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Cyprus To Sieze 80% ?

Discussion in 'Preparedness & Survival' started by erudne, Mar 29, 2013.

  1. erudne

    erudne The Pie Matrix PPL Say Sleeping W/Your Rifle Is A bad Thing? Bronze Supporter

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    Cyprus Finance Minister: Uninsured Laiki Depositors Could Face 80% HaircutPublished March 26, 2013
    Dow Jones Newswires
    Cyprus's finance minister said Tuesday that large deposit holders at Cyprus Popular Bank PCL (CPB.CP), the island's second biggest lender, could face losses of as much as 80% on their deposits as the government moves to wind down its operations.

    Speaking in a television interview with state broadcaster RIC, Michalis Sarris indicated that it could also take years before those depositors see any of their money returned.

    "Realistically, very little will be returned," Mr. Sarris said.

    Asked if, like in other bank closures, it could take six to seven years before depositors get back there money, he said: "maybe yes. And the amount [returned], could be 20%. Certainly, for depositors above 100,000 euros it could be a very significant blow."

    His remarks come just hours after Cyprus's central bank governor estimated that the losses facing large depositors at rival Bank of Cyprus PCL (BOCY.CP), could reach as much as 40%.

    Early Monday, Cyprus agreed to a 10 billion euro ($13 billion) bailout from its euro-zone peers and the International Monetary Fund in exchange winding down Cyprus Popular, also known as Laiki, and the merger of its healthy assets with Bank of Cyprus.

    Cyprus's banks have been closed since March 16 and are scheduled to remain closed Wednesday as the country raced to complete a deal on the aid package and avert a meltdown in the island's financial sector. Mr. Sarris said the banks would reopen Thursday, as scheduled.

    Fearing a mass exodus of deposits when they do, the government of Cyprus is preparing to implement capital controls--the first euro-zone member to do so--to keep money from rushing out of the country. Mr. Sarris said he expected a decree implementing those capital controls to be ready by midday Wednesday

    Read more: Cyprus Finance Minister: Uninsured Laiki Depositors Could Face 80% Haircut | Fox Business
  2. 1stklass

    1stklass salem oregon Well-Known Member

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    Never leave any amount of money in the bank.
  3. knuckle Head

    knuckle Head southeast Well-Known Member

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    I hope everone is paying attention to what is going on here, what we are witnessing is people who have now control over their spending habits stealing from their friends, neighbors, relatives etc to pay their debts.

    Now if you have provisions of any type set aside and have told anyone, what do you think is going to happen when shtf??????

    Those who were to lazy, who could not turn down going out to lunch, out to dinner, to the movies, to a ball game, those who had to have the latest electronic gadgets when they first hit shelves and $1200.00 instead oof waiting six months and $150.00 It is those people your neighbors, co-workers, supposed friends and relatives who are going to banging on your doors demanding you let them and feed them and if you do not they will be bringing the sheriff in to steal it from your descipable arse for hoarding and not sharing, just because they did not share their vacation money, steak dinners, movie/ theater/ ball park tickets with you, is no excuse for you not sharing with them.

    I really hope those who find it necessary to discuss these things with others who are not part of their prepper group realize they are setting themselves up to have a Cyprus pulled on them but they will not have 40%, not 80% but more like 99.5% or the entire 100% taken from them.
  4. tfbit

    tfbit Eugene, OR Active Member

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    And that is one of the things a gubermint can do to a disarmed population.
  5. KTM530XCW

    KTM530XCW Vancouver, WA Well-Known Member

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    ↑ ...one of the HUNDREDS of things.
  6. erudne

    erudne The Pie Matrix PPL Say Sleeping W/Your Rifle Is A bad Thing? Bronze Supporter

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    Saturday, March 30, 201325 Lessons from Cyprus

    By Tyler Durden of ZeroHedge
    There are many lessons and implications from the Cypriot crisis (we list 25 here). Among the most important is that conditionality is back, energetically, which is very important when considering the circumstances under which other, bigger, countries might access ESM or OMT. We believe, like BNP's James Mortimer-Lee, that the market has been too complacent, seeing OMT and “whatever it takes” as unconditional – that’s wrong.

