… Congratulations Cyprus savers – you were just betrayed by both your politicians, and by Europe – sorry, but you are the “creeping impairments” in the game known as European bankruptcy. And so is anywhere between 6.75% and 9.9% of your money, which you were foolish enough to keep with your banks (where at least you were compensated with a savings yield of… 0%).
More importantly, as of this morning Europe has finally grasped that there is a 6.75% to 9.9% premium to holding physical cash in your mattress rather than having it stored with your local friendly insolvent bank.
Luckily Cyprus is so “small” what just happened there will never happen anywhere else: after all in Europe nobody has ever heard of “setting an example”. Or so the thinking among Europe’s unthinking political elite goes.
And congratulations Europe: just when people almost believed you things are “fixed” you go ahead and prove to the world that you are as dis-unified (because size doesn’t matter in a true union), as confused, as stupid and as broke as ever…via …Saver “Panic”, Frozen Assets, Bank Runs, Broken ATMs | Zero Hedge.
Responding to this ZerHedge article, Ann Barnhardt posted this:
Finance: The Cypriot Confiscation is Terrifying. Posted by Ann Barnhardt – March 16, AD 2013 9:27 PM MST
Yes, it is every bit as bad as it sounds, and worse. Word is that the initial plan was for a 40% (!!!!) levy confiscation of Cypriot bank accounts. They settled for a MERE 6.75% and 9.9% dual-layered compromise.
Yeah, you all need to do what I have been doing for the last several months and live within spitting distance of being overdrawn in your bank accounts. In other words, keep the BARE MINIMUM in the bank and feed your account just enough to cover the bills. As soon as money comes in, get it the heck out of there.
Looks like the IRS may prove to be the least of my worries with regards to levying bank accounts!
This has the potential to spark bank runs in other Southern European nations MERELY BECAUSE OF THE FACT THAT IT ACTUALLY HAS HAPPENED. Pray the Greeks, Italians, Spaniards and Portuguese are all watching talent shows or soccer and don’t notice. But if it does, if you have watched my eight-part economic presentation on YouTube, then you understand that we will blow sky-high as the big banks and their tens of trillions of dollars in repos and reverse repos and credit default swaps, many-to-most of which are written on European sovereign debt, blow.
… UPDATE: I agree with various commentators that this is almost certainly a test-run by Brussels to see what the reaction of the Cypriots is. If no one is hanging from light poles by sunset on Tuesday, they will likely move on to Greece and the other Southern European economies, satisfied that the people have been sufficiently conditioned to roll over. Tiny Cyprus, an ISLAND mind you, makes the perfect test lab.
I anticipate that the light poles will remain undecorated. There is no fight left in the men of former Western Civilization; only indifference punctuated by self-loathing. Say goodnight, Gracie.
“… bankers are greedy and have been for 1000 years” and “nothing is going to change” unless there are criminal sanctions; to which he follows up – briefly silencing the interviewer, “If some people end up in jail, maybe that will teach a lesson to somebody – or somebody will hang in the streets“. The professor goes on to note that the EU “summit was a failure” since markets were expecting much more and warns that without full debt mutualization, debt monetization by the ECB, or a quadrupling of the EFSF/ESM ‘bazooka’; Italian and Spanish spreads will continue to blow out day after day – leading to a crisis “not in six months but in two weeks“. The only entity capable of stopping this is the ECB which needs to do outright unsterilized monetization in unlimited amounts which is ‘politically incorrect’ to talk about and claimed to be constitutionally illegal. 2013 will be a very difficult year to find shelter as policy-makers ability to kick-the-can runs out of steam as he sees the possibility of a ‘Global Perfect Storm’ of a euro-zone collapse, a US double-dip, a China & EM hard-landing, and a war in the Middle East. Dr. Doom is back.” via ZeroHedge
An independent global think tank, LEAP/E2020, recently reported the opinion that “this second half of 2012 will really mark a major inflection point of the global systemic crisis;” “The shock of the autumn 2008 will seem like a small summer storm compared to what will affect the planet in several months.”
