Shock in Cyprus as savers face bailout levy

reply to post by WatchRider


Just to let people now, this is the latest news about the deal, and I seriously recomend zerohedge for abit more reliable news.

www.zerohedge.com...

Some late news indicates that the 'deal' is further away than many hoped (or rumored) earlier in the day. Welt am Sonntag reports that German FinMin Schaeuble exclaimed "I won't allow myself to be blackmailed," adding his responsibility to the stability of the Euro. Simply put, he adds Cyprus must respect the rules, insistent that, "Cyprus is a hard road to go either way; but that is not the result of European stubbornness, but a business model that no longer works." With that as background, Cyprus President Anastasiades will be meeting with the IMF's Christine Lagarde tomorrow morning with talks at a "delicate point," with his spokesperson admitting the situation is "very difficult." The disinformation-to-total-confusion train pushes on forward; beggars can be choosers and 'demanders' won't be blackmailed.

*STYLIANIDES SAYS ANASTASIADES DEPARTS FOR BRUSSELS 7:15 AM
*STYLIANIDES SAYS ANASTASIADES WILL MEET WITH IMF'S LAGARDE
*CYPRUS EUROGROUP MEETING TO BEGIN AT 7 P.M., SPOKESMAN SAYS
*SCHAEUBLE SAYS WRONG DECISION NOW WOULD DO EURO A DISSERVICE
*SCHAEUBLE SAYS CYPRUS MUST RESPECT THE RULES: WELT AM SONNTAG

As I have said before, the only thing that happened so far is that the Cyprus government came to and agreement. This still has to pass the Troika and then needs to be accepted by the European Council. I know what RT/reuters. etc says but they need to update their news because it simply isn't true.

Surely if this taking of money by banks from the accounts of people who bank there would mean that no one in world would ever trust a bank again.
Many people would think twice before leaving their savings with someone who would dip into the money if they felt so inclined.
Is this not a dangerous precedent that could lead to a world wide bank run?
Would this not end all banking?
Would this be a good thing?
Sometimes things need to go wrong.........in order to go right!

It's sure heating up in Cyprus

With its banks indefinitely closed, and capital controls already in place making it virtually impossible any material cash will leave the local bank branches or certainly the island (especially in direction Moscow), gas stations about to shut down due to lack of cash, next it was the turn of the ATMs. Sure enough, as CNBC's Michelle Caruso-Cabrera reports on the ground from Nicosia, moments ago the nation's second largest, and second most insolvent bank, Laiki Bank, announced that withdrawals are now limited to €100. The picture below from MCC shows as an employee takes down old sign that said previous €260 limit. At this pace, in lieu of some grand bargain, we expect it is only hours before the final limit is imposed: withdrawals now limited to €0.

www.zerohedge.com...

The Int'l banksters are really pressing hard to milk the system for all it's worth before they implode the Euro(zone) and people are finally starting to stand up to it.
The European Spring has sprung and it's coming to the U.S. soon too i'm afraid - we're just so far gone.
And to compound all this nonsense is the drumbeating of U.S./NATO into Syria then Iran and it just gets worse.
I can't see Exxon-Mobil and B.P. taking over Iranian oil fields without Russia and China having a say in it, not to mention the start of nuclear war in the Mid-East, then probably spreading to Asia (N. Korea anyone?).

Like the poster above mentioned, ZeroHedge.com is great for financial/economic info without mainstream media spin and disinformation and Shadowstats.com is excellent too.

There sure had been a lot of bad press, blogs and accusations against the rather derogatorically named 'Troika' of funder nations -EU, ECB and IMF, whom are only seeking to stabalize economies.

The troika had NOT demanded or dictated to Cyprus to rob bank depositors of their money. The Troika only request that Cyprus puts up at least $6 billion as its responsibility to ensure that the rest of the nations whom had not govern Cyprus will put up the balance $10 billion to save the country.

It was Cyprus bankers and govt - the elected representatives of the Cyprian People, whom had failed in its duty to depositors and regulatory oversight and led to the disasters happening in Cyprus today.

Yet EU, ECB and IMF who do not rule Cyprus were blamed and slimed. The troika had long warned Cyprus of its banking shortcommings and regulatory controls, and yet were ignored. Although handbooks and manuals on better banking practices, seminars had been held by the troika, unfortunately, it was ignored by Cyprus, who enjoyed the gravy train of HOT money into its shores.

The Cyprus govt claims the HOT money raised its economy and created more jobs.

The truth and reality of HOT money in vast quantities into the economy is that:-

a.) Bankers are obliged to give returns on savings, and thus have to take BIGGER risks to get those returns, as Cyprus is only a small nation, and worse, without resources and industry to justify that kind of returns possible. They took to gambling funds on the INTERNATIONAL MARKETS......and LOST BIG.

