A happy outcome in Cyprus!

For the ‘colleagues’…  The Cyprus Mail reports that:

EU funds co-financing Cyprus-based development and growth projects will be exempt from the deposit haircut, communications minister Tasos Mitsopoulos said yesterday.

Mitsopoulos said that the 37.5 per cent haircut on deposits larger than €100,000 held in the Bank of Cyprus would not impact EU funds.

“This development secures the smooth flow of resources from EU funds to Cyprus, and the continuation of any projects underway,” Mitsopoulos said.  He said that the happy outcome was the result of coordinated efforts by the government of Cyprus.

I’m sure every Cypriot depositor, whether an individual or small business owner, who has seen a large chunk of the money they have worked hard to accumulate stolen by the decree of the Cypriot government, European Union, European Central Bank and International Monetary Fund, will be delighted to see that government saw to it deposits in the banks belonging to the favoured few were exempt from confiscation.  A happy outcome indeed.

But then, why should the EU not benefit from the same shady deals that have been quietly arranged for political parties, politicians and their families, senior civil servants and corporate businessmen?  One rule for the elite, penury for the rest.

The moment you put your money in a bank it becomes theirs for the taking.  You’re only a creditor.  Now they’ve established the principle of the game, the only question is one of scale. There is nothing to stop them deciding to hoover up the deposits of those with less than €100,000 on deposit if they call it a tax and confiscate the money before a bank goes under.

9 Responses to “A happy outcome in Cyprus!”

  1. 1 The Gray Monk 30/03/2013 at 6:02 pm

    Considering that, like the Greeks, the Cypriots have lived off the proceeds of EU funds, and spent, like the Greeks, Spaniards, Portugese and Italians, considerably more than they could afford using the rest of the EUs credit card while acting as the money launderers for some very dodgy characters in Russia and several other ‘developing’ nations, why is it a travesty that they must now repay some of it at least? No one forced them or their government to spend as if there was no tomorrow, and, once the financial regulations started to tighten, and the Russian Mafia found their money launderiing under scrutiny, they pulled their money. That is the real problem.

  2. 2 donwreford 31/03/2013 at 6:42 am

    The theft of money from the wealthy in the latest Cypriot bank scam is money going to a bigger fraud operation, the IMF, its all relative if a Russian has a billion dollars in the bank he can afford a loss, this loss just go’s to another bank, they then lend this money out to another country or the same it is not consequential and the same is a recurrence or a deja vu
    The overthrow of the Czars was another scam it was a big scam, the Czars gold disappeared and everyone celebrated Communism, after Stalins purge of millions dead, a return to the capitalist system prevailed, guess who got the Russian gold?
    The central bankers who devise the scams are in London, France, New York, and Germany, and Israel, the same place where the family finance off springs were strategically placed by Nathaniel, after the clean up of stocks from The battle of Waterloo, although Israel at that time still all part of the dream to come.

  3. 3 Peter Whale 31/03/2013 at 3:19 pm

    So Russian billionaires put their money into Cypriot banks, those Cypriot banks put the money into Greek bonds. The German puppet masters in Brussels and elsewhere reneged on the EU backed bonds by declaring themselves risk free and the Cypriot people end up paying the biggest price.Yeah! they sure are feckless.

  4. 4 pjt 31/03/2013 at 7:00 pm

    I don’t quite get why you call it “theft”, at least by EU, ECB or IMF.

    You make a risk investment (put money in a bank that pays higher interest rates than others, because the market knows they are risky). The bank goes bust. Your investment could be lost almost completely. The bank wouldn’t be able to repay what it borrowed from you.

    Then EU and IMF decide to help a bit, but they do it so that only the smaller investors – who probably were more easily duped – up to 100 kEUR get their investment back. Others suffer a loss.

    I think this is capitalism at work. It’s not my job as a taxpayer to guarantee that those who put their money into a high-risk high-interest investment instrument (like a Cypriot bank account) get it all back if things go sour.

