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“My bank account's got robbed by European Commission. Over 700k is lost.”

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Re: “My bank account's got robbed by European Commission. Over 700k is lost.”

#111

Post by bayesianhorse »

gurvinder wrote: post #33
wmt wrote: post #21

What is the poster suggesting? EC should've stayed out and let the banks go bankrupt? Oh I know, they should've just covered all the tax haven banks losses.

EC should have treated Cyprus in same manner they treat other countries which are part of Euro Zone. If they can bail out Greece without a haircut which actually caused crisis in Cyprus, why do this against Cyprus? Also it might be a tax haven for others , but for Cypriots its their country. And this haircut is applied to everybody who has deposits in the Cypriot branches of Laikie bank but Same bank has branches in…

Cypriots had continously higher interest rates on their deposits than other Europeans. The small levy wouldn't even have eaten up these profits which are essentially due to tax havenry and unsound business practices on a country wide scale. No pity there...

Even if the 7% levy was all hard-earned money instead of too high interest rate profits, this would have hardly bankrupted more than a few depositors which were in dire straits already.

Re: “My bank account's got robbed by European Commission. Over 700k is lost.”

#112

Post by oellegaard »

While I would probably have the same reaction if I was living in Cyprus, important points are missing here.

The way I understand it: Cyprus failed to control their economy and required the help from the European Union. In order to lent them a crazy amount of money, they wanted some guarantee. They could not provide anything, so their government had to use the peoples money to pay for the governments previously bad judgement about not saving up for bad times.

Re: “My bank account's got robbed by European Commission. Over 700k is lost.”

#113

Post by gurvinder »

bayesianhorse wrote: post #111
gurvinder wrote: post #33

Earlier quoted context omitted.

EC should have treated Cyprus in same manner they treat other countries which are part of Euro Zone. If they can bail out Greece without a haircut which actually caused crisis in Cyprus, why do this against Cyprus? Also it might be a tax haven for others , but for Cypriots its their country. And this haircut is applied to everybody who has deposits in the Cypriot branches of Laikie bank but Same bank has branches in…

Cypriots had continously higher interest rates on their deposits than other Europeans. The small levy wouldn't even have eaten up these profits which are essentially due to tax havenry and unsound business practices on a country wide scale. No pity there... Even if the 7% levy was all hard-earned money instead of too high interest rate profits, this would have hardly bankrupted more than a few depositors which were i…

7% levy was proposed on all accounts, and it was illegal to put levy on insured deposits, and it was asked to put this levy on all banks even if they are solvent.

Can you quote what high interest rates are you talking about on deposits? And what about interest rates on Current Accounts? Business usually pay money to have these accounts.

Cyprus also has higher interest rates on mortgages, and most Cypriots have mortgages, so they are not actually having any profits because of "so-called" high rates.

If European Union is so concerned about Tax-Haven issues, why didn't they come clean and ask Cyprus to raise tax rates as they did in 2004 when Cyprus joined European Union, And what about Luxembourg, isn't it where Apple is registered for saving taxes ??

Re: “My bank account's got robbed by European Commission. Over 700k is lost.”

#114

Post by danmaz74 »

So, you deposit your money in a bank with very high interest rates - very high because they invest in risky Greek bonds. If everything goes well, you keep the interests. If the risky investment of the bank goes bust, we (EU citizens) should pay you the risk, even beyond the insured 100k. Is that correct?

Re: “My bank account's got robbed by European Commission. Over 700k is lost.”

#115

Post by rmp2150 »

bayesianhorse wrote: post #110
rmp2150 wrote: post #46

Earlier quoted context omitted.

The events unfolding in the Eurozone is the result of it being only a monetary union instead of a fiscal and monetary union. Milton Friedman predicted this would happen in '04.

Tons of people predict tons of doom in advance... It's not really a smart idea to pick the "correct" doomsayer a decade later...

