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Tuesday, March 26, 2013

Cyprus: curiouser and curiouser

First, one of the EU's finance ministers suggested that the bank raids are not going to end with Cyprus.
Savers in the eurozone could see their bank accounts raided in the struggle to shore up the single currency, a senior EU official warned last night. The Cyprus rescue package – under which bank customers will have a chunk of their cash seized to bail out troubled lenders – could become a template for dealing with other creaking banking systems, Jeroen Dijsselbloem suggested. The remarks from the head of the eurozone’s finance ministers contradicted days of assurances that the Cyprus bank deposit raid was a ‘one off’.
Second, it appears that the news of the big 40% cash grab from uninsured depositors, (those with over EUR 100k in the bank), may be more than a little misleading, which may account for the strange silence from Russia over the last few days.  Zerohedge notes a Reuters report and postulates that the hot money which is supposedly the focus of the heist may already be well off the island.
As it turns out, these same oligrachs may have used the one week hiatus period of total chaos in the banking system to transfer the bulk of the cash they had deposited with one of the two main Cypriot banks, in the process making the whole punitive point of collapsing the Cyprus financial system entirely moot.

From Reuters: "While ordinary Cypriots queued at ATM machines to withdraw a few hundred euros as credit card transactions stopped, other depositors used an array of techniques to access their money."

No one knows exactly how much money has left Cyprus' banks, or where it has gone. The two banks at the centre of the crisis - Cyprus Popular Bank, also known as Laiki, and Bank of Cyprus - have units in London which remained open throughout the week and placed no limits on withdrawals. Bank of Cyprus also owns 80 percent of Russia's Uniastrum Bank, which put no restrictions on withdrawals in Russia. Russians were among Cypriot banks' largest depositors.

So while one could not withdraw from Bank of Cyprus or Laiki, one could withdraw without limitations from subsidiary and OpCo banks, and other affiliates?
In other words, the idea that the situation has somehow been successfully resolved is not only ludicrous from a structural perspective- at most it would amount to one more round of successful can-kicking - but may not even be the case with regards to postponing the inevitable crisis and crackup.

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38 Comments:

Blogger Rantor March 26, 2013 6:32 AM  

This is just brilliant crisis production. The thought of closing banks locally but keeping international branch offices open, to allow the truly big depositors to get out is appallingly evil. It only points to the truth that the game is rigged to save the rich and powerful while destroying the masses.

Must keep in mind when US crises hit. Your bank may be closed, but. The London branch??? Probably worth your while to fly over and wrap up business.

Anonymous p-dawg March 26, 2013 7:08 AM  

@Rantor: Canada is closer, and so would be worth checking first, I believe. Good idea, though.

Anonymous CJ March 26, 2013 7:13 AM  

This is the beta test. They will fix that bug.

Anonymous trk March 26, 2013 7:17 AM  

why are Cyprus banks so bad they needed a EU bailout in the first place? Bad real estate loans?

Anonymous Starr March 26, 2013 7:24 AM  

So they found a way to get some money out of the people, but not get killed by some former KGB agent down the tracks, so they avoid reality for just a little longer.

Blogger LP 999/Eliza March 26, 2013 7:48 AM  

Bric by terrifying bric is still theft.

Anonymous VD March 26, 2013 7:48 AM  

Choose a name, please, Anonymous.

Blogger Nate March 26, 2013 7:49 AM  

So... they've created an international monetary crisis... given the Russians a glorious excuse to establish a permanent fleet off their southern shore...

for what again?

Anonymous Outlaw X March 26, 2013 7:50 AM  

I guess there is honor among theives. I know why they want the guns and why they are buying all the bullets so we can't get any. They miscalculated, not only are they not going to get the guns, we already have the bullets let them buy away. I have never seen such incompetence in people. especially those who would want to take over the world, my 5 year old niece could have come up with a better plan. Dumbasses!

Anonymous Outlaw X March 26, 2013 8:02 AM  

for what again?

I find myself asking the same question. I have no clue other than to chalk it up to a bunch of incompetent boobs. How do they manage to put their pants on or wipe their ass?

Anonymous zen0 March 26, 2013 8:03 AM  

why are Cyprus banks so bad they needed a EU bailout in the first place? Bad real estate loans?

Sounds like they invested heavily in Greek bonds, seeing as it was such a good deal and all.

Anonymous Outlaw X March 26, 2013 8:07 AM  

Anon, Just go to Name/URL and put any name in you can leave the URL blank, I do.