    A second lesson is that a harsher line is being taken by the core. This partly reflects more effective firewalls, so that core countries are more willing to “burn” the private sector, where doing so does not represent a serious systemic risk. Cyprus may not be a template, but we have seen enough to glimpse what the new pan eurozone bank resolution system could look like. Risk for certain classes of stakeholders in banks has risen. We are a long way from seeing the eurozone crisis resolved.
    Via Paul Mortimer-Lee, BNP Paribas,

    There are many lessons to be learned from the Cyprus bailout, and plenty of implications for how things may develop in the future. We list 25 here, but there are more.
    Lesson 1: Do not underestimate the ability of the eurozone to do the right thing – after all the alternatives are exhausted;

    Lesson 2: Eleventh hour deals can often lead to mistakes and have unintended consequences. The decision to haircut depositors under EUR 100k was a pothole the Troika fell into. It questioned the integrity of the EUR 100k deposit guarantee;

    Lesson 3: The disappearance of Mario Monti from the scene has reduced the influence the South has on decisions about the future of the euro;

    Lesson 4: There appears to be bailout fatigue in Germany, the Netherlands and Finland. Mrs Merkel is prepared to be tougher ahead of the election than many thought;

    Lesson 5: The new Chair of the Eurogroup, Mr Dijsselbloem, seems to be a hardliner compared with his predecessor, Mr Junker from Luxembourg;

    Lesson 6: Mr Dijsselbloem can sometimes be too outspoken and not sufficiently diplomatic. Beware future gaffes;

    Lesson 7: The ECB is prepared to use the ultimate weapon – “no more money for your banks”. This is not exactly ejecting a country from the eurozone, but would amount to making it very difficult for it to stay in;

    Lesson 8: Such a threat has profound political implications and is above even Draghi’s pay grade, so must have the backing of Mrs Merkel and others;

    Lesson 9: When a problem is not seen to be systemic, there will be reluctance in Germany and like-minded countries to use taxpayers’ money to solve it. Cost/benefit balancing will ensure each case really is “unique”;

    Lesson 10: This puts private interests at greater risk in absorbing the financial pain, or at least the first tranche of it, especially in small non-systemic countries;

    Lesson 11: “They” (the Troika) will seek to use private money where they can to limit the size of public sector involvement. While each case is unique, the principles are the same. In Greece, government bondholders took the pain; in Cyprus large depositors. Each case is “unique” but there may well be further “unique cases”, each different in its own special way;

    Lesson 12: When it comes to resolving banks’ difficulties there is a hierarchy of who will take the pain: shareholders first, then junior bondholders, then senior bondholders, then large depositors, then the state, then foreign taxpayers;

    Lesson 13: How much pain the private sector will take depends on whether or not a problem is seen as “systemic” or not. The less systemic it is, the more private interests will suffer;

    Lesson 14: Some countries see firewalls as adequate. So they are now prepared to “burn” stakeholders who were previously protected;

    Lesson 15: The probability of direct bank recapitalisation by the European Stability Mechanism (ESM) has gone down;

    Lesson 16: Moral hazard has been reduced;

    Lesson 17: We crossed a Rubicon of sorts when capital controls were introduced in Cyprus. A Cypriot bank euro is not freely exchangeable with German bank euro. The euro area became more fragmented;

    Lesson 18: It may be more difficult to remove capital controls than expected;

    Lesson 19: A precedent for the use of capital controls has been set that can speed up capital flight in a crisis, raising the probability of their subsequent re-use;

    Lesson 20: It would be surprising if larger depositors were not making defensive moves out of weak banks and banking systems. Watch the scale of ECB MROs and ELA operations;

    Lesson 21: The Cypriot economy will see a major recession;

    Lesson 22: The Cypriot programme will, consequently, prove to be too optimistic, there will have to be another;

    Lesson 23: While Draghi has bought time, the fundamental problems in the eurozone are a long way from being solved, and can come back to haunt markets;

    Lesson 24: Do not expect Russia to take the loss with a feeble protest – there will be consequences;

    Lesson 25: Conditionality is very important to the core countries. There is no such thing as a conditions-free bailout. There are no blank cheques and no free access to Outright Monetary Transactions (OMT) or ESM. There is no such thing as a free lunch (unless not having a free lunch threatens the system).

    Courtesy Tyler Durden, founder of ZeorHedge (EconMatters author archive here)

    The views and opinions expressed herein are the author's own, and do not necessarily reflect those of EconMatters.

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