.
> 
> Although the Cyprus Central Bank insists that strict financial controls by the Greek Cypriot administration prevent any 'bad' money coming into the island, local bankers say that Russians have deposited millions - sometimes carrying the money to the banks in taxis direct from Larnaca airport - with only nominal inquiries from banks about the sources of the money. 'Let's speak frankly,' one Cypriot banker said in Nicosia. 'Russia is bankrupt and can't generate this kind of cash. All money that's coming from Moscow is illegal because of Russia's exchange-control regulations. But we're talking of millions and that can only come from illegal arms sales, most probably to Iran and Iraq.'




gg


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## Vixs (31 March 2013)

ASICK said:


> I thought the articles were self-explanatory and informative - there was simply nothing I could add, but I'm pleased to desist if you guys aren't interested in great information.




Don't mind the feedback ASICK, if people don't want to have to click to find out what a link is about they can just not click it.

Link description would be preferable but it's hardly the end of the world.


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## Tyler Durden (31 March 2013)

ASICK said:


> I thought the articles were self-explanatory and informative - there was simply nothing I could add, but I'm pleased to desist if you guys aren't interested in great information.




Hey mate, I enjoy your links, but perhaps you could quote an extract to give us a taste of it?

However if you don't wish to do that, I hope you keep contributing


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## Garpal Gumnut (1 April 2013)

ASICK said:


> I thought the articles were self-explanatory and informative - there was simply nothing I could add, but I'm pleased to desist if you guys aren't interested in great information.






Vixs said:


> Don't mind the feedback ASICK, if people don't want to have to click to find out what a link is about they can just not click it.
> 
> Link description would be preferable but it's hardly the end of the world.






Tyler Durden said:


> Hey mate, I enjoy your links, but perhaps you could quote an extract to give us a taste of it?
> 
> However if you don't wish to do that, I hope you keep contributing




Any ole monkey can post links.

This is not twitter.

Read my post above and comment.

This is not a finishing school for the belief challenged nor a club to encourage the muppets of this world.

I hope y'all keep on contributing...Jayzoo !!

gg


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## FlyingFox (1 April 2013)

Garpal Gumnut said:


> The debacle in Cyprus was inevitable.
> 
> I have no sympathy for anyone involved in the losses.
> 
> ...




While I generally agree with your sentiments....not all involved were from the Russian Mafia or Oligarchy. Like the retiree from Oz who was interviewed, many will have the rest of their lives substantially altered due to this. Having said that Caveat Emptor. 

Also at the rate the banker are going, they might soon be doing more damage than the warlords and arms dealers :


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## Garpal Gumnut (1 April 2013)

FlyingFox said:


> While I generally agree with your sentiments....not all involved were from the Russian Mafia or Oligarchy. Like the retiree from Oz who was interviewed, many will have the rest of their lives substantially altered due to this. Having said that Caveat Emptor.
> 
> Also at the rate the banker are going, they might soon be doing more damage than the warlords and arms dealers :




Thanks FlyingFox, a return to debate after some sad posts.

Unfortunately for our Australian-Cypriot, he is the exception that proves the rule.

All Cypriots knew of the dodgy money coming in to that country, from the baggage handlers unloading cases full of cash, to the taxi drivers driving the Russians to the banks, to the prostitutes servicing them, the villa owners selling or renting and the shops and cafes selling their wares and feeding them.

If you sup with the devil you get indigestion.

Cyprus deserves a very large haircut.

And the EU will be better for it, and so will the Global Financial System

gg


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## qldfrog (1 April 2013)

The EU sabotaged itself by its decision of not following its own rule about the 100k garantee first (the reversal is too late, the damage is done) and it might even take years to unfold but it is the beginning of the end for european finance in my opinion

But one point is  quite forgotten in this story.
No one can blame the situation in chyprus on siesta mentality, no tax, people  indulging in a RE boom and dust cycle or anything like that, this is not Greece.
The state is so small that the actual economy of the island is peanuts.
So why have they reached that state?
Just because most of their banks financial instruments were linked (culture/language,physical proximity) to greek finance.
They are collateral damages of the "haircut" decisions made a few months ago on greek debts and bonds and *even billions of clean or unclean russian money was not able to save them* and THAT is the real worry..
They are "fall of the domino number TWO"
So the real question is: what about the other banks in europe? or elsewhere?
How much do they have in greek, spanish, italian bonds or financial tools?
Assets which are worthless but where everyone turns a blind eye.
I do believe it is not anymore a question of "when ths s..hit the fan", I believe we are in already and in a big way.
my usual gloomy view
I do not knowingly own any money in Chyprus..but probably do anyway......
Enjoy Easter monday


