CRUMMY GOVERNMENTS DOING BANKSTERS WORK FOR THEM!

March 19, 2013

CYPRUS PARLIAMENT NIXES TAXES ON SAVINGS

BUT RAISING BAILOUT $$$’s STILL ON TABLE!

http://www.guardian.co.uk/world/2013/mar/19/cyprus-parliament-rejects-savings-levy

Cyprus parliament overwhelmingly rejects bailout savings tax

Plan for a levy on accounts had sparked outrage among Cypriots and unsettled financial markets, where euro continues slide

Cyprus protesters

Cypriot protesters take part in an anti-bailout rally outside the parliament in Nicosia. The banner reads ‘Cyprus says no’. Photograph: Yorgos Karahalis/Reuters

The Cypriot parliament rejected a planned levy on bank deposits on Tuesday, throwing a European bailout plan for the tiny economy into disarray.

The vote was overwhelming, 36 with against and 19 abstentions, and brings Cyprus to the brink of financial collapse.

Shortly after the vote, the euro fell 0.8 of a cent to $1.2874, its lowest level for three months. The euro has been on the slide since it became clear that even the government’s own party would not stand behind the deal.

News that MPs had resoundingly rejected the bailout was greeted with applause and cries of “bravo” from the crowds outside the Cyprus parliament, according to those at the scene.

MPs in the main government party abstained, and most of the other members of the tiny legislature else voted against. There were no votes in favour of the deal.

Cyprus’s banks were due to open again on Thursday, but there is already speculation that the current bank holiday could be extended. Next Monday is also a scheduled bank holiday, so the prospect of a longer period of disruption is possible.

EU countries said before the vote that they would withhold €10bn in bailout loans unless depositors in Cyprus shared the cost of the rescue, and the European Central Bank has threatened to end emergency lending assistance for teetering Cypriot banks.

After the vote, the ECB said it remained committed to providing liquidity to Cyprus’s banks “within the existing rules”.

“The ECB takes note of the decision of the Cypriot parliament and is in contact with its troika partners. The ECB reaffirms its commitment to provide liquidity as needed within the existing rules.”

There were fears that the ECB could pull the plug on the country’s two biggest banks, by terminating the support provided under its Emergency Liquidity Assistance – on the grounds that they could be insolvent. But Cyprus could be gambling that the ECB would not risk turning off the tap.

Sebastien Galy, senior currency strategist at Société Générale, said that Cyprus’s government will eventually manage to hammer out a new deal, but not before a great deal more uncertainty.

He said: “Superficially it is negative, more practically it means we are off to the next round of negotiations which means more uncertainty and eventually some form of deal. Drama is sadly a part of the negotiation process.”

Fears over the eurozone crisis will keep pushing the euro down against the US dollar, he added.

Newly elected president Nicos Anastasiades earlier told reporters he expected parliament to reject the tax on bank deposits, “because they feel and they think that it is unjust and it’s against the interests of Cyprus at large.”

Europe’s demand at the weekend that Cyprus break with previous EU practice and impose a levy on bank accounts sparked outrage among Cypriots and unsettled financial markets.

Anastasiades refused to accept a levy of more than 10% on deposits above €100,000, which meant taxing smaller accounts too. That would have hurt ordinary savers with deposits that they thought came with a state guarantee.

Cypriot finance minister Michael Sarris flew to Moscow on Tuesday to seek Russian financial assistance. He denied by text message reports that he had resigned, which rattled nerves as lawmakers were poised to vote.

Stunned by the backlash, eurozone finance ministers urged Nicosia on Monday to avoid hitting accounts below €100,000, and instead increase the levy on big accounts, which are unprotected by the state deposit guarantee.

The European Union and International Monetary Fund are demanding Cyprus raise €5.8bn from depositors to secure its bailout, needed to rescue its financial sector.

A revised draft bill would have exempt savings under €20,000 from the planned 6.75 percent levy on deposits of less than €100,000, leaving a shortfall, but that was not enough to sway lawmakers, even in the ruling party, to accept the tax.