Those banks are now....empty. Through their own doing and mismanagement.


b.) Some foolish cypriots and the banking sycophants claimed that HOT money raise their standard of living. Thing is, vast sums were spent on construction of housing projects instead of manufacturing/services and its management.

Property speculation is the easiest form of getting returns as one just buys a few houses, rent it out to get residual income monthly, then sell it away at a profit a year or 2 down to the road, as population increases will cause demand.

But unfortunately, it artificially rises the cost of construction, the cost of properties and rentals. They young seeking to start a family will no longer be able to keep up with such costs, as one HOT money investors does not buy one property, but many.

Extrapoliate to the huge $28Billion to $40 billion dropped onto the small country, inflation shoots up the roof, as hot money circulates way too fast and loose with the economy.

And when the HOT money is lost in the stock markets, so too the mortgages, just like a rug pulled off one's feet. Disaster looms as the tap runs dry, affecting not only the HOT money investors, but local enterprises that had lived off such fats for long and enjoyed those wealth and benefits it brought while other nations in the world undertook painful measures for bank reforms and rebuilding of their economies.

EU, ECB and IMF can just simply walk away and let the banks and Cyprus fall. Why the hassle and get the blame? But it did not and egalitarianly tried to help, and even managed to convince the Cyprus govt to find other ways to not take the money from the common masses, but only the rich if this is the way Cyprus wants to put up that 'responsiblity fund' of $6 billion.

The troika can easily fund the entire rescue, but to if they do so, the Cyprus govt, bankers and cypriots will NEVER learn their lesson, and will only continue to pay lip service to EU as it rages on uncontrollerably to invite more HOT money into its shores with no questions asked, which will only lurch from one looming disaster to another.

Our world is more aware of the disaster that HOT money brings, from the source to the host nation, had experienced it and learnt from it. HOT money are not investments, but are only get rich quick schemes hidden away, by the greedy, corrupted, and selfish few.

May more of our fellow human brothers and sisters in Cyprus be aware and be informed to make rational decisions, and not rash and irrational responses that are often manipulated by others.

The results are out and the pain follows....

One way or another, there is no way to live in delusions as truths are realities will have to be confronted, mistakes made acknowledged so as to be able to correct them to progress.

At least, the Troika had helped to mitigate the pain and suffering of the masses with no tax levy on them, except for the wealthy. If without the Troika's help, EVERYONE would have lost money as the banksters and govt had failed all. Yet the troika is blamed, instead of the real culprits and years of citizens living in apathy and delusions.

Cyprus is a capitalist nation, and capitalism's laws apply. In the past, if a shop or a bank fails, bailouts are not expected, for the blame lays with the entreprenuer, whom must learn, blame none, pick themselves up and try again smarter. It is this manner that had made capitalism thrived.

It is only in recent times that 'bailouts' become popular. But it is unfair, as taxpayers and their future generations are made to pay for others' mistakes. However, to not have bailouts would mean many more suffer later on. What is lost today can always be made back tomorrow. It's only money, not life.

But today, the realization had sunk in that someone must be held accountable for the mistakes and the innocent masses protected. Big honest biz have no reason to keep large funds hoarded in banks, as they would have circulated them in the market for expansion. Only the selfish hoarders do.

May they realized banks are only capitalist institutions and subjected to same risks and laws as any other enterprises. Best cypriots have a smile on their face that the troika had bleeding hearts and had sought to minimize the damage of the cyprus bankers and govt had done to its own people.

To my fellow human brothers and sisters in Cyprus:-

This is not the end, not by a long shot, for the People of Cyprus.

1. For those whom are capable, young or old, should explore the possibilities of oversea jobs. As most grads are in biz lines, they would have no problem finding jobs in new economies such as Asia and Africa, which have strong demands for such skills, knowedge and teaching to its people.

This way, the young and educated need not waste their life living in Cyprus in unemployment or dead end jobs.


2. For the rest, Cyprus is a great tourist attraction, and with being within EU, members can freely enter and stay in Cyprus. Tourism infrastruture should be expanded to absorb more unemployed, in hotels, recreation, services. Retain the best talents to be productive in winning new and more tourists visiting the country, focussing on quantity to build up the economy through honest and quality service, leaving no stone unturn to make that honest dollar.


WIth the revenues comming in and with debt restructuring, Cyprus can pay off its loan over time. And with such revenues, social spending must be given to all but rationalised for only the necessary. Education and diversification of the economy into manufacturing/services is a MUST.to prevent another case of overly dependence upon one single source for the economy - banking.

Those unsustainable days are over, finally, so that all may begin afresh. There will be job layoffs, but if properly managed with proper directions and policies by state, the unemployment can be kept small.

