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How long before the whole country kick's off? Austerity is one thing, taking 10% of everyones' savings (if parliment vote it through) to re-finance banks, is in my opinion a step to far and asking for civil unrest.
Bonkers. The banks need money so the govt come up with a scheme which will make people take their money away from the banks 😕
The shareholders should have lost their money not the depositors. I wouldn't be surprised if there's a successful legal challenge. Trouble is the shareholders are likely to be German, French and British banks so the EU wouldn't support that option.
They get the equivalent in shares in the bank so it has not really been taken just exchanged for shares. I am sure we can all see why they would prefer money. however the main problem is
The EU decision to impose a levy on bank deposits may have been motivated by a belief that a lot of the money in Cypriot banks belongs to Russian money-launderers, BBC business editor Robert Peston says
Its 9.9% if you have more than 100,000[£86k] euros and 6.5 below.
I wish i had 86k in the bank tbh and dont know anyone with that much
Consider how we've been robbed, both by increased taxes and cuts to services sand benefits. Apart from the riots of '11what has happened?
I wonder if this isn't the event that though local in its effects, prompts another round of the eurojitters.
Of course the parliament may reject it and the deal will get redrafted, and we'll all go along as before, until we trip over the next obstacle...
Big mistake as this will cause a run on the banks.I can see long queues forming outside the Spanish banks tomorrow of people getting their money out while they can.Spain is in such a mess that neither the government or the banks can be trusted.
The banks are closed tomorrow and they can't take money out on Tuesday as this will be in effect
Spain, Portugal, Greece, Italy...
It's one thing to rob the public to bail out the bankers indirectly, another to be so blatant. Unless this measure is dropped it will reverberate around the zombie economies of the eurozone.
Just imagine how much money will be getting pulled out of banks across Europe over the next 48 hours?
I would imagine that the Swiss and Channel Island bankers will be dancing in the streets tonight!
you get the government you vote for. You vote for a government who promises the easy life large state benefits etc and then you repent at your leisure.
Glad I moved back from Cyprus when I did!
It's problems began like a lot of other countries when it changed over to the euro! Most things went up by quite a lot of cash overnight.
Crikey ... 😯
Be screwed if they did it here and wanted something out of mine! That aside I find it incredible that they can do it. Also can't see it being a good place for a holiday if this kicks off which will make the economy worse again.
They get the equivalent in shares in the bank so it has not really been taken just exchanged for shares
I'm sure lots of Cypriots will be assured by that when they actually want to buy something and there's no money, only a piece of paper that says they have a share in the bank, which will probably be worth about as much as the piece of paper it's printed on.
renton - Member
Glad I moved back from Cyprus when I did!
It's problems began like a lot of other countries when it changed over to the euro! Most things went up by quite a lot of cash overnight.
.
It was down to the interest rate they entered on at the time in which everything nearly
doubled over night.
Cyprus has never been a cheap destination anyway, I remember going there 20 years back
and losing 35p to there pound then, so I imagine it must be near extinct with holiday makers
now.
Having lived in Greece for a Year and witnessed their state benefit, lax taxation and ridiculous pension scams im really not suprised at the mess their economy is in.
Shame its come down to these desparate measures but rest assured those who are pushing these measures will have their money elsewhere ..
I can't see this getting going ahead. It's immoral and bonkers. If it goes ahead there will be runs on the banks in every euro economy that's in trouble.
cheers_drive - Member
I can't see this getting going ahead. It's immoral and bonkers. If it goes ahead there will be runs on the banks in every euro economy that's in trouble.
Have to say It does sound like one of George Osborne screwed up ideas
Sorry lads but youre assuming everyone has the same moral standards and values as your average Brit - unfortunatly i can assure you this isnt the case....
Not wanting to take the moral high ground i knew one bloke who ran a very succesful restaurant business turning over 1 million euros profit who was also a cleaner..... ??
