Go Back  

BBC News Bank of Cyprus Depositors Could Lose BIG 

Current Rating:

Join NowJoin Now
 
  #1  
Old 03-30-2013, 06:01 PM
Darkest Angel's Avatar
Darkest Angel
Offline:
Born in the USA
Poster Rank:74
100% female
Join Date: Jul 2012
Contributions: 1
 
Mentioned: 77 Post(s)
Quoted: 1785 Post(s)
Activity Longevity
2/20 9/20
Today Posts
0/11 ssss12899
BBC News Bank of Cyprus Depositors Could Lose BIG

Bank of Cyprus big depositors could lose up to 60%
Banks in Cyprus opened on Thursday - for the first time in nearly two weeks.

Bank of Cyprus depositors with more than 100,000 euros (£84,300; $128,200) could lose up to 60% of their savings as part of an EU-IMF bailout restructuring move, officials say.

The central bank says 37.5% of holdings over 100,000 euros will become shares.

Up to 22.5% will go into a fund attracting no interest and may be subject to further write-offs.

The other 40% will attract interest - but this will not be paid unless the bank performs well.

It was known that the wealthiest savers at the Bank of Cyprus would take a large hit from the bailout deal - but not to this extent, the BBC's Mark Lowen reports.

Cypriot officials have also said that big depositors at Laiki - the country's second largest bank - could face an even tougher "haircut". However, no details have been released.

The officials say that Laiki will eventually be absorbed into the Bank of Cyprus.
Mark Lowen

BBC News, Athens

--------------------------------------------------------------------------------
Much of the recent focus has been on wealthy foreign savers - mainly Russians - who will lose a vast chunk in the bailout deal.

But there are plenty of Cypriot depositors, too, who will be hard hit and even more so now than previously thought.

Before leaving Cyprus, I visited the Junior and Senior School of Nicosia, which teaches the British system to 900 children.

School fees are paid into Laiki Bank, taking its deposits well over 100,000 euros. With huge losses, it will now struggle to pay staff salaries.

Those who recently invested proceeds from house sales will also suffer. There's talk of one university with a 6m-euro EU grant in its account.

The Bank of Cyprus holds about a third of all deposits in Cyprus. An enforced loss of up to 60% will have a dramatic impact.

And other indebted eurozone countries will fear this sets a precedent and that they might be next.
The fear is that once the unprecedented capital controls - which are in place of an indefinite time - are lifted, the wealthiest will rush to move their deposits abroad, our correspondent says.

He adds that the larger than expected loss could also have devastating consequences for large depositors such as schools and universities. And it could spread fear in other indebted eurozone countries that Cyprus might set a precedent.

'Loans written off'

Cyprus needs to raise 5.8bn euros to qualify for the bailout, and has become the first eurozone member country to bring in capital controls to prevent a torrent of money leaving the island and credit institutions collapsing.

The original 10bn-euro bailout deal was agreed in Brussels earlier this month. It placed a one-off tax on all customers of Cypriot banks, starting at 6.75% for the smallest deposits.

But this led to mass protests across Cyprus, and the deal was later voted down by the country's parliament. MPs later backed a revised deal.

Cypriot President Nicos Anastasiades has said the financial situation has been "contained" following the deal.

He has also stressed that Cyprus has no intention of leaving the euro, stressing that "in no way will we experiment with the future of our country".


Daily withdrawals limited to 300 euros
Cashing of cheques banned
Those travelling abroad can take no more than 1,000 euros out of the country
Payments and/or transfers outside Cyprus via debit and or credit cards permitted up to 5,000 euros per month
Businesses able to carry out transactions up to 5,000 euros per day
Special committee to review commercial transactions between 5,000 and 200,000 euros and approve all those over 200,000 euros on a case-by-case basis
No termination of fixed-term deposit accounts before maturity

On Thursday, banks in Cyprus opened for the first time in nearly two weeks. Queues formed of people trying to access their money, but the mood was generally calm.

By Friday, banks had returned to their normal working hours and there were no longer reports of big queues.

