Cyprus Bailout/ EU Bank Run

[twelvethirty]

Not sure how many people are paying attention to this in the states but its a pretty disturbing thing that's been happening in Cyprus over the weekend. Personally if I had money in a European bank I'd be moving it tomorrow morning.

Basically the EU decided to give Cyprus a ₠10B Bailout, but in turn would tax every account under 100k a one time fee of 6.75% and anything over 9.9%, and turn it into "bank shares". This sets a horrible precedent and any confidence people had in their banks is gone. Cyprus has shut the banks through Tuesday and are possibly going to shut them through Friday to delay the inevitable. This is a test case of what could come to larger countries in similar situation such as Greece,Spain,Italy,Portugal.

Whats everyone's thoughts on this? I'm pretty disturbed.

I cant post links yet, but there is plenty of information out there if you wish to find it, forbes bbc and the likes.

[Daerio]

Sounds like straight up thievery to me. I guess it's legal because they're big brother, though.

[Deleted]

it's theft plain and simple. those people with savings in the bank have already paid tax on the money they have earned and i can guarantee you this is going to cause an uproar. they can call it what they want but they have basically frozen all the accounts and taken a percentage of everyone's hard earned money from their savings. theft is theft regardless of how you try to 'rename' it

[Theodon]

The bank screws up and the people with the accounts are the ones who literally pay for the bailout. It's happened before in different ways and it's why most people hate bankers. The extra shocking news will likely be that the people at the top of the employment chain will get a bonus this year for "saving their bank"

There is a small point you've omitted though; they won't just be taxing people with savings under 100k, but also people with saving over 100k by 9.9%

http://www.bbc.co.uk/news/world-europe-21821155

Seems pretty good timing that they are doing this on a holiday too, so people can't withdraw their funds in time to avoid the tax!

[Deleted]

The bank screws up and the people with the accounts are the ones who literally pay for the bailout. It's happened before in different ways and it's why most people hate bankers. The extra shocking news will likely be that the people at the top of the employment chain will get a bonus this year for "saving their bank"

There is a small point you've omitted though; they won't just be taxing people with savings under 100k, but also people with saving over 100k by 9.9%

http://www.bbc.co.uk/news/world-europe-21821155

he said under 100k 6.75% and over 100k 9.9% which is correct, think you must have misread mate

[Daerio]

I have the temptation to say this, so I guess I'm just going to, without trying to make this thread about guns:

I guess it's a good thing guns are banned in Greece, because otherwise somebody might be able to do something about those in charge stealing billions of dollars.

[Theodon]

he said under 100k 6.75% and over 100k 9.9% which is correct, think you must have misread mate

So he did! sorry about that OP. My head feels like it's full of cotton wool today

[Prancing Minstrel]

I have the temptation to say this, so I guess I'm just going to, without trying to make this thread about guns:

I guess it's a good thing guns are banned in Greece, because otherwise somebody might be able to do something about those in charge stealing billions of dollars.

Lol, because the most corrupt bankers on the planet festering away in Wall Street are really being dealt with by American guns.


It's state sanctioned theft, and sets a very scary precedent for other countries now one has possibly gotten away with it.

[Deleted]

My head feels like it's full of cotton wool today

too funny to not point out

yes, let's commence a coup d'état and / or civil war over this with guns. srsly? guns are not the answere here

[Deleted]

Greece is infectious it seems......

[Zoranon]

State sanctioned theft, nothing to discuss sadly.

But this is no act of random malice, the EU knows what it is doing, it wants to destroy Cypriot banking sector because it was a lower taxed competition for mainland EU banks.

But fighting tax havens is pointless, as a wise man once said: Tax havens will exist as long as there are tax hells...

[Mihalik]

I honestly think it's outright highway robbery. Altought I understand the necessity behind it. There is no money and money needs to be found one way or the other to keep the wheels of the economy turning.