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## YMI (1 April 2013)

qldfrog said:


> ... Enjoy Easter monday



You too, Happy Easter 

In my view, both Cyprus’ and Greece’s economy are peanuts in the EU. From the beginning I couldn’t understand why they didn’t decide a clean solution, either give Greece the money they needed or kick them out. Instead, they delayed the solution for years, attracted the attention of the whole world on a small problem and by that spread a lot of uncertainty if or how long the unified currency can survive. Ridiculous in my opinion, Greece is just not big enough to cause a collapse of the EU.

What worries me more is that by igniting the global uncertainty, they have probably worsened the situation in Italy and Spain. And I don’t think the IMF is big enough to bail out Italy when they default. In other words; more uncertainty. And the ever changing news about the so called haircut in Cyprus don’t make it any better, first it was 10% on any amounts/deposits over 100k, then 40% and the latest I heard was up to 60% for customers of the biggest bank and 100% at the second biggest bank.


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## CanOz (1 April 2013)

qldfrog said:


> The EU sabotaged itself by its decision of not following its own rule about the 100k garantee first (the reversal is too late, the damage is done) and it might even take years to unfold but it is the beginning of the end for european finance in my opinion
> 
> But one point is  quite forgotten in this story.
> No one can blame the situation in chyprus on siesta mentality, no tax, people  indulging in a RE boom and dust cycle or anything like that, this is not Greece.
> ...




Good points and agree that we have not seen the end of this yet. The EU is simply hopeless in dealing with these situations. Politically theyre obviously divided. 

It will take decades to unwin ethics mess and there will be periods where all the news appears to be good, that's just the way the media paints the pictures. Dont be fooled folks, nothing has changed. The EU still has massive debts to pay off all while trying to maintain austerity. They're in a recession that could become worse. They are a drag on global GDP, if it wasn't for the US the world would be in a net recession still.

More shorting opportunities ahead.

CanOz


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## Tyler Durden (1 April 2013)

YMI said:


> And the ever changing news about the so called haircut in Cyprus don’t make it any better, first it was 10% on any amounts/deposits over 100k, then 40% and the latest I heard was up to 60% for customers of the biggest bank and 100% at the second biggest bank.




Now this seems to be the latest:



> Under conditions expected to be announced on Saturday, depositors in Bank of Cyprus will get shares in the bank worth 37.5 percent of their deposits over 100,000 euros, the source told Reuters, while the rest of their deposits may never be paid back.




http://www.reuters.com/article/2013/03/29/us-cyprus-parliament-idUSBRE92G03I20130329

Also, seems like the wave has reached Italy:



> Customers' deposits at Italian bank Monte dei Paschi fell by "a few billion euros" after a scandal erupted in February over loss-making derivatives trades at the lender, the bank said in a document posted on its web site on Saturday.




http://www.reuters.com/article/2013/03/30/us-monte-dei-paschi-deposits-idUSBRE92T08520130330


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## FlyingFox (1 April 2013)

Garpal Gumnut said:


> All Cypriots knew of the dodgy money coming in to that country, from the baggage handlers unloading cases full of cash, to the taxi drivers driving the Russians to the banks, to the prostitutes servicing them, the villa owners selling or renting and the shops and cafes selling their wares and feeding them.
> 
> If you sup with the devil you get indigestion.
> Cyprus deserves a very large haircut.
> ...




Fair point. But the only reason they are getting haircut is that the banks invested the money into Greek bonds as per qldfrogs comment later.  This seems to be lost. 