The French finance minister, Pierre Moscovici, said the eurozone could not lend Cyprus any more, since the country’s debt would become unmanageable. “Above €10bn we are entering into a size of debt that is not sustainable,” Moscovici told reporters in Paris.

An influx of Russian money and influence since the collapse of the Soviet Union has led some Brussels officials to complain privately that Cyprus acts at times as a “Trojan donkey” for Moscow inside the European Union since it joined in 2004.

Stunned Cypriots emptied cash machines over the weekend and banks are to remain shut on Tuesday and Wednesday to avoid a bank run. The island’s stock exchange also suspended trading for another two days.

THE WORLD WIDE BUBBLE IS READY TO BURST!

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NOW NEW ZEALAND GOVERNMENT IS EYEING SAVINGS ACCOUNTS!

http://www.scoop.co.nz/stories/PA1303/S00306/national-planning-cyprus-style-solution-for-new-zealand.htm#.UUiQ0V3bBo8.facebook

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National planning Cyprus-style solution for New ZealandTuesday, 19 March 2013, 11:32 amPress Release: Green Party

19 March 2013

National planning Cyprus-style solution for New Zealand


The National Government are pushing a Cyprus-style solution to bank failure in New Zealand which will see small depositors lose some of their savings to fund big bank bailouts, the Green Party said today.

Open Bank Resolution (OBR) is Finance Minister Bill English’s favoured option dealing with a major bank failure. If a bank fails under OBR, all depositors will have their savings reduced overnight to fund the bank’s bail out.

“Bill English is proposing a Cyprus-style solution for managing bank failure here in New Zealand – a solution that will see small depositors lose some of their savings to fund big bank bailouts,” said Green Party Co-leader Dr Russel Norman.

“The Reserve Bank is in the final stages of implementing a system of managing bank failure called Open Bank Resolution. The scheme will put all bank depositors on the hook for bailing out their bank.

“Depositors will overnight have their savings shaved by the amount needed to keep the bank afloat.

“While the details are still to be finalised, nearly all depositors will see their savings reduced by the same proportions.

“Bill English is wrong to assume everyday people are able to judge the soundness of their bank. Not even sophisticated investors like Merrill Lynch saw the global financial crisis coming.

“If he insists on pushing through this unfair scheme, small depositors can be protected ahead of time with a notified savings threshold below which their savings will be safe from any interference.”

Dr Norman questioned the Government’s insistence on pursuing Open Bank Resolution when virtually no other OECD country uses it.

“Open Bank Resolution is unprecedented in the world. Most OECD countries run deposit insurance schemes which protect people’s deposits up to a maximum ranging from $100,000 – $250,000,” Dr Norman said.

“OBR is not in line with Australia, which protects bank deposits up to $250,000.

“A deposit insurance scheme is a much simpler, well-tested alternative to Open Bank Resolution. It rewards safe banks with lower premiums and limits the cost to taxpayers of a bank failure.

“Deposit insurance will, however, require the Reserve Bank to oversee and regulate our banks more closely – a measure which is ultimately the best protection against bank failure.”

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MARCH 18, 2013

THE FINANCIAL MELTDOWN MAY BE ALREADY HAPPENING!

The saga of governments stealing their citizens money continues with the next column discussing the possibility of this type of event happening in America!

http://www.wnd.com/2013/03/could-cyprus-bank-runs-happen-here/

WND

COULD CYPRUS BANK RUNS HAPPEN HERE?

Proposal would take money right out of depositors’ accounts

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By Garth Kant

With the Mediterranean island nation of Cyprus about to impose a confiscatory tax – up to 9.9 percent – on all bank accounts, resulting in a run on Cypriot banks, the rest of the world is watching anxiously and asking the obvious question: “Could it happen here?”

The economy of Cyprus is the third-smallest in the Eurozone, and its government is heavily in debt. Over the weekend, a group of European finance ministers came up with a $13 billion emergency assistance package to bail out banks in Cyprus, with one very big catch.

