Cyprus bail out deal

hmmm

makeorbrake wrote: »

However, there is a logic in treating the sub 100K deposit holder much more compassionately than those in the higher deposit-holding categories.

Compassion shouldn't come into it. Those on less than 100k should have received every penny of their money (in theory) under deposit protection rules. This has been called a "tax" purely to get around those rules. The whole system of deposit protections has been blown away - the next time there is any sign of strain in a bank, anywhere, a rational depositor with any amount in the bank will withdraw their money.

hmmm

Hootanany wrote: »

I think if this goes thru there will be a massive run on all the Banks in the EU.

It is going through, and it would have happened today if there was going to be a run in response. It will increase the likelihood of future runs however.

woodoo

RoverZT wrote: »

Of course it could.

If we need another bailout it probably will happen.

Good job i have nothing in the bank and won't have for quite some time. But its a scary development. The only thing it might have going for it is if it can capture some of the money of the super rich. But they probably get out in time.

Hootanany

Their Banks do not open till Thursday ours Tomorrow,we shall see.

anncoates

What the hell do you think imposing an arbitrary 'social charge' and 'property tax' on people's wages to cover guaranteed bank debts amounts to,?

Why is that quantitively different to imposing a charge on savings?

darkhorse

anncoates wrote: »

What the hell do you think imposing an arbitrary 'social charge' and 'property tax' on people's wages to cover guaranteed bank debts amounts to,?

Robbery.

flutered

the cyprot banks have been shut down since friday, but i assume the wide boys with the bulging accounts had made arrangements, they always seem to know, also they are able to stay wan step ahead of the possee.

woodoo

Wouldn't it be great if Portugal were to do it. We would have a very unhappy owner of a large media organisation getting hit

Amberman

Look on the bright side. At least you now know for a fact that when push comes to shove, private property rights are just private property "privileges" granted to us by the Eurocrats.

Thank heavens for Bitcoin!

Hootanany

woodoo wrote: »

Wouldn't it be great if Portugal were to do it. We would have a very unhappy owner of a large media organisation getting hit

Gives us a clue.

Amberman

Scofflaw wrote: »

It's hardly surprising, surely? Europe is currently dominated by centre-right governments. That means the EU, and most of the Member States individually, are centre-right. The few left-wing governments that are being elected are in a minority, so of course you get protection of the markets at the expense of the public as a general framework, rather than vice-versa.

Trying to frame this as a left-right situation is laughable.

Its the captured political class and the banks versus everyone else. NuLabour started the whole global recapping of banks...and you could hardly call them center right...but Tony Blair got a plum job at JPM when he left office.

See how that works?

Amberman

Scofflaw wrote: »

It is on a sliding scale - 5% under €100k, 10% €100-500k, €13% over €500k last offer I heard.

The reason depositors are being hit seems to be that there are no bondholders to speak of. So the depositors are not being burned to save bondholders, they're being burned to save themselves.

cordially,
Scofflaw

Property rights are being destroyed to keep Merkels lection hopes alive more like. Politically, she can't afford another bail out with the rising anti bailout parties in Germany...so...screw property rights.

Scofflaw

Amberman wrote: »

Trying to frame this as a left-right situation is laughable.

Its the captured political class and the banks versus everyone else. NuLabour started the whole global recapping of banks...and you could hardly call them center right...but Tony Blair got a plum job at JPM when he left office.

See how that works?

Er, I don't see a problem with describing New Labour as centre-right, actually. They were pro-market and recapped the banks, which are market structures, at the expense of taxpayers. I appreciate there are idiots who describe bank recaps as "socialism", but that's because they have no idea what they're saying.

cordially,
Scofflaw

Scofflaw

Amberman wrote: »

Property rights are being destroyed to keep Merkels lection hopes alive more like. Politically, she can't afford another bail out with the rising anti bailout parties in Germany...so...screw property rights.

I don't think it has anything to do with Merkel's election chances - it has to do with getting yet another bailout past the German parliament.

cordially,
Scofflaw

Bullseye1

Scofflaw wrote: »

It is on a sliding scale - 5% under €100k, 10% €100-500k, €13% over €500k last offer I heard.

The reason depositors are being hit seems to be that there are no bondholders to speak of. So the depositors are not being burned to save bondholders, they're being burned to save themselves.

cordially,
Scofflaw

Well there is an easier way to protect the depositors, allow them withdraw their deposits.

coolshannagh28

Given that the savings rate in the Irish economy is now running at an unhealthy 14 % which is killing domestic demand ,particularly in light of the fact that much of this has been introduced by the troika bailout, is it time for a much higher tax on savings here as well.