First off, Friedman is not a doomsayer. Friedman correctly diagnosed the underlying causes of the Eurozone's malaise a decade ago. If the Eurozone entered into a fiscal union, much of the fundamental problems would be remedied. Political pressure/forgoing of sovereignty makes such an event highly improbable.

Re: “My bank account's got robbed by European Commission. Over 700k is lost.”

#116

Post by SODaniel »

skrebbel wrote: post #72

Oh boohoo. The OP appears to forget that without the European Commission, all of his money would be lost. It's like getting mad at the guy who chainsaws you out of the car that you folded around a tree because he sawed your car into two pieces.

Not to mention that it seems like in this case the person in question may be whining about untaxed funds that he skimmed of his company. Oh no, I am being robbed of money that wasn't mine!!

Re: “My bank account's got robbed by European Commission. Over 700k is lost.”

#117

Post by danmaz74 »

_b8r0 wrote: post #107
Shenglong wrote: post #37

Background and summary (forgive me if some details need correcting): Cyprus is a tiny country with a GDP not much higher than Tim Hortons. Yet, it had something like 150 billion in private funds stored in two of its banks: the Bank of Cyprus and Lakie. Why? Because the majority of the funds (I am generalizing) belongs/belonged to Russians who took advantage of the people on the conversion out of communism (dirty mone…

> Greek's insolvency impacted Cyprus greatly, because a large portion of the Cyprus population are of Greek descent. Just to add a little context to this. Cyprus is a divided country, as a result of a conflict in 1973 between Turkish Cypriots (and Turkey) and Greek Cypriots (and Greece). The Greek Cypriots favoured unification with Greece (Enosis) whereas the Turkish minority felt threatened by this (due to various t…

You forget that Cyprus' banks are bankrupt because the did bad investments; it's not as if "the IMF wanted to restructure Cyprus' banking system" because they woke up one morning and just felt like that.

Re: “My bank account's got robbed by European Commission. Over 700k is lost.”

#118

Post by _b8r0 »

danmaz74 wrote: post #117
_b8r0 wrote: post #107

Earlier quoted context omitted.

> Greek's insolvency impacted Cyprus greatly, because a large portion of the Cyprus population are of Greek descent. Just to add a little context to this. Cyprus is a divided country, as a result of a conflict in 1973 between Turkish Cypriots (and Turkey) and Greek Cypriots (and Greece). The Greek Cypriots favoured unification with Greece (Enosis) whereas the Turkish minority felt threatened by this (due to various t…

You forget that Cyprus' banks are bankrupt because the did bad investments; it's not as if "the IMF wanted to restructure Cyprus' banking system" because they woke up one morning and just felt like that.

I didn't mention it because the previous poster made a very valid point about ethnic Greeks speaking Greek next to Greece investing in Greek assets.

However there was no reason as to why a country with such a small economy should come up with an arbitrary 6 billion euro for a 10 billion euro bailout beyond forcing political will over a small country to send a signal to others. If you need 10 billion euros, you're not going to be able to find a quarter of your peak GDP at a time that your banks are screwed by yourself.

Re: “My bank account's got robbed by European Commission. Over 700k is lost.”

#120

Post by ptaipale »

ansgri wrote: post #102
gregsq wrote: post #65

Earlier quoted context omitted.

Very true I think. When the banks started to fold in the UK I split my cash into units of up to £35000 each into different banks. The guarantee was per institution, not individual. It certainly made more sense to me to fit within the guarantee limits, though there was no absolute guarantee that even those limits would hold.

Is the EU EUR100k guarantee per person and not institution?

Per person depositing in an institution. On European level, it would be futile to try to limit it to EUR100k per person, for many reasons, for instance because lots of people can have multiple identities -- expect perhaps in the Big Brother societies in the northern EU countries, where you can actually do a census by saying SELECT COUNT(id) FROM population WHERE alive=1;

Moreover, how would you treat accounts that are not owned by a person, but e.g. companies?

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