In a separate development, Cyprus launched an investigation after Greek media published the names of politicians who allegedly had loans forgiven by three Cypriot banks at the height of the crisis.

The Bank of Cyprus, Laiki and Hellenic Bank apparently wrote off loans of millions of euros to companies, local authorities, and politicians from some of the island's biggest parties.

Cyprus Bailout Could Cost Major Depositors 60%
Cyprus says banks to reopen Thursday
27 Mar 2013

Reply With Quote
The Following 3 Users Say Thank You to Darkest Angel For This Useful Post:
gatagato, icheerthebull, mengala
  #2  
Old 03-30-2013, 06:05 PM
Darkest Angel's Avatar
Darkest Angel
Offline:
Born in the USA
Poster Rank:74
100% female
Join Date: Jul 2012
Contributions: 1
 
Mentioned: 77 Post(s)
Quoted: 1785 Post(s)
Activity Longevity
2/20 9/20
Today Posts
0/11 ssss12899
Re: BBC News Bank of Cyprus Depositors Could Lose BIG

Imagine being a large deposit holder & the banks seizing 60% of your holdings to stabilize their finanicial difficulties.I am having a hard time understanding how this is even legal. People would pull their $ out of the banks so fast that collapse would be inevitable. Hopefully, someone can put some light on this subject & explain how this is possible.

Reply With Quote
The Following 2 Users Say Thank You to Darkest Angel For This Useful Post:
gatagato, mengala
  #3  
Old 03-31-2013, 12:19 PM
ices's Avatar
ices
Offline:
My Rank: MASTER GUNNERY SERGEANT
Poster Rank:240
Male
Join Date: Mar 2010
 
Mentioned: 11 Post(s)
Quoted: 662 Post(s)
Activity Longevity
4/20 14/20
Today Posts
0/11 sssss3660
Re: BBC News Bank of Cyprus Depositors Could Lose BIG

It is illegal and they are getting away with it.

All of their promises are not worth anything. Those shares will bottom out and become worthless.

Hedge funds will be in on this because there are still good assets which they can pick apart.

By the time the dust has settled normal people will realise they have lost much more than they thought.

I hate the EU and this should wake people up but no, they still believe in it.

Reply With Quote
The Following 2 Users Say Thank You to ices For This Useful Post:
Darkest Angel, EPIC_FAIL
  #4  
Old 03-31-2013, 11:49 PM
Darkest Angel's Avatar
Darkest Angel
Offline:
Born in the USA
Poster Rank:74
100% female
Join Date: Jul 2012
Contributions: 1
 
Mentioned: 77 Post(s)
Quoted: 1785 Post(s)
Activity Longevity
2/20 9/20
Today Posts
0/11 ssss12899
Re: BBC News Bank of Cyprus Depositors Could Lose BIG

I just don't understand how something so illegal can be allowed to take place!

Reply With Quote
The Following User Says Thank You to Darkest Angel For This Useful Post:
mengala
  #5  
Old 04-01-2013, 02:32 AM
mengala's Avatar
mengala
Offline:
My Rank: MASTER SERGEANT
Poster Rank:381
Join Date: Apr 2010
 
Mentioned: 2 Post(s)
Quoted: 213 Post(s)
Activity Longevity
3/20 13/20
Today Posts
0/11 sssss1898
Re: BBC News Bank of Cyprus Depositors Could Lose BIG

This was an informative and important topic, which ignorant cocksucker gave this thread a one star rating

Reply With Quote
  #6  
Old 04-01-2013, 08:47 PM
Darkest Angel's Avatar
Darkest Angel
Offline:
Born in the USA
Poster Rank:74
100% female
Join Date: Jul 2012
Contributions: 1
 
Mentioned: 77 Post(s)
Quoted: 1785 Post(s)
Activity Longevity
2/20 9/20
Today Posts
0/11 ssss12899
Re: BBC News Bank of Cyprus Depositors Could Lose BIG

Quote:
Originally Posted by mengala View Post
This was an informative and important topic, which ignorant cocksucker gave this thread a one star rating
I just wish more people would read it. I am assuming this is England? If it could happen in one super power it could happen anywhere. Very scary. Foundation shaking scary.