Bullseye1

Interest rates are so low it's hardly worth ones while having a standard deposit account here. That and your already with dirt.

snaps

What options would we have here to open a foreign bank account? How would say an online rabo direct account fair? Just thinking if I wanted to move my savings?

Bullseye1

Bertie had the right idea after all LOL.

shedweller

I asked this in another forum but here should (will?:o) give a better answer.
If the SHTF will my money be any safer in the credit union?

woodoo

Hootanany wrote: »

Gives us a clue.

Even the mere mention of his name would land you in court for slander

RoverZT

shedweller wrote: »

I asked this in another forum but here should (will?:o) give a better answer.
If the SHTF will my money be any safer in the credit union?

Small print probably includes credit unions, building societies, an post, prize bonds, savings bonds, saving certs etc.

No you wouldn't be safe imo.

Credit union do have a fund of 100 million or so for extra protection.

They are not exactly well run so I wouldn't pay too much attention to that.

ArmaniJeanss

snaps wrote: »

What options would we have here to open a foreign bank account? How would say an online rabo direct account fair? Just thinking if I wanted to move my savings?

I would 100% expect that a Rabo online account opened from Ireland woud be treated as just being an Irish bank account.

shedweller wrote: »

I asked this in another forum but here should (will?:o) give a better answer.
If the SHTF will my money be any safer in the credit union?

Assuming you mean if similar legislation was brought in here down the road would credit unions be included or not? Genuinely not sure how you can get any credible answers to that sort of question. I'd assume any legislation would be covered in enough legalese to cover bank accounts, post office account, credit union accounts etc, but who knows.

Amberman

snaps wrote: »

What options would we have here to open a foreign bank account? How would say an online rabo direct account fair? Just thinking if I wanted to move my savings?

I love Bitcoin and have just started a regular monthly savings schedule for the next decade. Great solution for me...small, known fixed increase in supply coupled with exploding demand. (check google trends). Will almost certainly suffer the odd 50% plus crash, but they've been pretty short lived to date...typical of a raging bull market.

Amberman

Scofflaw wrote: »

I don't think it has anything to do with Merkel's election chances - it has to do with getting yet another bailout past the German parliament.

cordially,
Scofflaw

I cordially disagree

http://www.google.com/trends/explore?hl=en#q=Bernd%20Lucke

RoverZT

shedweller wrote: »

I asked this in another forum but here should (will?:o) give a better answer.
If the SHTF will my money be any safer in the credit union?

Another interesting point and very bad timing for ous

Deposit Guarantee Scheme is almost up.

From the 29th March 2013 the following will apply:

Current Accounts & Demand Deposit Accounts:

Funds in these accounts will no longer be covered by the ELG.

From midnight 28th March, 2013, no new deposits made with Allied Irish Banks (AIB) plc, Bank of Ireland (BOI) plc, Permanent TSB plc or their subsidiaries EBS ltd. and ICS Building Society will be guaranteed under the Eligible Liabilities Guarantee Scheme

http://www.irishdeposits.ie/Guarantee_schemes

**** just got real.

If you have money get it out of Europe or if you were an idiot like with my little savings of 10k and put it into a fixed term deposit account your are ****ed.

I am really pissed off with myself for doing that, it's only 10k, but its years of savings for me.

hmmm

RoverZT wrote: »

Deposit Guarantee Scheme is almost up.

It's only the ELG that is ending, for amounts of over 100k.

RoverZT

hmmm wrote: »

It's only the ELG that is ending, for amounts of over 100k.

Oh right and under 100k?

The big boys will be getting very jittery then.

noodler

hmmm wrote: »

It's only the ELG that is ending, for amounts of over 100k.

Yes, just to reiterate...the ELG is for deposits over 100k.

All personal accounts below 100K are guaranteed indefinitely under the DGS.

And that is 100K per account.

So if you have more than 100K just split it into smaller sizes in different banks and it is still covers.

hmmm

RoverZT wrote: »

The big boys will be getting very jittery then.

Not really, its ending has been flagged a long time in advance and deposits are returning to Irish banks. The ELG guarantee was only put in place as an exceptional measure, and never really did the job anyway.