The government of Cyprus would have to raise $7.5 billion through a tax on Cypriot bank depositors.

Under the most recent terms discussed, depositors with more than 100,000 euros, or about $130,000, would get 9.9 percent immediately deducted from their accounts. Smaller deposits would suffer a deduction of 6.75 percent.

It’s being called a “onetime” deduction, or tax.

Even though some economists say Cyprus is a special case and the “contagion” of taxing bank accounts is unlikely to spread, until now bank accounts worldwide, no matter how dire the government’s financial woes, have been held sacrosanct.

Now the government in at least one nation is poised to simply take money out of depositors’ accounts. That’s a first.

Could it happen in the U.S.?

Some experts say probably not – at least not in the same way as in Cyprus.

Economist, speaker and author Jerry Robinson, who runs Follow the Money Daily and is a featured columnist at WND, assessed the crisis in Cyprus.

“It has a lot to do with politics, Angela Merkel’s reelection bid and also a few others trying to stay in power,” he said.

Robinson said it’s interesting to observe that such powers are playing tough with a tiny nation like Cyprus, while bigger nations with worse economies, such as Italy and Spain, have not been attacked in the same way.

But he said the plans are drastic.

“This is nuclear war on the banking [industry],” he said.

Robinson said while the “tax” has yet to occur, he’s concerned by such actions.

Some analysts point out that in the U.S., government is already “taxing” Americans’ bank accounts by other, less obvious and more long-term means than the naked cash-grab playing out in Cyprus.

For instance, interest rates in the U.S. are near zero, so depositors aren’t getting paid for the use of their funds, effectively “loaning” their hard-earned money to banks. Then, thanks to inflation, their deposits become worth progressively less and less.

The real-world inflation rate – as measured by the actual rise in prices of essentials, including food and fuel – is far higher in the U.S. than the official 2 percent. But even using the 2 percent figure, over the next few years the buying power of American depositors’ bank accounts will be just as diminished as that of Cyprus bank-account holders.

But this new and unsettling form of “tax” isn’t the only concern. The immediate concern for many is that the crisis in Cyprus will spread, causing bank runs in other troubled European Union countries such as Greece, Italy, Spain and Portugal. A European financial crisis of that magnitude would undoubtedly hurt the U.S. economy.

Most American depositors take comfort in the fact that their savings accounts in banks and credit unions are federally guaranteed up $250,000. However, those government funds are designed to bail out very infrequent bank failures. They in no way could cover all depositors’ accounts in the case of a widespread run on U.S. banks, as is occurring now in Cyprus.

Respected hard-money proponent James Turk says bank runs in Europe are a wake-up call to all bank depositors around the world.

“Bank insurance means nothing these days when bureaucrats and politicians are looking for wealth to grab,” Turk said.

“To me this proposed bailout is outright theft, and theft cannot be justified, but the central planners are trying to do that anyway,” he added.

“The events in Cyprus are obviously a scary message that the Greeks, Spaniards, Italians and others are taking seriously, because they see that their money in the bank is at risk, too. But the less obvious message is that all money in banks is at risk. Not only are bank assets impaired, but all the banks are interlinked because they lend to one another and own a lot of debt of insolvent countries,” concluded Turk.

Not surprisingly, bank shares tumbled in Europe today. The latest shock comes as European banks are still struggling to recoup losses from the financial crisis.

Cyprus is particularly vulnerable to instability in the banking sector. The country’s banking assets are about eight times the size of the economy. And foreign investors hold almost half of the 70 billion Euros deposited in Cyprus. Moody’s estimates $19 billion of those deposits are owned by Russian corporations. Many suspect the Russian mafia uses banks in Cyprus to launder money.

Russian officials had been considering reducing the interest and extending the maturity of a 2.5 billion Euro loan to Cyprus. Now, the Russians say they are reconsidering because the EU did not include them in bailout talks.

The European finance ministers are also reconsidering. The Eurogroup, as they are known, held an emergency meeting today to try to calm fears over the Cyprus crisis.