The way it worked was because he had two jobs he only paid income tax on the lowest earning job, so paid a bare minimum on the cleaning income, (never lifted a duster in anger - obviously) and the restaurant income as a wage was untaxed ..
Totally legal and he took great pride in telling anyone whod listen how the the lovely Greek govenment took good care of the workers.
Move on 10 years and you see the results ....
As I understand it, the levies are part of a stipulation made by both the ECB and the IMF as part of the bailout agreement.
This would be the same IMF that told Maggie that we could borrow money from them, but first she had to sell off the national assets and close down the uneconomical state owned industries back in 1979 when she went to them cap in hand because we were broke then. Hence, we now have a very small manufacturing base, council houses were sold for peanuts, our utilities are owned by the French (although that may have more to do with Blair and Brown) etc etc. She did manage to keep North Sea oil and gas though.
The Tories have never been very good at PR.
We're off there on holiday in May 😯
It's problems began like a lot of other countries when it changed over to the euro! Most things went up by quite a lot of cash overnight.
One size does not fit all...
The Tories have never been very good at PR.
Don't you mean they have never been good at Governing
They screwed up in the 80's and just finishing where they couldn't now!
They gave us Pole Tax and now we are to receive Bedroom Tax
all is left is to increase the Interest rate. Tories was brilliant on that !
As I said a few days ago, it is quite probable that Cyprus not Italy will be the catalyst for the next leg of the € crisis. There is no surprise that, like Greece, the restructuring of Cyprus was going to involve a creditor hit. The banking sector had been "allowed" to grow to 7x the size of the economy thanks in part to the Cyprus/Russia link. It was well beyond the point at which creditors could be immune from the obvious restructuring. We cannot keep pretending that that the current crisis can only be solved by debtors taking the hit in Cyprus or in the rest of Europe- that is to fail to learn from economic history.
But, even though it was obvious that there would be a creditor hit in Cyprus, this is a clumsy approach, hiding an effective "haircut" behind the kind of technical jargon that the Euro elite excel on, and effectively killing the principle of deposit insurance in Europe on its head. Once again, the jargon comes in here by imposing a tax rather than losses, but people are not that stupid to fall for it. So once again the rational response is to focus again on sovereign risk - and that is when other S European countries need to be very careful.
The € elite forget at their peril that it will be social unrest not economic problems in isolation that will be the death kneel for their poorly thought out project. But they show no signs of getting this as Cyprus shows only too well.
[edit: slackalice, that is an interesting version of UK economic history there!]
I used to work with a cypriot girl who didnt dare tell her dad how much tax she paid on her salary over here because hed be outraged, I think shed paid more in taxes in the 5 or 6 years shed been here than hed paid in his entire working life (he owned a garage) Im not sure how much he had to bribe the tax inspector, but it was just what everyone did.
this levy is a clumsy way to do things and penalises savers but at least its a bit more upfront than bedroom taxes, fuel duty rises etc etc
if there really are a lot of russian gangsters about to loose their money As a cypriot finance minister id be testing my meals for polonium -210 about now
http://www.ft.com/cms/s/0/3ac3f02a-6962-11e2-b254-00144feab49a.html#axzz2NqBL6Htp
ohnohesback - Member
Of course the parliament may reject it and the deal will get redrafted, and we'll all go along as before, until we trip over the next obstacle...
I dont think this is possible. Cyprus' second biggest bank in in danger of collapse and is surviving thanks to EU emergency measures. These will be pulled and a real liquidity crisis will ensue, if the Cypriots reject the deal (sic). The Cypriot PM tried walking out of the EU meetings this week, but that merely backfired.
Found the speech made yesterday written in English
[url= http://www2.onthisisland.com/live-blog-cypriot-haircut/2013/03/16/ ]Cypriot speech made yesterday[/url]
Blame the €urn as you cannot devalue it unlike if they kept there own currency
so the only option the country has is to bottom more money at an agreed interest rate.
Total Madness
.Dam double post
.