Agree with you last point. 



qldfrog said:


> The EU sabotaged itself by its decision of not following its own rule about the 100k garantee first (the reversal is too late, the damage is done) and it might even take years to unfold but it is the beginning of the end for european finance in my opinion




More than europe probably.



qldfrog said:


> But one point is  quite forgotten in this story.
> No one can blame the situation in chyprus on siesta mentality, no tax, people  indulging in a RE boom and dust cycle or anything like that, this is not Greece.
> The state is so small that the actual economy of the island is peanuts.
> So why have they reached that state?
> ...




Agree. This seems to be a lost point. 




qldfrog said:


> They are "fall of the domino number TWO"
> So the real question is: what about the other banks in europe? or elsewhere?
> How much do they have in greek, spanish, italian bonds or financial tools?
> Assets which are worthless but where everyone turns a blind eye.
> ...




Probably a fair amount. The real question is since the GFC have they actually looked at the instruments and traced back to see where/what they are tied to? Or are they still buying the AAA rating by the rating agencies and big inv banks? 



YMI said:


> You too, Happy Easter
> 
> In my view, both Cyprus’ and Greece’s economy are peanuts in the EU. From the beginning I couldn’t understand why they didn’t decide a clean solution, either give Greece the money they needed or kick them out. Instead, they delayed the solution for years, attracted the attention of the whole world on a small problem and by that spread a lot of uncertainty if or how long the unified currency can survive. Ridiculous in my opinion, Greece is just not big enough to cause a collapse of the EU.
> 
> What worries me more is that by igniting the global uncertainty, they have probably worsened the situation in Italy and Spain. And I don’t think the IMF is big enough to bail out Italy when they default. In other words; more uncertainty. And the ever changing news about the so called haircut in Cyprus don’t make it any better, first it was 10% on any amounts/deposits over 100k, then 40% and the latest I heard was up to 60% for customers of the biggest bank and 100% at the second biggest bank.




Partly political. Merkel can't be seen bankrolling the lazy Greeks, Italians etc. Partly there is no easy solution out of this and they have been trying to think of one. Even if Greece, Italy and Spain are kicked out of the EU, any collapse in their government and financial systems will hurt everyone around. And like you said they are too big to bail out. Also the kicker I believe is that they also can't print themselves out (rather get more debt) because their taxpayer base is very quickly eroding. 

The cyprus haircut may just be the template of things to come elsewhere.


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## DB008 (2 April 2013)

*They took millions from Cyprus to escape the "haircut"*


http://translate.google.com/translate?sl=el&tl=en&js=n&prev=_t&hl=el&ie=UTF-8&eotf=1&u=http%3A%2F%2Fwww.protothema.gr%2Fpolitics%2Farticle%2F%3Faid%3D267996&act=url



> Four pages with the names of some 132 companies and individuals who withdrew the bulk of their deposits in euros, dollars and rubles kept in local banks reveals protothema.gr.
> 
> Transfers of money totaling causes vertigo made within 15 days, namely the period from 1st until March 15, 2013. On Friday, March 15 at the Eurogroup meeting which decided formally levy, as has been called the "haircut", on deposits of companies and individuals in all banks in Cyprus. These 132 companies and individuals seem to have "inside" information about impending single taxation of deposits in Cypriot banks so it proved as the elements contained in lists, in most cases, they withdrew all their deposits in Euro, dollars and rubles, which moved to other banks outside Cyprus, which apparently considered a "safe harbor."
> 
> ...


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## lusk (2 April 2013)

Tyler Durden said:


> Now this seems to be the latest:
> 
> 
> 
> ...




If anyone has their money in that Italian bank with a share price that has gone from 5 Euro to 0.18 Euro they deserve to loose it.


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## Tyler Durden (7 April 2013)

skc said:


> The way I see it is that the situation sounds bad initially but ultimately it is the same as other forms of tax increase, austerity or even inflation. The consequence is that the private citizens' purchasing power is reduced.
> 
> The Australian government had a one-time QLD flood levy in 2011. I paid my share but I was not offered any choice or consulted in the process. The economic impact to me would be the same had they simply take the same amount from my bank account. But they called it a tax/levy and took it out of people's pay instead. The situation and cause are slightly different, but the economic consequences are similar. Yet somehow a flood levy doesn't sound nearly as dramatic as a disposit levy.






skc said:


> Government has the power to take money from the public... either through taxes, reduced welfare, deliberate inflation or "direct debit" of bank accounts. The economic consequence is the same, and each of these methods will hurt some subset of the public.
> 
> Cast aside the notion that savers are for some reason more sacred than tax payers or welfare recipients, and ignore the quantum of the two levies (as they are trying to address problems of different magnitude) you will find there are more similarities than differences. They are both one-off levies, they are both imposed on the public (a different subset of the public), and they are both done as extraordinary measures to address issues elsewhere in the system.