Millerz

Is there any way, we, the small depositors could take steps to protect our savings in Banks. I thought we were protected by Deposit guarantee up to 100k? If you took ur money out of the Bank where could they not touch it , avoiding a Cyprus 6.75% grab plus . The already getting the dirt tax of 33%

Amberman

Scofflaw wrote: »

Er, I don't see a problem with describing New Labour as centre-right, actually. They were pro-market and recapped the banks, which are market structures, at the expense of taxpayers. I appreciate there are idiots who describe bank recaps as "socialism", but that's because they have no idea what they're saying.

cordially,
Scofflaw

Would you call it capitalism?

I wouldn't.

Chucky the tree

How/when did things starting going south for Cyprus?

noodler

Chucky the tree wrote: »

How/when did things starting going south for Cyprus?

The majority of the 17bn they need to raise (via despositors, subordinate bondholders and the EU/possibly IMF) is for their banks.

When the Greek deal was done it burned private sector holders of Greek sovereign debt - Cypriot banks held alot of this and were burned badly.

Bullseye1

Looks like they EU has backed down on the issue. Talk about a farce.
http://m.eircom.net/news/article/?type=breaking&storyid=21051524

pipie

woodoo wrote: »

People are queuing at the ATM's trying to take out as much money as then can before this comes in on Tuesday.

Actually they have all the transactions dated for tuesday, (or now the date of effect is thursday maybe its been altered to Thursday) the tax/theft will be retrospective from the time it was announced. Also lock down are online transactions, etc....

Rightwing

pipie wrote: »

Actually they have all the transactions dated for tuesday, (or now the date of effect is thursday maybe its been altered to Thursday) the tax/theft will be retrospective from the time it was announced. Also lock down are online transactions, etc....

As a previous poster alluded to, it looks like under €100K is safe now. But there's no certainty that the party will have enough support to get this through even for above the 100K figure,,,,then we are in default territory or the Troika will have to back down.

darkhorse

woodoo wrote: »

That's it. Its really just another way of getting the same money of people. It just feels a lot more like robbery. In Ireland we get a property tax with nothing in return. It all amounts to the same thing.

Have ya seen this. Should we be afraid.



Enda Kenny: Cyprus bank levy will have no effects in Ireland




What usually happens when this man says something. You guessed it, the opposite.

darkhorse

shedweller wrote: »

I asked this in another forum but here should (will?:o) give a better answer.
If the SHTF will my money be any safer in the credit union?

No.

Scofflaw

Amberman wrote: »

Er, I don't see a problem with describing New Labour as centre-right, actually. They were pro-market and recapped the banks, which are market structures, at the expense of taxpayers. I appreciate there are idiots who describe bank recaps as "socialism", but that's because they have no idea what they're saying.

Would you call it capitalism?

I wouldn't.

Shrug - I can't see why it wouldn't be called capitalism. It's not left-wing because the reason banks are being protected is that they are market utilities, and the market is idealised as the way to provide the best outcome - that's right-wing pro-market thinking, although obviously, since a government bailout is involved, it's not free market thinking either.

A properly left wing response wouldn't involve saving the banks at the expense of the taxpayer, because in a proper left wing schema the banks are little more than parasites on the wealth of others.

None of which is relevant to my original comment that European governments are favouring austerity and fiscal discipline as a response to the crisis because they're mostly right of centre.

cordially,
Scofflaw

Scofflaw

shedweller wrote:

I asked this in another forum but here should (will?) give a better answer.
If the SHTF will my money be any safer in the credit union?

That depends on whether the credit union you have your money in needs to be bailed out. The Cypriot depositor levies are in the banks that are being bailed out (probably, as I've been reminded below!).

cordially,
Scofflaw

pipie

Scofflaw wrote: »

That depends on whether the credit union you have your money in needs to be bailed out. The Cypriot depositor levies are in the banks that are being bailed out.

cordially,
Scofflaw

Where do you get this info?
There are dozens of EU and non EU banks and bank branchs in Cyprus, for example...the Romanian bank "Banca Transilvania" is not as far as I know being bailed out, but their Cypriot branches are in lock down too, I believe it is all bank accounts registered in Cyprus? but I stand to be corrected..
http://cyprus.bancatransilvania.ro/index/607.html

Scofflaw

pipie wrote: »

Where do you get this info?
There are dozens of EU and non EU banks and bank branchs in Cyprus, for example...the Romanian bank "Banca Transilvania" is not as far as I know being bailed out, but their Cypriot branches are in lock down too, I believe it is all bank accounts registered in Cyprus? but I stand to be corrected..
http://cyprus.bancatransilvania.ro/index/607.html