Looks like it can go unto 12.5% now [url= http://rt.com/business/cyprus-bailout-bank-tax-deposits-401/ ]RT.com[/url]
Russia may lose 50 Billion if Cyprus default [url= http://rt.com/business/russia-lose-billions-if-cyprus-default-257/ ]Russian banks[/url]
Most bank accounts in Cyprus are rich Russians trying to avoid paying tax
Firstly, do those harping on about the bedroom tax actually understand it or is it a case of it automatically being bad because the Conservative's have suggested it?
Secondly, I've heard on the grapevine that Cyprus may be a test case, and this €6 billion raid on bank accounts paves the way for Cyprus to leave the Euro.
Thirdly, if that's not the case then is it possible that it's all a ruse to get the Russians to pump some money in to keep the whole mess limping along, the alternative being a few very rich oligarchs losing A LOT of money?
Either way, this has been reported in media outlets across the world I would imagine that confidence in banks will be shattered and there'll be a few squeaky bums in the corridors of power this coming week.
Thirdly, if that's not the case then is it possible that it's all a ruse to get the Russians to pump some money in to keep the whole mess limping along, the alternative being a few very rich oligarchs losing A LOT of money?
This is way too simplistic - it's just a few Russian oligarchs - it's lots of perfectly legitimate Russian companies and investors into Russia who had structured investment via Cyprus to avoid double taxation and have investor protection, and legitimate corporate and middle class account holders who had kept their money in EU domiciled accounts instead of Russian ones to avoid exactly these shenanigans by the Russian government.
This is a terrible idea - you'll not get people saving or trusting banks for decades after this.
I bet whoever thought of this idea is wishing now that they hadn't.
On the contrary, in this case the Germans and the Finns are convinced this is the correct thing to do. We had the brinkmanship over the weekend, but ultimately the Cypriot PM blinked first. Lots of different issues all wrapped here, but no suprise that the proposal ends up as a buggers muddle. 🙁
I bet whoever thought of this idea is wishing now that they hadn't.
Oh I don't know. The politicians that dreampt up, then implemented the whole sorry Euro debacle to begin with, still seem to have their heads firmly in the sand, even as the latest installment of the slow-motion car crash continues.
No... its still a perfectly viable project. Definitely. No problems here at all. Nothing needs changing whatsoever. Its all going just great!
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I wonder if my savings would have gone down more if there was a one off tax on them at 7% or the years of below inflation interests rates that we have.
Our government is doing the same but slower. Inflation reduces the debt burden but is still paid for by savers.
Not just the savers...
Apologies for the tangent but:
The Flying Ox - Member
Firstly, do those harping on about the bedroom tax actually understand it or is it a case of it automatically being bad because the Conservative's have suggested it?
No, it's because it's a stupid idea. If there were enough smaller homes for people to downsize then we could discuss it. But there aren't, by a long way. It will penalise people for having empty rooms when there is no-where smaller for them to move.
Our government is doing the same but slower. Inflation reduces the debt burden but is still paid for by savers.
Yes but you have the choice to move your money!, this is just theft.
I have cypriot bank accounts (not much in them luckily) but can you imagine if you had just completed a house sale for example!
Our online access between cyprus accounts has now been disabled so I cant pay my bills anyway.... that helps the economy no end
Looks like they may reduce the lower theft to 3%
http://www.telegraph.co.uk/finance/debt-crisis-live/9936737/Cyprus-bailout-live.html
Even so, now that the principle has been established, who in a shaky eurozone economy will trust the banks again? They really don't realise what they've done...
Yes but you have the choice to move your money!, this is just theft.
If my bank went bust I'd be quite relieved to get to keep 90% of my money.
Even so, now that the principle has been established, who in a shaky eurozone economy will trust the banks again? They really don't realise what they've done...
Yup agreed, who wants to save now!
But wouldn't you rather have the original amount protected by the original deposit protection scheme?