Blogger Nate March 26, 2013 8:07 AM  

Anon

Click Name/URL...

Then make up any name you wish and type it in... and either put in your own blog or homepage in the URL or leave it blank.

Blogger Nate March 26, 2013 8:10 AM  

At this point I am starting to think we have to go with pure ideological motivations. I think the eurotrash may really have been thoroughly pissed at perceived tax evasion in Cyprus and now they just are out for blood. They aren't trying to fix anything. They want to punish and destroy.

Anonymous JartStar March 26, 2013 8:11 AM  

So to recap the major lessons so far:

1. They will come for your cash.
2. The wealthy and powerful will not be subject to the same theft.



Blogger Markku March 26, 2013 8:13 AM  

They want to punish and destroy.

This I can understand.

Anonymous JartStar March 26, 2013 8:22 AM  

Nate,

The DOJ is going after traditional tax havens so maybe this is a warning from various central banks and they trying to scare people from moving money off shore before things get bad.

Blogger Nate March 26, 2013 8:27 AM  

Nate's Theory Number 2:

Some Russian Billionaire and or Billionaires pissed off someone extremely powerful... and that someone is employing the IMF and EU Central Bank to attempt to destroy the russians in return. If a nation here or there gets totally wrecked... so be it.

Blogger Nate March 26, 2013 8:32 AM  

"Wanna bet? This isn't a country of dumb greasers in the Mediterranean Basin. "

Yeah that's crazy JartStar. Can you name a single time the government of the US has stolen wealth from people outright? I mean like... confiscated wealth from them... like... stolen gold out of their deposit boxes at banks or something?

I didn't think so.

Anonymous Sigyn March 26, 2013 8:32 AM  

Bankstas gon' banksta.

Anonymous Outlaw X March 26, 2013 8:36 AM  


I think they just run around naked with a dirty bottom.

Blogger Nate March 26, 2013 8:52 AM  

Anon... pick a name.. or piss off.

Anonymous Athor Pel March 26, 2013 8:53 AM  

" JartStar March 26, 2013 8:11 AM
...
2. The wealthy and powerful will not be subject to the same theft."




Yet.


This financial chaos is not ending any time soon. The early stages of the game are over, the position building is done. The attacks are starting.

There will be wealthy sacrificial victims to assuage the anger of the masses, once things get bad enough, but not until then. But any respite will only be temporary and calculated.

After that there will be open war. During the war there will be willing traitors among the wealthy. In time many of them will be killed off for two reasons, one being they cease to be useful and two, hey, they're traitors, you can't trust them. Don't worry about the wealthy and powerful, events will deal with them.


The funny thing to me is how many people genuinely see this as a financial game they know and by that knowledge think they will survive and thrive. What they have failed to realize is that there are those that are not playing the same game. Nothing more demoralizing or shocking than watching an enemy piss all over the deal you think he can't refuse because you think to refuse would damage him as much as you. Not everything is calculated in dollars and cents.

You put your faith in dollars, (any money really), and then you watch all dollars turn to dust before your eyes. What will that do to people? How will that affect their state of mind? Just how much desperation will that generate? What will they agree to in order to push back the fear?

You wanna know where this is going? The chaos is leverage, leverage to win minds, win minds in order to build a new world on an ancient model.

Anonymous JI March 26, 2013 9:06 AM  

Typical. The average Joe gets screwed while Russian oligarchs who stole and pillaged the money from the remnants of the USSR get off scott-free.

Anonymous Outlaw X March 26, 2013 9:15 AM  

Bye Bye.

Blogger Nate March 26, 2013 9:33 AM  

Ok... so the Eurotrash have already announced that depositors will be robbed in Spain and Italy when the time comes.

So we can therefore assume that they considered the experiment in Cyprus to be a successful one. Which means... the total destruction of Spain and Italy... is an acceptable outcome.

Anonymous JartStar March 26, 2013 9:50 AM  

So we can therefore assume that they considered the experiment in Cyprus to be a successful one. Which means... the total destruction of Spain and Italy... is an acceptable outcome.

Yep, they are so confident now they are telegraphing their next move. It's looking more and more like nobody wants to be left with the worthless paper rather than try to print.

Blogger James Dixon March 26, 2013 9:56 AM  

> Sounds like they invested heavily in Greek bonds, seeing as it was such a good deal and all.

My understanding is that's the case, yes.