Reply With Quote
The Following User Says Thank You to Darkest Angel For This Useful Post:
AmericanIllusions
  #7  
Old 04-02-2013, 03:37 PM
ices's Avatar
ices
Offline:
My Rank: MASTER GUNNERY SERGEANT
Poster Rank:240
Male
Join Date: Mar 2010
 
Mentioned: 11 Post(s)
Quoted: 662 Post(s)
Activity Longevity
4/20 14/20
Today Posts
0/11 sssss3660
Re: BBC News Bank of Cyprus Depositors Could Lose BIG

Quote:
Originally Posted by darkest angel View Post
I just wish more people would read it. I am assuming this is England? If it could happen in one super power it could happen anywhere. Very scary. Foundation shaking scary.
England?

Nah, its Cyprus, a lot of expats live there however and they are being screwed hard.

The one thing that is ruffling a lot of feathers is the Russian money being locked down for EU theft. Putin does not like the sound of that one bit and neither do the Ruskies caught up in it.

Ill use the $$$ as an example here.

You have 10% 20,000 dollars being claimed by the EU banks, its going to upset you and you hope they dont take anymore.

However 10% of 200,000 dollars? You are going to be royally pissed off and this figure is a small sum compared to what deposits there are in the Cypriot banks.

Imagine them trying to do this in France, a country renowned for its riots for the most inane of things.

The country would burn the EU to the ground, along with itself.

Reply With Quote
The Following 2 Users Say Thank You to ices For This Useful Post:
Darkest Angel, icheerthebull
  #8  
Old 04-02-2013, 08:26 PM
Darkest Angel's Avatar
Darkest Angel
Offline:
Born in the USA
Poster Rank:74
100% female
Join Date: Jul 2012
Contributions: 1
 
Mentioned: 77 Post(s)
Quoted: 1785 Post(s)
Activity Longevity
2/20 9/20
Today Posts
0/11 ssss12899
Re: BBC News Bank of Cyprus Depositors Could Lose BIG

not a pretty picture. thanks for the info

Reply With Quote
  #9  
Old 04-03-2013, 09:52 AM
icheerthebull's Avatar
icheerthebull
Offline:
My Rank: MASTER SERGEANT
Poster Rank:290
Join Date: Jun 2011
Contributions: 3
 
Mentioned: 11 Post(s)
Quoted: 465 Post(s)
Activity Longevity
1/20 11/20
Today Posts
0/11 sssss2802
Re: BBC News Bank of Cyprus Depositors Could Lose BIG

In capitalist west.....



Banks rob you

Reply With Quote
  #10  
Old 04-03-2013, 03:07 PM
icheerthebull's Avatar
icheerthebull
Offline:
My Rank: MASTER SERGEANT
Poster Rank:290
Join Date: Jun 2011
Contributions: 3
 
Mentioned: 11 Post(s)
Quoted: 465 Post(s)
Activity Longevity
1/20 11/20
Today Posts
0/11 sssss2802
Re: BBC News Bank of Cyprus Depositors Could Lose BIG

Bailout, Austerity, Confiscation: Cyprus Reveals the 3rd Phase of the Great Bank Robbery


Yesterday, the people of Cyprus awoke to the news that up to 10% of the cash in their bank accounts was to be confiscated on Tuesday 19th March, as part of an EU deal to bailout banks. This decision, signals the insidious next step of the Great Bank Robbery underway since the Financial Crisis of 2007/8. First Bailout, then Austerity and now direct Confiscation of wealth from the 99% to the 1%.

The Three Steps of the Great Bank Robbery


There have been three distinct phases to the great bank robbery of the banking and corporate class on the 99%.

The Bailout

In the bailout of 2009, the UK government had to guarantee funding to the banking sector, of 101% of GDP. That is, the UK diverted over £2trn of tax payer money (101% of GDP), equivalent to almost 3 times its entire annual budget, to prop up its failed banks. This is twenty years of NHS spending (£106.7bn a year), forty years of education spending (£48.2bn), or five hundred years of job seekers allowance (£4.9bn a year). All that money is going to prop up a derivates market which serves zero social purpose. It doesn’t build things, it doesn’t create things, it doesn’t do anything except repackage debts for fees and notional profits.