Apparently Russian energy giant Gazprom has offered Cyprus an alternative to the Troika bailout in exchange for exploration rights for natural gas in the island, according to reports in the Greek media.
But wouldn't you rather have the original amount protected by the original deposit protection scheme?
It's not just the bank going bust it's the country, so assuming there was one who is going to honour it?
Cyprus has gas?
Its quite a quaint idea to refer to the deposits made by Vladimir Putins friends as 'savings'. Bless 'em. They've been putting a little bit of their hard-earned wages to one side, every week. Maybe doing without life's little luxuries, so as to save for a rainy day? 😆
Looks like the Cypriot government have cancelled the bail-out vote this afternoon, and the banks are to remain closed.
No doubt as the result of the large men, with conspicuous bulges in their jackets, who just arrived on the flight from Moscow to 'have a word'
cypriot mate reckons its punishment from the EU for laundering russian money, allegedly more than 50% of banks money is russian
Cyprus has gas?
yes its offshore only snag is their close friends the Turks say its theirs......
This is a joke.
The euro needs to go....idealistic nonsense with no basis in sound financial reality.
Banks should've been allowed to fail a few years back....short term pain for a much more healthy long term banking sector.
The term 'too big to fail' and government handouts have given those in finance carte blanche to carry on as though the crisis never happened.
Raiding saving accounts is a low move, with the revenue the EU takes each year it is scandalous that they have to do this....but then the EU's finances are a joke so i shouldnt be surprised.
They could have started something terrible here...imagine if people move the bulk of their wealth out of EU banks?
and the banks are to remain closed.
Oh great well that'll help the people who need to buy things to live then Jeez
xcgb - Member"Cyprus has gas?"
yes its offshore only snag is their close friends the Turks say its theirs......
What could possibly go wrong?
Looks as if the vote has been put back until Tuesday.
What could possibly go wrong?
Alex Salmond claiming they're both wrong, and its all his? 😀
It's quite interesting- someone pointed out that the foundation of modern banking was partly based on the desire to keep your money out of government's hands... Charles 1st's raid on the private bullion in the Tower spurred investors to keep their money elsewhere, first in goldsmiths which then evolved into banks. I wonder where this might lead us now... Even if they pull back from it now the fact that it was ever on the table will get people thinking.
5thElefant - MemberIf my bank went bust I'd be quite relieved to get to keep 90% of my money.
And if someone else's bank went bust?
I'd be amazed if we don't see bank runs across other parts of the Eurozone as a result of this. I can't see them stopping, but even if they did just that fact they've considered it would have me running for the exits if I had money in Cyprus, Greece, Italy, Spain, Portugal.......
Still, at least they're being open in their theft rather than Merv and Osborne printing to oblivion and killing us all with inflation.
Today is a public holiday in Cyprus so presumably the banks would have been closed anyway.
Wow id Binners and THM are saying the EU is in trouble and criticising the EUro then it must serious 😛
TBH a bunck of tax avoiders [ its a tax haven] and a bunch of russians moneyy launderers are out of pocket - why are you all so concerned about this - we are still talking about folk with £88K savings
Why help these?
Aprt of capitalism is the reward for risk and part of it is th eprice of failure.
You all moaned when we paid to bale them out now we all moan when we dont do it fully and ask them to help [ granted it should also involve the shareholders]
Bit like cars we want green taxes we dont want to pay more for our fule and we want quieter roads but we dont want to be the ones not driving
Its no wonder the politicians are idiots ; their masters are
Even if this theft is cancelled there is now the ongoing question, when or where next will this stunt be tried? And how many times if multiple bailouts are 'needed'?
It's the typical EU shooting themselves in the foot and undoing all their efforts thus far.
I wonder if my savings would have gone down more if there was a one off tax on them at 7% or the years of below inflation interests rates that we have.Our government is doing the same but slower. Inflation reduces the debt burden but is still paid for by savers.
