Video - Cyprus vs Bankocracy: 'Mattress better place to keep cash than banks'

'Without big banks, socialism would be impossible.' – Vladimir Lenin

Germany warns Cyprus its banks may NEVER reopen as Russia 'offers to write off debt if Gazprom get access to untapped oil fields'.

Germany warns Cyprus its banks may NEVER reopen as Russia 'offers to write off debt if Gazprom get access to untapped oil fields'.(DM).Germany's warning came after Cyprus's parliament overwhelmingly rejected a proposed levy on bank deposits as a condition for a European bailout of 10 billion euros (£8.6bn) last night.

German Chancellor Angela Merkel said it was up to the Cypriot government to come up with an alternative proposal but it was fair to expect savers with deposits over 100,000 euros (£86,000) to contribute to the bailout.

Moscow is now a massive ally for Cyprus - Cypriot Finance Minister Michael Sarris said he had not reached a deal at a first meeting today with his Russian counterpart Anton Siluanov, but talks there would continue.

... Russia's finance ministry said Nicosia had sought a further 5 billion euros, on top of a five-year extension and lower interest on an existing 2.5 billion euro loan.

Moscow was angered that the European Union did not consult it over the proposed levy.

President Vladimir Putin called the decision to seize money from savers’ bank accounts as ‘unfair, unprofessional and dangerous’.

Representatives of the Russian energy giant submitted the proposal to the office of Cypriot President Nicos Anastasiades on Sunday evening.

Even the Church of Cyprus offered to help. 'The entire wealth of the Church is at the disposal of the country ... so that we can stand on our own two feet and not on those of foreigners,' Archbishop Chrysostomos said after meeting Anastasiades early today. The Church of Cyprus is a major shareholder in Cyprus's third-largest domestic lender, Hellenic Bank.

It is also rumoured that the Kremlin is privately offering to help bail out Cyprus in exchange for the right to use a naval base in the Greek part of the island.Hmmmm.......Would be very welcome now that Tartus is 'sinking'.Read the full story here.


Update: Cyprus Fails to Obtain Kremlin Aid.(MT).

Sarris did not manage to negotiate a Russian bailout despite a 1 1/2 hour meeting with his counterpart, Anton Siluanov.

"We had a very good first meeting, very constructive, very honest discussion," he told journalists afterward, Bloomberg reported.

Sarris subsequently attended a second meeting with Deputy Prime Minister Igor Shuvalov, Siluanov and Deputy Finance Minister Sergei Storchak. An undisclosed source told Russian newswires that negotiations had not yielded any results and would continue Thursday.

European Commission President Jose Manuel Barroso is due to visit Moscow on Thursday for scheduled talks.

"We understand how difficult the situation is, and we'll continue negotiations to find the solutions that will help us obtain Russia's support," Sarris said, adding that the Cypriot delegation would remain in Moscow "until we reach any agreement." Read the full story here.

Video - Nigel Farage Message To Europeans: “Get Your Money Out While You Can”

In Nigel Farage’s first TV appearance since the Cypriot wealth tax was announced, the Englishman pulls no punches. In all his years and all his experience of the desperation of the European Union’s leadership “never did [he] think they would resort to stealing money from people’s savings accounts.”

The simple fact is that they know they cannot let any country leave, no matter how small, for “once one country goes, the whole deck of cards will come tumbling down.” There is now “clear irreconcilable differences” between the North and the South of Europe and now that they have done this in one country, “they are quite capable of doing it in Italy, Spain and anywhere.”

The message that sends to people is ”get your money out while you can.” As far as his British constituents, he strongly recommends George Osborne (UK Chancellor) urge ex-pats to remove all their money and do monthly transfers from home. “Do Not Invest In The Euro-Zone,” he concludes,“you have to be mad to do so– as it is now run by people who do not respect democracy, the rule of law, or the basic principles upon which Western civilization is based.”

