Cyprus bailout

[krusty]

I know this subject is mainly only of interest to me , and has dropped out of the headlines for now .

But a Cypriot minister has today been speaking in the house of commons and some of what he said could apply to other countries bank accounts .

"This question remained unanswered since the burst of the housing bubble in the US that led to the global financial crisis. Answers were required in order to find alternative ways to fund these falling banks, without the contribution of the EU taxpayers. Cyprus was the perfect candidate to put new ideas to the test. It represents only a small percentage of the EU economy and, as it was supported by some, a possible collapse of its economy would be a non-systemic event. So, instead of being treated as an EU partner, Cyprus became an economic guinea pig. The long conceived economic practice of the ‘bail in’ has been implemented in the ‘low-risk’ case of Cyprus, in order to figure out if it can be successful and be used in other, bigger EU economies. Great efforts were undertaken to calm EU and world economies, stating that the decision adopted for Cyprus was a ‘one off’ case and that it did not constitute a precedent.

The reality was different and soon it became apparent. The statement by the Eurogroup President, Mr Dijsselbloem, that the model used on Cyprus may shape the way Eurozone banks are saved in the future, despite the fact that it was immediately retracted for reasons of complacency, reflected the intentions for future ‘bail ins’. "

http://www.moi.gov.cy/moi/pio/pio.nsf/All/7F8F4DEEA63331AFC2257B5700639F75?Opendocument

[NormanH]

I think that there is no reason for complacency, and that a sort of watershed has been crossed.

In the future the banks will just be able to seize assets such as savings.[:@]

[Patf]

I think many people saw this coming, but didn't want to face it.

Already in France public utilities can access and empty our bank accounts if we're in arrears and show no signs of paying up.

[Pickles]

If the pronouncements made by various politicians - Cypriot, German, Dutch - had been designed to wreck confidence in banks, they couldn't have said it better. Is this part of a ploy to get people to spend their savings?

In the UK, both Conservative and Labour governments have attacked pension savings. Banks are no longer safe. Sovereign bonds are not safe. On the one hand, governments want us to save for our future and castigate those who don't - and yet with the other they put our savings at risk or take them away.

[Quillan]

I saw this in todays Guardian

http://www.guardian.co.uk/business/2013/jun/27/eu-deal-bank-bailout-taxpayers

 

[suein56]

[quote user="NormanH"]In the future the banks will just be able to seize assets such as savings.[/quote]

They already have, in a fashion, as we had the type of investment in the Co-op which has just been sequestered to help rectify the Bank's financial black hole. We had no optionin the matter as our funds were frozen. The Bank's opinion is/was : as there were only 7,000 such investers what does it matter if they lose their money ?

So much for the idea of us providing for our retirement.

Sue

[NormanH]

"The rules foresee that banks' creditors and shareholders would be the

first to take losses. But if that were not enough to prop up the

lender, small companies and ordinary savers holding uninsured deposits

worth more than 100,000 euros (£85,000) would also take a hit, officials

said.

Those forced losses would go as high as 8% of a bank's

total liabilities. Only then would national governments kick in and top

it up with a bailout possibly worth another 5% of the liabilities."

[Quillan]

So don't keep more than 100k in any one bank.

[NormanH]

You having a laff???

The only thing I have in the bank is an overdraft [:)]

[NickP]

[quote user="Quillan"]So don't keep more than 100k in any one bank.[/quote]

That's alright if there are enough banks covered by the financial services regulations, but if not what do we do?  [Www]

[Pierre ZFP]

Stuff it under the mattress of course

[suein56]

[quote user="NormanH"]

"The rules foresee that banks' creditors and shareholders ... [/quote]

OH and I came under the small-scale shareholders banner. No way do we have £100K anywhere !

Sue

[Quillan]

[quote user="NickP"]

[quote user="Quillan"]So don't keep more than 100k in any one bank.[/quote]

That's alright if there are enough banks covered by the financial services regulations, but if not what do we do?  [Www]

[/quote]

Pierre beat me to it. Do what the Greeks and probably the Spanish do, stick it under the bed.

[krusty]

Do not be lulled into a false sense of security re the 100k rule , nothing is safe.

Here in Cyprus we were warned if the the banks went under the guarantees would count for nothing as the government did not have the funds to underwrite them.

So under the bed could be the best option.

[Rabbie]

[quote user="krusty"]

So under the bed could be the best option.[/quote] At least until some dishonest person gets access to your house and helps themselves[6]

[Chancer]

[quote user="NickP"]

[quote user="Quillan"]So don't keep more than 100k in any one bank.[/quote]

That's alright if there are enough banks covered by the financial services regulations, but if not what do we do?  [Www]

[/quote]

If you need more than say 4 or 5 banks then share any excess amongst those of us that dont have that problem then we can share your suffering [:P]

[NickP]

[quote user="Quillan"]   

Pierre beat me to it. Do what the Greeks and probably the Spanish do, stick it under the bed.

[/quote]

Problem is Q the ceilings in the houses in Kensington Palace Gardens are quite low.