Haircuts are just so yesterday. Today we have closures, restructures, freezing….
….and no need to consult Parliament
Somewhere, George Orwell is spinning in his grave – although he wouldn’t be even remotely surprised by the 1984-style nonsense being hailed as a compromise by the Troikanauts (above) and Nicosia’s embarassed leaders.
This is the deal: the levy is
called something else scrapped, and none of the deposits below €100,000 will be stolen included.
lunacy idea sees Laiki Bank closed. The entirety of its €4.2bn in deposits over €100,000 will be placed in a “bad bank”: why you would put healthy deposits in a bad bank eludes me, but we’re really just moving the stash around here: the bad bank’s resources will be confiscated. We’re talk a 100% haircut for all these savers.
And don’t be fooled by the Berlin propaganda about Russian money-laundering. First up, being a rich Russian doesn’t automatically make you a crook; and secondly, nowhere near all – possibly under half – are Russian anyway: UBS, several Israeli banks, a number of French banks will have depositor’s money taken out of them to pay for the ambitions of Brusels-am-Berlin.
There’s more: all the bondholders in Laiki also take a 100% haircut.
The remaining smaller deposits at Laiki will be transferred to Bank of Cyprus, the nation’s largest lender, which in turn will be shrunk and completely ‘restructured’. Here, the term being used for thieving other people’s deposits over €100,0000 is ‘frozen’. In fact, I have it on very good authority that these too will disappear…and become Yul Brynner-style haircuts.
Significantly – but little noticed – NO EU bailout funds were used in the excavation of Cypriot banking resources. Merkel has fulfilled her promise to remove Cyprus as an offshore banking economy. We can’t have those: after all, folks might start using them to evade EU fleecing, and then where would we be?
Newly combined, the Laiki and Bank of Cyprus will account for about half of all deposits in the country. Bank of Cyprus will also take on the €9bn debt Laiki ran up on the eurosystem that has over the last two years become ClubMed’s hidden dripfeed….especially for Spain. So there’s another nice UXB waiting to go off some time soon.
The EU line, as usual, is that ‘the small depositors have been spared’. So if the burglar leaves your house alone, you’ve been spared. The neck of these people beggars belief.
Entirely appropriate however was the choice of Wolfgang Schäuble to face the cameras and ‘explain’ why none of this would need the approval of the Cypriot Parliament. Just “approved by the 17 eurozone finance ministers comparatively quickly, after about two hours of further deliberations”. As to why it needed FinMin approval (but not that of the citizens’ representatives) get a load of this for jargonised bollocks:
“This plan will not require the approval of the Cypriot parliament because the losses on large depositors will be achieved through a restructuring of the island’s two largest banks and not a tax.”
‘The parliament passed a new law governing bank failures just three days ago at Brussels’ urging’ writes the FT. Just fancy that.
Global looting is coming your way: say goodbye to your cash, your investments, and your democracy. This is life in the German-dominated European Union.