Whilst it's true that the government has the power to take money from us (or do anything, really), what makes this Cyprus situation so hard to swallow is it's a retrospective tax. I think people are accustomed to 'future' taxes, at least people have the opportunity to prepare/plan for it. But to retrospectively take your money away is very much akin to stealing.


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## sptrawler (7 April 2013)

Tyler Durden said:


> Whilst it's true that the government has the power to take money from us (or do anything, really), what makes this Cyprus situation so hard to swallow is it's a retrospective tax. I think people are accustomed to 'future' taxes, at least people have the opportunity to prepare/plan for it. But to retrospectively take your money away is very much akin to stealing.





Well the heading could be 'shock in Australia as savers face bailout levy', apparently no one sees the conection.lol

Reading your post, what is the difference, when people were forced to accept super payments in leiu of pay rises. Now the rules change annualy.


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## McLovin (7 April 2013)

Tyler Durden said:


> Whilst it's true that the government has the power to take money from us (or do anything, really), what makes this Cyprus situation so hard to swallow is it's a retrospective tax. I think people are accustomed to 'future' taxes, at least people have the opportunity to prepare/plan for it. But to retrospectively take your money away is very much akin to stealing.




So a company is insolvent, the government guarantees that savers with EUR100k or less will be reimbursed first. That leaves everyone else as creditors of a failed company. As it is they are able to keep 40% of their money by being bailed out with public funds. 

How exactly is this a tax, retrospective or other? I imagine without government intervention they would have faired much more poorly.


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## sptrawler (7 April 2013)

McLovin said:


> So a company is insolvent, the government guarantees that savers with EUR100k or less will be reimbursed first. That leaves everyone else as creditors of a failed company. As it is they are able to keep 40% of their money by being bailed out with public funds.
> 
> How exactly is this a tax, retrospective or other? I imagine without government intervention they would have faired much more poorly.




The Government is also responsible for implementing capital adequacy requirements(in Aus, not sure about Cyprus) and ensuring these are met.
Therefore a degree of resonsibility falls at the feet of the Government, to ensure the banks are being diligent in their operation and to check the assetts supporting that capital adequacy ratio.


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## McLovin (7 April 2013)

sptrawler said:


> The Government is also responsible for implementing capital adequacy requirements(in Aus, not sure about Cyprus) and ensuring these are met.
> Therefore a degree of resonsibility falls at the feet of the Government, to ensure the banks are being diligent in their operation and to check the assetts supporting that capital adequacy ratio.




Sure, but the government is responsible for setting lots of regulations in lots of industries, that doesn't automatically make them responsible for the investment decisions that result from those regulations. Cypriot banks are private enterprises that ultimately decide where to invest their money as should be the case in a mixed-market economy. That they chose to put it into Greek bonds is not the fault of the Cypriot government. 

In any event, the haircut is not a tax.


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## Macquack (7 April 2013)

McLovin said:


> In any event, the haircut is not a tax.




I agree it is not a tax, it is just pure theft.


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## Tyler Durden (7 April 2013)

I use the word 'tax' loosely - whenever the government takes money away from you, they disguise it by calling it a tax.


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## sptrawler (7 April 2013)

McLovin said:


> Sure, but the government is responsible for setting lots of regulations in lots of industries, that doesn't automatically make them responsible for the investment decisions that result from those regulations.




Well in Australia, where the government basically forces you to have your wage paid directly into a bank account, there is a certain amount of responsibility and accountability attached.

If not I'll have my pay in cash, thanks very much.


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## McLovin (7 April 2013)

Macquack said:


> I agree it is not a tax, it is just pure theft.




So what would they have gotten if the government hadn't bailed them out? That's why the tax argument is so ridiculous, it assumes that the bank was solvent and functioning and the government raided bank accounts to shore up its own finances. Which couldn't be further from the truth. It was a liquidation of an insolvent bank. I honestly don't know why this is so hard to understand.