+1
[i]This is way too simplistic - it's just a few Russian oligarchs - it's lots of perfectly legitimate Russian companies and investors into Russia who had structured investment via Cyprus to avoid double taxation and have investor protection, and legitimate corporate and middle class account holders who had kept their money in EU domiciled accounts instead of Russian ones to avoid exactly these shenanigans by the Russian government.[/i]
Please tell me this is sarcasm?
Today is a public holiday in Cyprus so presumably the banks would have been closed anyway.
Yes which explains the timing, but they are talking about closing them until friday
Wow id Binners and THM are saying the EU is in trouble and criticising the EUro then it must serious
Yip. Sometimes its hard just being the lone voice trying to speak out against the widely held consensus that its all going just great!! 🙄
You don't think that this crisis in Cyprus is going to have any kind of domino-effect throughout Southern Europe then? No.... of course not.... according to the Euro enthusiasts in Brussels, the whole Euro crisis was done and dusted and taken care of last year, wasn't it? I think there was you, and 3 other people who believed that
You should try being the forum doommonger Binners!
It's a dirty job but someone has to do it.
C''mon JY play the ball not the men - no room for ad Homs in the STW inn (lovely mixed metaphors). I know defending the indefensible is hard (that's why I love it) but lets stick to the facts in front of us. 😉 Not only is this more European nonsense, they compound it yet again by trying to hide fact behind technical jargonise. Remind us/me, these people are working for, or representing who, exactly?
JY - are you not getting that feeling of Deja vu? The technocrats in Brussels pouring billion after billion of other peoples money into a huge black hole, so they can kick the can down the road for another month or two? Before the next crisis? The one that looks remarkably like the last one... and the one before that... and the one before that... and the one before that... and the one before that... and the one before that...
All so that none of them have to face up to the uncomfortable reality that the currency/political project they created is, and always was, completely unworkable
Binners not doing this again just take it as joke or dont but really is rather like deabting this with farage tbh 😉
Wow neither of you mentioned the IMF just the Euro - who would have thunk that etc
Its is pointless to debate the Euro with you two - it is irrelavent what is happening you will say it is doomed to failure- of course currently its not good but where it tbh.
All is say is if they are willing to back it enough and pay the political and economic cost it will survive. Whether they will and whether that is good or bad is another issue
Oh yes.... I forgot... Anyone who thinks the Euro is/was a ridiculous idea from the beginning is a little Englaner/closet racist/Mail Reader/whatever.....
But each time the can is kicked it becomes heavier, travels less far, and does more damage to the foot that kicks it.
They gave us Pole Tax and now we are to receive Bedroom Tax
What's a Pole Tax (other than something UKIP would like to introduce)?
They gave us Pole Tax and now we are to receive Bedroom TaxWhat's a Pole Tax (other than something UKIP would like to introduce)?
Ask Peter Stringfellow, it nearly put him out of business.
I forgot... Anyone who thinks the Euro is/was a ridiculous idea from the beginning is a little Englaner/closet racist/Mail Reader/whatever.....
Prety sure we can all feel the love and high regard you and THM have for the Euro project 😕
Leaves thread to the closets racists and loons [ CMD quote - i know neither of you are this at all]
Let's keep to the subject on Cyprus and its wider implications for the euro.
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😉
Anyone who thinks the Euro is/was a ridiculous idea from the beginning is a little Englaner/closet racist/Mail Reader/whatever.....
That's because it's not a ridiculous idea, and if they'd stuck to France/Germany/Benelux it would be much more viable than it is now. What's causing problems is the bending of the rules for political gain to admit countries (eg. Greece) who should never have been allowed to enter monetary union. The undervaluing of the Deutschmark when exchange rates were fixed in the run in to the Euro doesn't help, of course.
Andy
http://rt.com/business/cyprus-deposit-tax-markets-427/
The rate on troubled eurozone nations' bonds is rising. More pain and more problems to come...
...while German two year yields go back (briefly) below 0%. It's an odd day when UK gilts are considered a safe haven too!