But there is a different way. If the different EU members could quit bitching at each other, the Southern European countries would be willing to accept responsability for their failure and accept higher standards for their operation, rationalizing their economy etc. we could finally form a proper centralized EU financial union, moving away from National bonds to EU bonds.

Centralizing the EU, it's the only way to fix our problems and move forward already. The sooner people realize that and find the political will for it, the better for us all.

[mrinvisable2]

because in cyprus banks are stored 80% of russian rich people dirty money and a lot for other countires

[Deleted]

i have no respect for cyprus and hope their terrible banking system falls flat of their conmen arse. I wouldnt have given then 10quid bail out.
The banks over there are nothing but con merchants. Coming from experience of purchasing a house in cyprus (along with 100's of other brits) they did not build it and the banks keep trying to draw money even though it wasnt done through the legal eu procedures, and with ZERO attempt to try and build the properties, urgh.

Conmen - pure and simple, i feel very sorry for the hard working cypriots who have to endure this atrocity.

[Mihalik]

But this is no act of random malice, the EU knows what it is doing, it wants to destroy Cypriot banking sector because it was a lower taxed competition for mainland EU banks.

Again. Instead of admiting local failures of governance and administration people are bitching about some stupid conspiracy. Cyprus ran afoul it's own economy (with a bit of help from Italy and Greece), one could hardly claim it was the Evil EU to blame. And as a fact of matter most banking in Europe is centerd around Great Britain. One cannot expect for the rest of the EU just to cough up that money and randomly donate it to Cyprus, while Cypriots are sitting pretty on it in banks.

[Daerio]

too funny to not point out

yes, let's commence a coup d'état and / or civil war over this with guns. srsly? guns are not the answere here

You're right. Opening your pocket and bending over is the answer. Admitting that you're not going to do anything other than accept your overlord taking his extra 10% tax on all your earnings. (on top of whatever he was taking before, I expect 30-40%+)

[Dezerte]

Sucks, but it's probably the preferable situation over the alternative of a total financial collapse or a deeper recession.

[Deleted]

My first thought is "My god, this is scary and really bodes badly of what's to come" but then I think, we've had plenty of clues as to the corruption of the banks/governments. Bailouts paid by taxpayers, all the while banking execs get larger and larger bonuses, defect their bonuses for tax purposes and get no punishment for any of it.

Not surprised, but pretty unhappy about it.

[Zoranon]

Again. Instead of admiting local failures of governance and administration people are bitching about some stupid conspiracy. Cyprus ran afoul it's own economy (with a bit of help from Italy and Greece), one could hardly claim it was the Evil EU to blame. And as a fact of matter most banking in Europe is centerd around Great Britain. One cannot expect for the rest of the EU just to cough up that money and randomly donate it to Cyprus, while Cypriots are sitting pretty on it in banks.

OH I do not deny that it is Cyprus own fault, the situation they are in now.

All I am saying is that EU seized this chance to destroy unwelcome competition.

[Nevor]

its IMPOSSIBLE to help out broken banks without giving them some money and - no matter what - this comes from the taxpayers!
and you dont even mention the reasons why this was done...

there is a lot of russian (mostly illegal and illegally moved) money parked in cyprus banks (20-50 billion euro)... and it for sure wouldnt make any sense to have all european taxpayers pay for the security of russian money... eu people have to pay enough for neighboring countries already... it would be ridiculous if we now have to pay for rich russian people, too...

another possibility would be to just let the banks go bankrupt... but you can imagine that people would lose A LOT more money than 7-10% like this...

and its also not ok that ALL european taxpayers have to pay for the mistakes the cyprus people (well, their banks and politicians) did... and 7-10% is VERY little money they have to pay for their own faults...

so, in my opinion its a good thing to do this...
BUT they should have arranged the percentages differently...
BELOW 100.000euro = 0%
ABOVE 100.000euro = 10%
ABOVE 1.000.000euro = 25%
that would have helped out the people who really need their money.