			
				Tyler Durden said:
			
		

> I use the word 'tax' loosely - whenever the government takes money away from you, they disguise it by calling it a tax.




So they should have just not got involved and left the savers to sort it out themselves? Fine by me. At least it would stop the whinging about "taxes". 




			
				sptrawler said:
			
		

> Well in Australia, where the government basically forces you to have your wage paid directly into a bank account, there is a certain amount of responsibility and accountability attached.




How do they do that?


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## sptrawler (7 April 2013)

Well I've only worked for large companies, but there was never an option to take your pay as cash.

I assumed it was legislated that wages had to be deposited into a bank, it would make sense for the tax department. I will stand corrected, as I said it was an assumption.


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## McLovin (7 April 2013)

sptrawler said:


> Well I've only worked for large companies, but there was never an option to take your pay as cash.
> 
> I assumed it was legislated that wages had to be deposited into a bank, it would make sense for the tax department. I will stand corrected, as I said it was an assumption.




I don't know of any legislation, my understanding is that for large companies it's far easier to do bulk EFT than cut people cheques or head down to the local branch and get cash out.

I ran a business a couple of years ago and paid some of the staff cash (with tax deducted of course) because that's what they preferred.


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## tinhat (7 April 2013)

sptrawler said:


> Well I've only worked for large companies, but there was never an option to take your pay as cash.
> 
> I assumed it was legislated that wages had to be deposited into a bank, it would make sense for the tax department. I will stand corrected, as I said it was an assumption.




Those were the good old days. When I started working everyone got their wages in cash. The cashier would come around with your pay envelope and inside would be your money (notes and coins) and a pay slip. Then it was down to the pub!


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## sptrawler (7 April 2013)

tinhat said:


> Those were the good old days. When I started working everyone got their wages in cash. The cashier would come around with your pay envelope and inside would be your money (notes and coins) and a pay slip. Then it was down to the pub!




Oh, to be able to go back to that, no plastic just folding stuff in your back pocket.


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## sptrawler (7 April 2013)

McLovin said:


> I don't know of any legislation, my understanding is that for large companies it's far easier to do bulk EFT than cut people cheques or head down to the local branch and get cash out.
> 
> I ran a business a couple of years ago and paid some of the staff cash (with tax deducted of course) because that's what they preferred.




My mistake, when or if I ever go back to work I'll ask for cash. Also hopefully I could opt for money rather than super.
Ah, the perfect world.

Gosh isn't life so much easier when Labor are in office looking after the worker.
You don't have a worry in the world, you know you are in safe hands, thanks Wayne.


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## Tyler Durden (14 April 2013)

Cyprus ain't over.



> After a chaotic month in which Cyprus was pushed to the brink of default and a possible exit from the eurozone, Cypriots knew things would get bad. But not this bad.
> 
> A bleak assessment released on Thursday by its European partners, says the Cypriot economy will spiral downwards for at least the next two years, contracting by up to 12.5 per cent as the country cuts a banking sector that had ballooned to more than five times its gross domestic product.
> 
> And because the economy will do worse than expected, Cyprus must soon raise â‚¬13 billion - nearly twice the amount the government thought it would have to come up with just a month ago - in order to keep its debt and deficit from spinning out of control and to maintain a â‚¬10 billion ($12.4 billion) international bailout secured last month by the newly elected president, Nicos Anastasiades.




More at http://www.smh.com.au/business/cyprus-slips-a-little-closer-to-oblivion-20130412-2hqnl.html


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## ASICK (14 April 2013)

Tyler Durden said:


> Cyprus ain't over.
> 
> 
> 
> More at http://www.smh.com.au/business/cyprus-slips-a-little-closer-to-oblivion-20130412-2hqnl.html




This article discloses a copy of the leaked DRAFT bailout plan for Cyprus:
http://www.guardian.co.uk/business/2013/apr/11/cyprus-bailout-leaked-debt-analysis-bill

but it uses a funny "C" looking currency.


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## drsmith (9 May 2013)

Nigel Farage's view (17/04/2013).

It's quiet tame by his standards.


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