“They are propping up a Eurozone that, in the end, will collapse in disastrous failure and they are prepared to do anything to do so.”

"The Great Bank Robbery" - Cyprus Considers Zero Tax on Smaller Bank Deposits; All Banks Remain Closed.

"The Great Bank Robbery" - Cyprus Considers Zero Tax on Smaller Bank Deposits; All Banks Remain Closed.(BBC).

The Cyprus finance ministry suggests savers holding less than 20,000 euros (£17,000) would be exempt from a bank levy which has caused much alarm.

Amounts between 20,000 and 100,000 euros would face a 6.75% tax. The levy on savings above 100,000 would remain at 9.9%. The levy has enraged Cypriots.

The earlier plan was to tax all savings under 100,000 euros at 6.75%.

…

Fearing a run on accounts, Cyprus has shut its banks until at least Thursday. The local stock exchange also remains closed.

Cyprus’ banks were badly exposed to Greece, which has itself been the recipient of two huge bailouts.

On Monday there were jitters on global markets over Cyprus, amid shock that for the first time in the eurozone crisis ordinary savers would suffer a “haircut” on their bank accounts – a slice of their savings.

Hmmmm.......Now there are 'rumors' of a 15% 'tax'on savings over 500,000 euros.Read the full story here.

"The Great Euro Robbery" - France, Germany insist savings levy was Cyprus's decision.

"The Great Euro Robbery" - France, Germany insist savings levy was Cyprus's decision.(RT).Both France and Germany, along with the European Central Bank(ECB), have hastened to emphasize that they were not behind the decision to impose a tax on savings in Cyprus. A move which has impacted the markets worldwide.

A debate in the Cypriot parliament Monday yielded no result on whether the country should approve the controversial levy.Opposition parties are against the move, leaving the government without a majority in the upcoming vote, which has been delayed until Tuesday.

The new tax, which is now being considered by the Cypriot government, would make its citizens shoulder a 12.5-percent crisis tax on savings larger than €100,000, with a tax of 3 percent on smaller deposits.

The original agreement suggested 9.9 and 6.7 per cent levies on deposits above and below the €100,000 threshold respectively.

The move comes after European finance ministers demanded Cyprus seize a significant portion of all deposits in the country’s banks in order to secure a €10 billion bailout.

And while Cyprus says Brussels gave it no choice but to accept a painful tax on the country’s bank deposits in return for international aid, Germany and France say it’s not their fault.

"How the country makes its contribution, how it makes the payments, is up to the Cyprus government," Germany’s government spokesman Steffen Seibert said. "Germany could have imagined a different plan but it is not our decision," he added. 
Protesters in Cyprus, who gathered outside the Parliament building in the capital Nicosia, to express their outrage over the bailout, have held up banners blaming Germany for the controversial bailout deal. “Merkel, you stole our life savings,” read one of the banners. The other – “Europe is for its people, not for Germany”.

The ECB from its side argued that the initiative was “the Cyprus government's adjustment programme, not the Troika's or any other government's,"

"If Cyprus's president wants to change something in the structure of the levy on bank deposits, that's in his hands. He must simply make sure that the financing is intact," ECB executive board member Joerg Asmussen said.

France backed Cyprus' “different distribution to better protect small deposits,” saying that its choice “respects the total amount of its contribution to the program, we have to listen to it and, for me, to hear it," France’s Finance Minister Pierre Moscovici told AFP.

The ECB opened the door to possible amendments to the EU bailout deal, arguing that as long as the financing was secure, it was up to the Cypriot government to decide how to raise it.

The Russian Prime Minister Dmitry Medvedev gave a harsh comment. “This looks like a forfeiture of other people’s money,” he told the RIA news agency, calling the decision strange and controversial. Russian banks had around $12 billion deposited in Cypriot banks at the end of 2012, according to ratings agency Moody's.Read the full story here.