You cypriots are not alone, for the rest of us in the world had to go through even far worse pain for our mistakes. It's not the end, but a new better, honest and sustainable beginning. Good luck! :-)

Just in :

[Cyprus banks to remain closed until Thursday - central bank
The Cypriot finance minister has ordered all countries banks to remain closed until Thursday, the country's central bank announced.

Banks on the debt-stricken island nation had already been ordered to remain closed until Tuesday. The postponement could be a sign that the country's banks are even lower on cash than they believed at the end of last week.

DETAILS TO FOLLOW

Are they gonna starve the people to death or what? This is really getting insane.. can u imagine the damage this inflicts on Cyprus...

Originally posted by Senduko
Just in :

[Cyprus banks to remain closed until Thursday - central bank
The Cypriot finance minister has ordered all countries banks to remain closed until Thursday, the country's central bank announced.

Banks on the debt-stricken island nation had already been ordered to remain closed until Tuesday. The postponement could be a sign that the country's banks are even lower on cash than they believed at the end of last week.

DETAILS TO FOLLOW
[/quote

Are they gonna starve the people to death or what? This is really getting insane.. can u imagine the damage this inflicts on Cyprus...

I can't believe they're keeping ALL banks closed, not just the ones in trouble. Wow. They know there's going to be a massive bank run so they're going to continue keeping them closed until they can't any longer. The only problem is that the longer they're closed the angrier Cypriots get (and rightfully so!) and the more likely there's a huge bank run!

reply to post by texasgirl


I like to think so to. Someone added it might be because the banks simply havn't enough money left.

The central bank now says all will remain closed to ensure the whole banking system functions "smoothly".

The bailout deal will see larger depositors in the two biggest banks, Bank of Cyprus and Laiki, lose money.

Could someone please put this in english? Will see larger depositors?

reply to post by Senduko


It appears the Russian may have already gotten their cash out.

Russia maybe "taxing" German companies based in Russia.....and for the headshot of the day:

Finance Minister stated that the Cyprus deal may be a template for other nations.

reply to post by MidnightTide


Yeah I know been following the whole cyprus thing up the minute. Also word that Russia might freeze up German money/bonds.

That comment Diesel Boom made and what effect it had on the market just shows how fragile the EU is now.

reply to post by Senduko


Congrats on your recent share increase with those guys at ZHF

BBC is backing the government's decision?

www.bbc.co.uk...

BBC are globalist flunkies, of course they are going to agree with what the man says.

At this point, looks like the good guys are the Russian mafia types. What a world we live in.

As MidnightTide pointed out, the Russians may have managed to pull out all their money from Cyprus while the banks were "closed".

So while one could not withdraw from Bank of Cyprus or Laiki, one could withdraw without limitations from subsidiary and OpCo banks, and other affiliates? Just brilliant.

Zerohedge.com: Russians Withdrawn All Their Cash From Cyprus?

If true, then Cyprus are going to have to recalculate how they think they are going to raise 5.8 billion euros (their end of the bailout package). Even if they manage to get the bailout, they are still finished. The shredded banking sector was a huge part of the Cypriot economy. "Cyprus is Saved !" type headlines yesterday, where frankly ridiculous, and just serve to remind analytical minds how skewed the MSM can be.

I personally can't see this kind of money grab being rolled out to other countries in Europe. Not in the Cypriot format anyway. It has been an unmitigated disaster that is in the process of destroying a nation. Lesson will be learned. One unintended knock-on effect will be a slight worldwide drop in bank deposits and the uptake of hard assets.

I have to admit I am a financial apocalypse doomer. However, one or two more Euro nations are going to have to go under before I start "prepping". There are no signs of massive contagion at this point.

Weekly cash withdrawal curbs incoming!

ATM machines are restricted to a few dozen Euro's at a time!

Something's gotta give...

www.bbc.co.uk...

US BACKS CYPRUS WITH BILLIONS OF CASH IN BAILOUT MONEY!

www.kuna.net.kw...

reply to post by WatchRider


That's just wrong... Any other sources that can confirm this? Don't get me wrong its not that I don't believe you, but its highly unlikely that this went unnoticed.

The banks in Cyprus are now open for business!

rt.com...

I hope folk there aren't leaving too much money in this time....

Banks in Cyprus have reopened to the public for first time since March 16. However, withdrawals are limited to 300 euros ($385) a day to prevent the "collapse of credit institutions." The strict controls were imposed as Cyprus struggles to raise 5.8 billion euros to qualify for a 10-billion-euro bailout from the EU, European Central Bank and the IMF – the so-called ‘Troika.’ Deposits of over 100,000 euros will be taxed in exchange for bank shares. An earlier plan to tax smaller depositors was vetoed by the Cypriot parliament last week. Among other limitations, clients are not able to cash checks or take more than 1,000 euros out of the country. Cyprus stock exchange is to remain closed till next Tuesday.