The Eurogroup now recommends that depositors with less than 100,000 euros be protected.

The finance ministers also have decided to give Cyprus more flexibility over the bank tax, but the country would still need to raise 5.8 billion euros from the tax.

A vote on the plan by the Cyprus parliament has been delayed until tomorrow.

The U.S. Treasury Department issued a statement: “The Treasury Department is monitoring the situation in Cyprus closely, and Secretary Jacob Lew has been speaking with his European counterparts. It is important that Cyprus and its euro-area partners work to resolve the situation in a way that is responsible and fair and ensures financial stability.”

But the damage may be already done to confidence in the European banking system. This is the first time a national bailout has proposed to impose losses on bank depositors. Some call that a dangerous precedent.

Read more at http://www.wnd.com/2013/03/could-cyprus-bank-runs-happen-here/#DhMi4gcgd7DbVdvQ.99

The following piece details how the Australian government has given itself the right to plunder its own peoples savings accounts! Can Cyprus like actions be far behind?

SEIZING MONEY FROM BANK ACCOUNTS!

http://wakeup-world.com/2013/03/15/australian-government-set-to-seize-money-from-citizens-bank-accounts/

Australian Government Set to Seize Money from Citizens Bank Accounts

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15th March 2013

By Michael Smith

Guest Writer for Wake Up World.

The ‘Australian Government’ is now set to ‘legally’ seize money from citizens bank accounts without their knowledge or approval.

After legislation was rushed through parliament, the government will from May 31 be able to transfer all money from accounts that have not been used for three years into their own revenues.

Legislation amended late last year means any account that has not seen activity within three years can be transferred into the Commonwealth’s hands – previously the rule was seven years.

This will mean that accounts with anything from $1 upwards that have not had any deposit or withdrawals in the past three years will be transferred to the Australian Securities and Investment Commission and thus hundreds of millions of dollars in inactive bank deposits are likely to flow to the Federal Government from May.

The money can be reclaimed from ASIC but the process can take months.

As the new law comes into effect at the end of May 2013 banks are advising customers to make transactions as small as a dollar to ensure they are not transferred to ASIC.

Experts warn this will have a negative impact on people that may have put money away in a special account for their children’s education or decided to put an inheritance in a separate account for a rainy day.

The banking industry believes the Government’s changes to inactive bank accounts legislation is just revenue raising.

Mr Munchenburg says the legislation was rushed through at the end of last year.

“A lot of suspicion at the time that the Government is rushing this through because they were more concerned about their own financial bottom line than they were about reuniting consumers with their accounts,” he said.

“It was never clear to us why it had to be rushed through if it was only focused on reuniting consumers with accounts.”

Mr Munchenburg says three years seems an arbitrary time limit as the Government failed to consult the industry on the change.

“I don’t know why three years has been chosen over seven,” he said.

“Certainly, if the Government believed that seven years was too long, we would have expected them to talk to us about what is an appropriate timeline or how to deal with accounts where people have deliberately left them alone, and then we’d avoid some of the problems that we are concerned will affect customers.”

This cash grab comes as economists warn the government is on track to hand down a $15 billion budget deficit in May as company tax receipts collapse.

Before Christmas, Treasurer Wayne Swan junked the government’s previously “rock solid” promise to produce a surplus in 2012-13. The government had also been committed to surpluses in future financial years, too.

In the UK this practice also exists and has for quite a number of years, with the exception that in Britain the dormancy period is a far greater one before assets are seized from such, supposedly, dead accounts.

While, it would appear, in Australia the money seized from such “dormant” accounts will be gobbled up by the treasury in the UK, at least, the money goes for so-called “good causes”, though decided upon and administered by the government.

The act of the Australian government, as the banking expert said, appears to be aimed at bolstering the country’s finances and nothing more.

Article Source

http://www.abc.net.au

About the Author

Michael Smith (Veshengro) is the editor of Green (Living) Review

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IT IS WAY PAST YOUR WAKE UP TIME!

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