The US spent or guaranteed $12.8trn in its bailout package, which is equivalent to almost its entire annual GDP.

This rescue package for Banks, is absolutely unprecedented. If you take just the UK and US figures, ignoring everyone else, you’re at $15trn. How does this compare to other large scale expenditures?

The accumulated debt of the 49 poorest countries in the world: $375bn

The annual amount of extra aid needed to achieve all the Millennium Development Goals on poverty, health, education etc: $150bn

Current global aid levels: $104bn in 2007

The Marshall Plan which reconstructed the whole of Europe after World War II:

Cost: $12.7 billion, Inflation Adjusted Cost: $115.3 billion

The Louisiana Purchase:

Cost: $15 million, Inflation Adjusted Cost: $217 billion

The Race to the Moon:

Cost: $36.4 billion, Inflation Adjusted Cost: $237 billion

The Savings & Loans Crisis:

Cost: $153 billion, Inflation Adjusted Cost: $256 billion

The Korean War:

Cost: $54 billion, Inflation Adjusted Cost: $454 billion

The New Deal which created the welfare state in the US:

Cost: $32 billion (Est), Inflation Adjusted Cost: $500 billion (Est)

The Invasion of Iraq:

Cost: $551b, Inflation Adjusted Cost: $597 billion

The Vietnam War:

Cost: $111 billion, Inflation Adjusted Cost: $698 billion

All of these things combined do not come close to the cost of the bank bailout so far. For all that cash, not a thing was produced and right now those markets are busy running that figure higher without a single piece of regulation applied since the crash.

Bogus Austerity

In order to fund these bailouts, so called ‘Austerity’ programmes have been rolled out across Europe and North America. However, this is not austerity. The government is not tightening its belt. The laws have not been changed to ensure this crisis cannot happen again. Not a single banker, financial institution or regulator has been tried or sanctioned for their role in the crisis.

These Austerity programmes apply only to public spending on….the public. They seek to roll back the post World War II social contract. Funds for social programmes such as health, education and social security are being cut at unprecedented levels, while those funds are diverted to corporate subsidies, outsourcing public services to private companies for profit and now….outright confiscation.

The results of so called ‘Austerity’, which is only in its very early stages, have been catastrophic.

We’ve already looked at Greece, but Greece is not alone. The Red Cross has reported that Food Aid in Europe has now reached its highest levels since 1945. There has been a tenfold increase in people relying on Food Banks to eat in the UK alone. Unemployment and prices are rising, while wages are stagnating or falling across Europe and the US.

Meanwhile, the worlds richest expanded their wealth to record levels last year. This is not just a case of the poor getting poorer and the rich getting richer. The poor are getting poorer in order for the rich to get richer.

Confiscation

The productive capability of the 99% and the real economy have been subordinated to service the debt of the banking sector of the 1%. But with Cyprus, they have crossed the rubicon: a direct confiscation of personal, private wealth from your bank account to bail out banks.

The EU, IMF and European Central Bank have placed conditions on the bailout which would rescue their banks: The Cypriot government must confiscate 10% of the cash in personal accounts worth over £100,000, and 6.75% from everyone else. According to reports, the choice was to adopt the plan or go bankrupt and leave the Euro.

The people of Cyprus then quite rationally staged a run on the bank at the news, only to find the Bank offices closed, the ATMs refusing to dispense more than small amounts and a ban on electronic transfers of money out of the country.

This is a bank robbery, committed by the banks on their depositors.

We Are All Cyprus

Whilst noises are being made that Cyprus is an isolated case, the slightest interrogation of the situation reveals quite the opposite. Where Cyprus goes, we likely all will follow. We are all Cyprus.

The key failings that saw Cyprus go cap in hand to the central banks were a bloated banking sector, exposure to bad debt (primarily Greek but elsewhere) and a crisis in public finances.