IMF: "Eurozone has to 'act', or else banks will topple, and the monetary union will not be sustainable."

IMF: "Eurozone has to 'act', or else banks will topple, and the monetary union will not be sustainable."(TestosteronePit).By Wolf Richter.

Why is it that 17 nations have to fundamentally reorganize themselves and shift sovereignty away from national parliaments to new layers of transnational, beyond-control bureaucracies that can extract untold wealth from taxpayers—just to save the banks?

That’s what the Eurozone has to do, or else banks will topple, and the monetary union will not be sustainable, according to the “first ever European Union-wide assessment of the soundness and stability of the financial sector,” released Friday by the institution that the world couldn’t do without, the IMF.
“Financial stability has not been assured,” the report stated flatly about the fiasco in the Eurozone, despite ceaseless hope-mongering by Eurocrats and politicians, and banks remain “vulnerable to shocks.” The report, which never mentioned banks or countries by name, discussed a number of “risks” that could topple these banks, with some of these “risks” already having transitioned to reality:
“Declining growth.” Banks with “excessive leverage, risky business models, and an adverse feedback loop with sovereigns and the real economy” are particularly vulnerable. Hence, most banks. A number of European countries have been in a deep recession, some of them for years. So “declining growth” is a reality, and these “shocks” are happening now, said the IMF in its more or less subtle ways.
“Further drop in asset prices.” Real estate prices are now dropping in some countries that didn’t see a collapse during the first wave, including France and the Netherlands—where it already took down SNS Reaal, the country’s fourth largest bank [A Taxpayer Revolt Against Bank Bailouts In the Eurozone]. So hurry up and do something, the IMF said.
The report points at other risks for banks. Pressures in wholesale funding markets could dry up liquidity and tighten refinancing conditions. And the market could lose confidence in the sovereign debt that banks hold. For example, an Italian bank, loaded with Italian government debt, would topple if that debt lost value—but of course, the report refuses to name names.
And in “several countries,” the heavy concentration of megabanks “creates too-big-to-fail problems that could amplify the country’s vulnerability.”
So Germany, France, and the UK. Alas, in Europe too-big-to-fail doesn’t necessarily mean big. In tiny Cyprus, fifth country to get a bailout, the banks, though minuscule by megabank standards, are getting bailed out anyway. 
It’s psychological. A fear. If even a small bank were allowed to go bankrupt, the confidence in all banks across the Eurozone would collapse. That’s how fragile Eurocrats and politicians fear their banks have become—despite their reassurances to the contrary.
And so “policymakers and banks need to intensify their efforts across a wide range of areas” to save these banks, the IMF exhorts these Eurocrats and politicians.
Big priorities: “bank balance sheet repair”; banks should build larger capital buffers to be able to absorb shocks. And “credibility” repair of these balance sheets. In an admission that bank balance sheets still aren’t worth the paper they’re printed on, the IMF calls for stiffening the disclosure requirements, “especially of impaired assets” that are decomposing in hidden-from view basements.
The new Single Supervisory Mechanism (SSM), the EU-wide banking regulator under the ECB, to be operational by early 2014, would have to have real teeth, along with expertise, the IMF pointed out. It should regulate all banks in the Eurozone “to sustain the currency union” and in the entire EU to sustain “the single market for financial services.” 

In other words, without the SSM, the currency union won’t make it.

But the IMF’s killer app is the Banking Union, a “single framework for crisis management, deposit insurance, supervision, and resolution, with a common backstop for the banking system.” Under this system, taxpayers in all Eurozone countries would automatically be responsible for bailing out banks, their investors, bondholders, counterparties, and account holders in any Eurozone country.

For the most hopeless cases, the Single Resolution Mechanism would step in to dissolve banks “without disrupting financial stability”—hence bail out investors, disrupting financial stability being a term that’s commonly used to justify anything. The medium would be the transnational taxpayer-funded ESM bailout fund; it would bail out banks directly, rather than bail out countries after they bail out their own banks—which is the rule today.