In fact LEAP/E2020 has never seen the chronological convergence of such a series of explosive and so fundamental factors (economy, finances, geopolitical…) since the start of its work on the global systemic crisis. Logically, in our modest attempt to regularly publish a “crisis weather forecast”, we must therefore give our readers a “Red Alert” because the upcoming events which are readying themselves to shake the world system next September/ October belong to this category. Continue reading
… They think the path of a full-blown crisis would start in Greece, quickly move to the rest of Europe and then hit the U.S. Stocks and oil would plunge, the euro would sink against the U.S. dollar, and big banks would suffer losses on complex trades…
- ACT I. What would Greece’s exit look like? In the worst case, it starts off messy.
- ACT II. Here’s where things get scary.
- ACT III. A full-blown crisis would cross the Atlantic through the dense web of contracts, loans and other financial transactions that tie European banks to those in the U.S., experts say...via News from The Associated Press
As Greece finally succumbs to it’s financial collapse many Greek towns are turning to a bartering system that is similar to what emerges after a SHTF or post-apocalyptic world.
Everyday Greeks are now dropping the Euro at a lightning fast , even before this Sunday’s election, and adopting a bartering system to buy and sell books, eggs, clothes, kids toys and every day essentials that are necessary…
If Raoul Pal was some doomsday spouting windbag, writing in all caps, arbitrarily pasting together disparate charts to create 200 page slideshows, it would be easy to ignore him. He isn’t. The founder of Global Macro Investor “previously co-managed the GLG Global Macro Fund in London for GLG Partners, one of the largest hedge fund groups in the world. Raoul came to GLG from Goldman Sachs where he co-managed the hedge fund sales business in Equities and Equity Derivatives in Europe… Raoul Pal retired from managing client money in 2004 at the age of 36 and now lives on the Valencian coast of Spain, from where he writes.” It is his writing we are concerned about, and specifically his latest presentation, which is, for lack of a better word, the most disturbing and scary forecast of the future of the world we have ever seen….
And we see a lot of those.
Consider this: Continue reading
From the office of Senator Jeff Sessions, ranking member on the Senate Budget Committee.Be sure to pay attention to the footnote which reads:“Under President Obama’s plan, gross federal debt alone would reach $75,000 per capita in 2022.”At the rate we are going, it will reach that point within the next few years. 2022 is overly optimistic in my opinion…via Libertarian News.
“…. On Friday, Standard & Poor’s downgraded Belgium’s credit standing to AA from AA+, saying it might not be able to cut its towering debt load any time soon. Ratings agencies this week cautioned that France could lose its AAA rating if the crisis grew. On Thursday, agencies lowered the ratings of Portugal and Hungary to junk.
While European leaders still say there is no need to draw up a Plan B, some of the world’s biggest banks, and their supervisors, are doing just that…”
… A leaked internal German government memo entitled “The Future of the EU: Required Integration Policy Improvements for the Creation of a Stability Union” actually proposes the creation of a “European Monetary Fund” which would be given the power to run the economies of troubled European nations. This “stability union” would be quickly followed by the creation of a full-fledged “political union”. Essentially, this leaked memo proposes the creation of a “European Superstate” which will be crammed down the throats of the rest of Europe whether they like it or not...
“…This is not going to end well and so far there is nobody talking about what has to actually happen either here or there — that is, whatever services people want from government they must be willing to pay for them with current tax revenues...” via It’s Coming Folks (From Europe) in [Market-Ticker].
Is the US Monetary System on the Verge of Collapse? – David Galland, Casey Research – September 20, 2011 8:57pm GMT
Tune into CNBC or click onto any of the dozens of mainstream financial news sites, and you’ll find an endless array of opinions on the latest wiggle in equity, bond and commodities markets. As often as not, you’ll find those opinions nestled side by side with authoritative analysis on the outlook for the economy, complete with the author’s carefully studied judgment on the best way forward…