Bloated Banking Sector

The banking sector of Cyprus has grown too big relative to the real economy of Cyprus. The banking sector has liabilities worth 835% of the entire annual income of the tiny nation of 1.1m people. Sadly, the bulk of these loans were made to Greece.

However, the UK has a bloated banking sector over 500% the size of its GDP, Japan is more than 200% whilst the US, Germany, France and others exceed GDP aswell with the trend being a rise in the size of the sector relative to GDP.

Exposure to Toxic Assets

Cypriot banks started to bleed money as a principal bond holder of (lender to) Greece. The Greek economy is being eviscerated by bogus austerity policies which have seen unemployment rise to 26% (57% for young people), poverty so endemic that people can no longer afford to bury their dead, a resurgent fascism and it’s young people leaving the country in unprecedented numbers. This total obliteration of the Greek economy rendered the bonds worthless and left Cypriot Banks exposed.

This story should sound achingly familiar to informed citizens across Europe and the US. In fact, the exposure of Cyprus is trifling compared to the nightmare of toxic assets the rest of us are simply waiting to explode.

The financial crisis of 2007/8 was the first in what will be a wave of collapse in the derivatives market. This is where the lid really comes off the whole thing.

The US derivatives market contains $700trn of debts. Global GDP stands at $69.4trn a year. This means that primarily Wall Street and the City of London have run up phantom paper debts of more than ten times of the annual earnings of the entire planet.

Not only can Wall Street not pay it back, the combined earning power of the earth could not pay it back in less than ten years if every last cent of our productive power went solely to pay off this debt.

It is important to note that this debt wasn’t used to invest, it wasn’t used to build roads or schools or hospitals, or create breakthroughs in science and technology or feed the poor. This debt was invented purely to make a small pool of people filthy rich. It was made because banks realised they could effectively print their own money, by creating debt.

Public Debt and Deficit

We are witnessing the deliberate transformation of a private debt crisis into a public debt crisis. Neoliberalism not only caused the Financial Crisis, but also the conditions of public and private indebtedness which made it impossible to resolve.

Cyprus currently has public debts worth 127% of its GDP. While this sounds quite terrible, it’s not far off other countries who have supported their banking sector over their real economy.

The US national debt now stands at over $16trn, more than 100% of its GDP. Public debt, as a percentage of GDP of the OECD countries as a whole (the 34 leading economic powers inc US, UK, Germany, Japan etc) went from 70% in the 1990’s, to more than 100% in 2011 and is estimated to hit 220% by the end of 2013.

This is the result of a coordinated, deliberate policy of reducing tax revenues on corporations and wealthy individuals, increasing corporate subsidies and the privatisation of public services – the costs of which have been hidden from the public by increased public debt.

We’ve hit crisis and it is the public programmes who are taking the blame and the hit rather than the flagrant corruption, the waste of tax payer money, the tax evasion and the bailouts which got us here in the first place.

What Does it Mean for the Rest of Us?

The global 99% need to watch the developments in Cyprus very closely. The government of Cyprus passing this measure will mean the effective end of private wealth for the 99%. It sets the precedent of governments legislating away a person’s right to their own money, at the direct request of this renegade banking system. It says that at the request of the Banks, any government can flip a switch and confiscate money direct from the accounts of its citizens. If anyone was hanging on to Capitalism for the sake of private property and wealth laws….it’s time to give up the ghost. It is over.

It is time to withdraw our money from this system now. We cannot afford to wait for the legislation to hit the shores of Britain, the US and elsewhere. Let us not even indulge in wistful dreams that it won’t happen to us all. It will.

Take Action

<****** width="560" height="315" src="http://www.youtube.com/embed/4Z9WVZddH9w" frameborder="0" allowfullscreen></******>

you can watch this free online and start thinking about what alternatives might look like.

http://www.off-grid.net/ - learn the skills required for self sufficiency and end your dependency on this system. Learn to grow food, build sustainable living structures, grow food and harness renewable energy sources.

Reply With Quote

Powered by vBulletin Copyright 2000-2010 Jelsoft Enterprises Limited.

Search Engine Friendly URLs by vBSEO