I'm open to correction myself - it's from reading the news surrounding the bailout deal, but it's true that I'm probably being over-definite there, given the fluidity of the situation. As far as I could see, the levy is on the banks being bailed out, but I'm not sure it's not a case of all the Cypriot banks being bailed out - I know subsidiaries of Greek banks are exempt, and I can't see how they can exempt Greek bank subsidiaries and not other EU bank subsidiaries:

Romanian bank Banca Transilvania, which has subsidiaries in Cyprus, told clients that transfers from the bank’s accounts in Cyprus to other countries, including to Banca Transilvania in Romania, are temporarily suspended, following the Eurogroup decision. It is yet unclear if the move will affect deposit holders in subsidiaries of foreign banks, as so far only subsidiaries of Greek banks were exempt from this tax. The offshore industry will most likely be affected, and Romania has around 5,100 offshore companies registered in Cyprus.

cordially,
Scofflaw

Amberman

Scofflaw wrote: »

Shrug - I can't see why it wouldn't be called capitalism.

Capitalism is broadly based on creative destruction...so preventing that destruction from happening means that this isnt capitalism. The factors of production werent released from the flawed companies who misused them and went bust. I agree that it isn't socialism either.

What has happened has been described as corporatism...a symbiotic relationship between state and key corporations, accurately I think. I like that definition better.

maninasia

snaps wrote: »

so the banks could be closed until they decide what to do. Very democratic of them I must say. So the poor deposit holders have no choice than to take this hit. If it were me and id been saving in drips and drabs for along time, just to have it robbed from me, I would be mad as hell. I'm still thinking about doing something with my savings here now, because its been done before it could happen again. And quite frankly, there's not much more to tax here now.

Seriously, what's the difference with taxing salaries?
To me that's the most unfair tax of all, you work hard, then you get taxed on it, and it goes to people that have possible never worked at all.

Bit of perspective works wonders.

Amberman

maninasia wrote: »

Seriously, what's the difference with taxing salaries?
To me that's the most unfair tax of all, you work hard, then you get taxed on it, and it goes to people that have possible never worked at all.

Bit of perspective works wonders.

Savings are created from net of tax salaries. Savings balances were supposed to be private property...immune from arbitrary confiscation at the whim of the Elites for their pet causes.

maninasia

But if you think about it a tax on salaries is more unfair than a tax on what is in somebody's bank account. Tax on salaries is definitely a tax on somebody's labour, whereas a tax on money in a bank account could be illicitly procured money, a gift , inheritance etc etc. I'm not saying it's good to be taxed, but it is certainly no worse than the system that applies at present, it's just that everybody is trained to accept the current system.

makeorbrake

maninasia wrote: »

it's just that everybody is trained to accept the current system.

You're quite right in so far as it now seems to be accepted practice that ordinary deposit holders get burned regardless of the circumstances that brought the bank down in the first instance. This 'accepted practice' is what needs to change. Investors in a banking business (to include bondholders) should be burned completely - NOT customers of that business! They benefit fully from the upside of the activity of that bank - and they should be exposed fully to the downside risk also.

hoodwinked

makeorbrake wrote: »

NOT customers of that business! They benefit fully from the upside of the activity of that bank - and they should be exposed fully to the downside risk also.

but aren't customers also taking a risk by leaving their money in that business/bank?

do they not benefit from good interest rates on their accounts in the good times?

makes sense they'd need to be exposed to the downside risk also?

they never had to lodge their money in those banks, they chose to, there are other financial institutions, or even just hanging onto to the cash in general, they chose to put it into an account with a good interest rate in the good times, they are now in the bad times, they need to account for that too,

and if they did just throw it in there assuming things to stay the way they were, their assumptions and incompetence are being punished via this tax.

maninasia

makeorbrake wrote: »

You're quite right in so far as it now seems to be accepted practice that ordinary deposit holders get burned regardless of the circumstances that brought the bank down in the first instance. This 'accepted practice' is what needs to change. Investors in a banking business (to include bondholders) should be burned completely - NOT customers of that business! They benefit fully from the upside of the activity of that bank - and they should be exposed fully to the downside risk also.

Not all banks are the same, in the case of Cyprus they were offering high interests to attract depositors, they also didn't ask many questions about where the money came from.