  5. 5 Autonomous Mind 31/03/2013 at 9:45 pm

    Cypriot nationals put the money in the bank because it was their local bank. These are people who have worked hard to build up funds, and businesses whose money was set aside for capital, wages, taxes etc. They weren’t overseas speculators looking for a big return on investment.

    The EU and IMF haven’t ‘helped a bit’ – they’ve crashed the Cypriot economy and appropriated money from soft targets, while the supposed money-laundering shady Russians they were after were tipped off and simply flew to overseas branches of the same banks and withdrew all their money. Likewise, politicians, civil servants and political parties have had their debts wiped out and paid for by taxpayers and other depositors.

    If this had been capitalism at work, everyone would have lost in the same way across the board had the banks gone under. What we saw was cronyism and a tax raid on deposits by government before the banks had gone bust. Bondholders were even going to get off scott-free. Additionally the supposed insurance is meaningless, it would not have covered smaller depositors.

    And all this ran contrary to the Cypriot constitution, yet has been rammed through regardless. How, in those circumstances, is it not theft?

  6. 6 donwreford 01/04/2013 at 3:41 am

    Same AM happened in Australia, the Banksia finance company went broke, many said the depositors were greedy for high interest rates, the rates were about one or two cents above bank rates, it was fairly insignificant as far as investment go’s, possible on a hundred thousand dollars you would receive a dollar extra annually.
    Most people invested money as they thought it was not a huge corporate structure but a local bank they had pride in being local.
    A new board took over and presto the money disappeared, only the naive can think it is a natural outcome of fate.
    These disasters are planned by strewed and cunning manipulators of the finance industry, this is what you get degrees in on finance, another way to put it is a degree in high finance and if you excel in corruption you will do well.

  7. 7 Andy Baxter 01/04/2013 at 7:56 am

    could this be the solution? will it be allowed to happen…?will advocates of such succumb to unexplained premature events!

    interesting idea though….and 2015 looks set to be an interesting year…if the whole fiat system doesn’t collapse before then…



  8. 8 pjt 01/04/2013 at 8:05 am

    Cypriot nationals put the money in the bank because it was their local bank. These are people who have worked hard to build up funds, and businesses whose money was set aside for capital, wages, taxes etc. They weren’t overseas speculators looking for a big return on investment.

    I’m sure there were both kinds: speculators and grey money, as well as people who’ve just sold their homes, and businessmen who just didn’t think of the risk and used the bank that was most convenient and promised the best rates. But they weren’t the only options: not all Cypriot banks are bust. If you are investing in excess of 100 kEUR, it would be prudent to think a bit of the bank risks. Let that be a lesson to us all.

    Anyways, it’s not that EU, ECB and IMF have confiscated money. It’s that the two banks themselves ran out of money, because th made very bad investments. The said bodies are providing emergency funding so that small depositors are not deprived of everything. Large depositors suffer losses, and I think that is right, because, as said, as a taxpayer I don’t want to compensate the losses of debtors to banks that have operated as havens for grey and black money.

    And let this be a lesson about that localism as well. If you want to support local institutions, make sure the ones you support are local, independent.

    We had a similar banking crisis in my country about 20 years ago. Many, many local banks went bust. Not really the commercial banks, but local co-op and savings banks that had got a bit greedy, networked a bit too much, expanded a bit too much. My local savings bank, however, had been fiercely independent, and the bank manager was a stubborn, religious, old-fashioned man who was despised by the high-flying city businessmen of the boom years. After the crash, this tiny local bank, which had its balances in order, was one of the few that survived, and it took over several worse-managed ones of the neighbouring area.

    Well, then it has merged to other ones and become bigger, and I actually moved my money elsewhere…

  9. 9 james higham 02/04/2013 at 7:37 pm

    And of course it’s coming our way after the PIIGS.

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