In the process, countries would surrender much of their authority over banks—and how or even whether to bail them out—to this new instrument. Decision makers would be Eurocrats, far removed from any popular vote. 
Victims would be the people who’d end up paying for it. Investors and speculators would profit. Other beneficiaries would be politicians who’d no longer have to bamboozle voters into bailing out banks because it would be done by a distant power.
The dictum that there is never an alternative to bailouts would be cemented into the system. Democracy, which always gets trampled during bailouts, would be essentially abolished when it comes to transferring money from citizens to bank investors. And that’s of course the ultimate goal of the banking industry.
The stark reality facing millions of Spaniards, Italians, Greeks, and Portuguese is hidden—buried deep under a mountain of economic data, massaged to suit the purposes of the central planners-in-chief. But this is the story of a dying breed: self-made entrepreneurs and small business owners here in Spain, by Don Quijones. Read.... The Reality Of Doing Business In Spain: A Personal Account.

Hmmm.....Strange i was wondering a couple of hours ago if Europe would repeat their Cyprus stunt on the Easter long weekend......but yes why wouldn't the US?

Saxo Bank CEO: "This Is Full-Blown Socialism And I Still Can't Believe It Happened"

Saxo Bank CEO: "This Is Full-Blown Socialism And I Still Can't Believe It Happened".(ZeroHedge).Authored by Lars Seier Christensen, CEO Saxo Bank; originally posted at his blog at TradingFloor.com,

It is difficult to describe the weekend bailout package to Cyprus in any other way. The confiscation of 6.75 percent of small depositors' money and 9.9 percent of big depositors' funds is without precedence that I can think of in a supposedly civilised and democratic society. But maybe the European Union (EU) is no longer a civilised democracy?

I heard rumours about this when I visited Limassol last week, but dismissed them as completely outlandish. And yet, here we are. The consequences are unpredictable, but we are clearly looking at a significant paradigm shift.

This is a breach of fundamental property rights, dictated to a small country by foreign powers and it must make every bank depositor in Europe shiver. Although the representatives at the bailout press conference tried to present this as a one-off, they were not willing to rule out similar measures elsewhere - not that it would have mattered much as the trust is gone anyway. It is now difficult to expect any kind of limitation to what measures the Troika and EU might take when the crisis really starts to bite.

If you can do this once, you can do it again. if you can confiscate 10 percent of a bank customer's money, you can confiscate 25, 50 or even 100 percent. I now believe we will see worse as the panic increases, with politicians desperately trying to keep the EUR alive.

Depositors in other prospective bailout countries must be running scared - is it safe to keep money in an Italian, Spanish or Greek bank any more? I dont know, must be the answer. Is it prudent to take the risk? You decide. I fear this will lead to massive capital outflows from weak Eurozone countries, just about the last thing they need right now. Even from the EU as a whole, I suspect, as the banking union is in place in most countries already.

Another open question is what will happen to the huge number of brokerages based in Cyprus? There is about 100 or more FX and other brokers currently operating under the relatively light Cypriot regulation. How will this impact the trustworthiness of these many small institutions? What IS the exact impact on the client deposits they might be holding in Cyprus? Will anyone dare to do business with them going forward?

This is a major, MAJOR game changer and the fallout will be with us for a long time to come. I believe it could be the beginning of the end for the Eurozone as this is an unbelievable blow to the already challenged trust that might be left among investors. Talk about a possible own goal.

Market reaction? it must be very good for gold - and for safe-haven countries like Switzerland, Singapore and economically more healthy non-Euro countries in, for example, Scandinavia. I would think the EUR and associated markets will be undermined by increasing lack of confidence when the full implications become clear for investors.

This is full-blown socialism and I still cannot believe this really happened.Hmmmm.......They just crossed the Rubicon and all bets are off.Read the full story here.