I do have offshore company with Cyprus company current account. Does this tax also affects my company?
I think so.
Europe Announces Bailout For Cyprus — Bank Depositors Get Instant 10% Tax
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Re: Europe Announces Bailout For Cyprus — Bank Depositors Get Instant 10% Tax
#52In some ways, this isn't a great plan. It punishes those who saved their money while rewarding those who consumed their income. It also means that people will have to start assuming that wealth taxes on bank account balances may happen in more jurisdictions and that they should move their money into what they deem to be safe jurisdictions. This could do harm to other countries whose banking systems have been having t…
Extracting money from people's bank accounts without even an acknowledgment is akin to foraging through their purses and wallets without consent. Can't you see the larger issue here? This shortsighted measure will backfire. Imagine you saved just enough money to cover rent, or see a dentist. You counted on that money being there. Wouldn't this be upsetting and a betrayal of your trust? Would you be so quick to leave…
Agreed
Re: Europe Announces Bailout For Cyprus — Bank Depositors Get Instant 10% Tax
#53Earlier quoted context omitted.
In any circumstance where a bank employee of any bank receiving a bailout receives any bonus at all - this is criminal. The first measure should be a cut of all executive pay and bonus monies in any bank that so poorly managed themselves that they needed a bailout.
In this circumstance, the first measure should be to cut losses now and dissolve the most toxic banks. Cyprus' banking system is ridiculously oversized for its economy. We need to get back to the idea of banks facilitating business, not being it.
Fantastic point about banks not being business. Totally agree.
We need a greed reset button on all economies.
Re: Europe Announces Bailout For Cyprus — Bank Depositors Get Instant 10% Tax
#54Earlier quoted context omitted.
I thought gold went up with inflation.
The only way for gold to inflate is for someone to dig up more gold, thereby increasing its supply.
Gold can be inflated the same way as any other currency. Since people don't typically trade in physical gold, but in certificates used to represent the gold, it is possible to print more certificates than you have gold. While this is a fraud, it is an increase in the money supply.
Re: Europe Announces Bailout For Cyprus — Bank Depositors Get Instant 10% Tax
#55Earlier quoted context omitted.
In no way was this a good plan. It doesn't net a significant amount of money in terms of EU GDP, and it enrages and frightens a lot of people. The difference between a government switching what it taxes and this is that the former goes through intense oversight and debate by the elected officials of the country involved. People can influence the decision and it is an internal matter. In this case, it was an external…
>In no way was this a good plan. mdasen gave some very reasonable arguments that in fact, yes, in some ways it was a good plan. Fr the reasons you gave, you can certainly argue not a good plan on balance . And I would tend to agree with you, although I would confess significant ignorance to the particulars of the situation But it is misapplication of the affect heuristic to say that because the plan stinks over all,…
He really only gave two arguments. One, that it is easier to implement, and two, that it spread the burden to foreigners.
I don't actually think this is easier to implement. Perhaps faster. In the long run, however, this is the hard way to go.
As to spreading the burden to foreigners, that's only a good thing if you're not a foreigner and you don't plan on doing business with foreigners in Cyprus.
If you are a wealthy man who has his fortune elsewhere, this is still not a good plan, because there is potential for personal repercussions.
Re: Europe Announces Bailout For Cyprus — Bank Depositors Get Instant 10% Tax
#56Is this really any different than US Monetary policy that leads to continual inflation making your savings worth less over time?
Yes. One is intended as an encouragement to invest and, it works for the most part(401k, roth, 529, etc.. etc..) Most Americans know that that just sticking your money under a mattress is stupid, so we actively invest. Just about anyone in the US with disposable income invests in some way. This is something that benefits society as money that would normally be sitting idle is out in the market being used. And, how it…
I agree with this answer. The expectation in a bank account is that whilst the interest may or may not cover inflation, at least you don't have confiscation to worry about in addition to that.
Re: Europe Announces Bailout For Cyprus — Bank Depositors Get Instant 10% Tax
#57Earlier quoted context omitted.
an old lesson that has been forgotten needs to be relearned. Money is not meant to be saved. Money is for earning and spending. Saving should be done in real tangible assets.
Actually, money is specifically designed for saving.
To paraphrase Silvio Gesell, an economist in favor of symbolic currency almost a century ago, "All the physical assets of the world are at the disposal of those who wish to save, so why should they make their savings in the form of money? Money was not made to be saved!"
Re: Europe Announces Bailout For Cyprus — Bank Depositors Get Instant 10% Tax
#58I do have offshore company with Cyprus company current account. Does this tax also affects my company?
Yes, if your money is in Cyprus. You will be granted shares in your bank of equivalent value to your losses. Does it help? LOL
Re: Europe Announces Bailout For Cyprus — Bank Depositors Get Instant 10% Tax
#59I've submitted this first but it didn't take off...
Anyway: this is just the beginning and it's not going to stop anytime soon. The Eurozone is in big trouble: it simply cannot work when you have people who only want to work 32 hours / week and stop working at 60 years old (France) while on the other side you have hard-working germans.
The crisis we're witnessing since a few years in the eurozone is really simple: the GDP growth number in most of the eurozone are fake in that they do not correspond to wealth created but to wealth created + state debt. Nearly every single country in the eurozone is running at deficit.
The crisis is due to one and only one thing: states that are so indebted that they cannot borrow anymore.
Economists warned about precisely that scenario before the first euro even circulated: Greece, Spain, France, Cyprus... 15 years ago people warned that it would happen just like that. It was just a matter of time.
I can tell you what's coming next: Greece is going to default a second time.
In 2014 France shall have its deficit skyrocketing and shall have issue re-financing itself on the market.
France is the 2nd biggest economy of the eurozone and the eurozone is f^cked. It's game over. France has taxed the private sector so much that it cannot tax it anymore and, anyway, it's too late: investors did flee the country and now individuals are engaging in a bank run (or leaving the country).
The obvious solution would be a massive devaluation of the euro but this cannot happen because if it happens Japan goes down (and probably the U.S.).
We're near the endgame: the house of cards may fall soon.
And I can tell you thing: I want less state. This entire euro-crisis is a debt of sovereign states having way too much public debt because they've constantly been running at deficit, for decades. And now they're running out of money.
It didn't help that they borrowed money to save banksters but don't be mistaken: nobody forced these states to run with crazy-high deficit for decades.
F^ck socialism. Really f^ck it.
Btw I don't care if Cyprus was supposed to be very liberal: Cyprus is 0.2% of the GDP of the eurozone and doesn't matter.
What matter is that socialist Spain, Greece, Portugal and France are close to state default.
They'll be watching closely how announcing money confiscation just before a long week-end plays out (monday is a legal day off in Cyprus) and they'll probably be desperately trying to do the same in these countries.
And it's not going to work.
People should really start realizing that Keynes was all wrong all along and that the Friedman school is the only correct one: they did predict all this. Keynesians didn't.
Btw if the eurozone goes down dont' think the U.S. is going to be fine: some economists are predicting a worldwide drop of the world GDP by as much as 30%.
It's just a matter of years, maybe less.
Re: Europe Announces Bailout For Cyprus — Bank Depositors Get Instant 10% Tax
#60Anyone want to put odds on this starting bank runs across Europe?