Blogger Nate March 26, 2013 10:30 AM  

"Yep, they are so confident now they are telegraphing their next move. It's looking more and more like nobody wants to be left with the worthless paper rather than try to print."

No.

They don't want to print because the paper is what is causing them difficulties in the first place.

They want control. Vox is wrong. Control is not a happy coincidence. Control is what they want. Paper allows all manner of economic activity that is not under their control.

Blogger IM2L844 March 26, 2013 11:00 AM  

After reading the comments on Cyprus-Mail.com, I'm astounded by the number of people who have been hornswoggled into believing they are getting a good deal.

Anonymous Aeoli March 26, 2013 11:04 AM  

Bodycount. I've said it before and I'll say it again. They've been preaching population reduction for decades. Why not take their word for it?

Blogger IM2L844 March 26, 2013 11:07 AM  

No.

They don't want to print because the paper is what is causing them difficulties in the first place.



Nate, as a slightly OT aside, MoM weighs in on the "What is money?" issue.

Blogger Nate March 26, 2013 11:10 AM  

"Nate, as a slightly OT aside, MoM weighs in on the "What is money?" issue."

I don't think it will be shocking for anyone if I say.... I'm not impressed.

Anonymous Porky March 26, 2013 11:12 AM  

Please. Are we expected to believe that the EU 1) Totally forgot to count the votes in parliament, 2) Totally forgot that they actually don't need parliament, 3) Totally accidentally waited too long allowing all the gangsters to move their money to different banksters, and 4) are now warning other countries that they will do the same knowing full well that no one with a brain will leave their fortune in a Spanish/Italian/Portuguese bank?

This is the global finance equivalent of "Why I ought to sock you - I'm reeeeally gonna sock you- I'm about to totally sock you in the nose - hey look up there in the sky...!"

Why are you guys falling for it?

Blogger IM2L844 March 26, 2013 11:50 AM  

I'm not impressed.

Figured as much, but was thinking of the entertainment value for myself if you happened to pop in over there to straighten her out. I bet you can get her to call you names. ;)

Anonymous Conrad The Crazed March 26, 2013 12:35 PM  

LOL....this was no more a 'mistaken oopsie oversight', than I am Peter Parker, the Amazing Spiderman.

The Russian oligarchy was always going to be allowed to keep their money, as many of them are likely members of the globalist Big Boys Club (aka new world order). This appears to be what others have already stated, a totally engineered 'test crisis' lab experiment. First on a small scale like Cyprus. Then, if the 'lab' isn't a smoking ruin as a result, adjust input parameters on successively larger scales until eventually there is a 'kaboom' of one form or another.

At that point, present the 'solution' of global governance as the antidote to 'regional instabilities and corrupt influences seeking to exploit the people of the global community'. Sure, this might require martial law in some places, but in many others it will be received by the proles with thunderous applause.

Besides, had they actually done what they insinuated, and confiscated Russian oligarchial funds, I'm thinking Boris and crew would have protested somewhat....ummmm....vigorously. Many unfortunate accidents and pre-existing undiagnosed 'conditions', yes?

Anonymous Johnycomelately March 27, 2013 7:22 AM  

I guess I don't understand banks but aren't deposits capital reserves?

If reserves are diminished doesn't that mean outstanding loans are backed by less reserves and wouldn't that breech minimum reserve requirements?

Or is the implication the outstanding loans are going sour and guaranteed to fail? Or is just a liquidity issue?



Anonymous Anonymous March 28, 2013 4:25 PM  

johnycomelately

I guess I don't understand banks but aren't deposits capital reserves?

If reserves are diminished doesn't that mean outstanding loans are backed by less reserves and wouldn't that breech minimum reserve requirements?

Or is the implication the outstanding loans are going sour and guaranteed to fail? Or is just a liquidity issue?


One of the problems is that the banks have been ignoring these rules for years. They havent been above minimal reserve status in probably a decade, and now with the economy contracting worldwide, they cant cover this up as easily, nor rely on that money coming back in any time soon, if at all.

I do wonder if cyprus is being burned so that the rest of the eurozone banks can write off a bunch of bad loans and re-jigger thier accounting to make it look like cyprus' fault, and have the EU step in and replace these "Stolen" accounts. Insurance fraud with cash money instead of planes trains and automobiles? I cant understand the apparent incompetance of the thieves in brussels. The Theft I can understand, but to do it so poorly? I thought white collar criminals were supposed to be HARD to catch in the act.

John VI

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