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The madness of the bailout in Cyprus

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Re: The madness of the bailout in Cyprus

#61

Post by [deleted] »

dougk16 wrote: post #54
khuey wrote: post #47

Earlier quoted context omitted.

If you think gold is a predictable and low-volatility store of value you really should look at inflation adjusted gold prices from 1980-2000.

I didn't mean to imply that I would expect to make money from buying gold (if that's what you mean). Even if gold prices were expected to drop, I'd still be interested in buying it as an insurance policy. No matter how severe a crisis, once the dust settles, gold will always be worth something, for reasons I don't understand.

[deleted]

Re: The madness of the bailout in Cyprus

#62

Post by omgyeah »

st0p wrote: post #59
omgyeah wrote: post #41

Earlier quoted context omitted.

I wish you won't ever see the consequence of dire actions against you or your family. You have no idea how it feels like. You have no idea how unfair it is. In case that you have not realized it, you are not paying any money. You are loaning with loan-shark rates. Have you ever heard of a loan-shark losing money? Things are much more complicated than black or white. Greece and Cyprus are not independent countries. Th…

>> In case that you have not realized it, you are not paying any money. O yes I am. I'm paying taxes here to keep your economy afloat. I don't mind that, but I'm not going to respond all of the rest you posted.

OK. I agree with you. And I am paying money to keep your economy afloat.

Can you see how stupid this is?

Little guys fight each other. And the winner gets eaten by the big guy (= bank).

Re: The madness of the bailout in Cyprus

#63

Post by st0p »

ameister14 wrote: post #46
st0p wrote: post #29

To quote the article: "This is why The IMF and the ECB has stepped in and bailed out the banks. Rumor has it that without the bailout Cyprus two largest banks would be bankrupt in a matter of days. A situation no economy can survive, especially not one with a disproportionally large banking sector." I don't see the problem to be honest. We (I live in the Netherlands) are paying a lot of money to help them out, which…

The thing is, your country signed an agreement to help them if they need it. You don't get to punish them for the fact that you are upset to have to meet your obligations.

We're helping them and meeting our obligations. In what way are we punishing them? Yeah, it's not nice to lose 6.75% of what you have in savings (the 9.9% is only for those who have more than 100.000 euro in their bank account), but the alternative would be much worse for the Cyprians.

[edit] And yeah, this is a very crude way to raise the money. Given more time, a better way is probably possible. But I think time is at a premium now.

Re: The madness of the bailout in Cyprus

#64

Post by khuey »

krcz wrote: post #56
caf wrote: post #45

Earlier quoted context omitted.

What about if the alternative is no bailout, the bank goes under, and you get almost nothing back at all? Like it or not, when you deposit 100 euros in a bank, you don't have 100 euros anymore - you instead now have an unsecured bank debt with a face value of 100 euros.

All banks (at least in Poland) are backed up by kind of guarantees fund, which allows to return some money to clients in case of bankruptcy. (WRONG INFO: It's 100% for amounts But it's kind of risk you should be aware of when keeping money in bank. Simple taking money from accounts under risk of bankruptcy isn't.

And what good did that 100% up to 100k EUR do people with bank accounts in Cyprus? That's the whole point. They broke the deposit guarantee. Now you really do have an unsecured bank debt.

Re: The madness of the bailout in Cyprus

#65

Post by wintersFright »

omegaworks wrote: post #12
[deleted] wrote: post #6

[deleted]

Actually, what's preventing someone from just putting their savings in bitcoin, waiting on the tax issues to pass, and moving it back?

There is always a bank holiday when these things are announced - otherwise you would see real chaos!

Re: The madness of the bailout in Cyprus

#66

Post by A1kmm »

jasonlingx wrote: post #27

A good reason to keep your cash in bitcoin ;)

Even if you keep your cash in fiat currency cash (i.e. euro notes) you would be safe from this.

Keeping your money in some form of cash (whether bank notes or Bitcoin) generally puts you in a worse position than low risk (i.e. diversified) investing. An investment bank which kept accounts in Bitcoin and paid out in Bitcoin would still be at risk of government seizures (unless they operated illegally and hid their identities and location, like Silk Road - but they would then have difficulties enforcing loans, and their depositors would have very little recourse if the bank decided to default and steal all the assets).

Re: The madness of the bailout in Cyprus

#67

Post by krcz »

khuey wrote: post #64
krcz wrote: post #56

Earlier quoted context omitted.

All banks (at least in Poland) are backed up by kind of guarantees fund, which allows to return some money to clients in case of bankruptcy. (WRONG INFO: It's 100% for amounts But it's kind of risk you should be aware of when keeping money in bank. Simple taking money from accounts under risk of bankruptcy isn't.

And what good did that 100% up to 100k EUR do people with bank accounts in Cyprus? That's the whole point. They broke the deposit guarantee. Now you really do have an unsecured bank debt.

What do you mean? Won't things described here: http://www.centralbank.gov.cy/nqcontent.cfm?a_id=8158&la... work in case of bankruptcies of these two banks?

Re: The madness of the bailout in Cyprus

#68

Post by hristov »

amalag wrote: post #37
DannoHung wrote: post #18

Funny that it's targeting only bank accounts and completely ignoring all other liquid assets. By which I mean: Holy shit, if this isn't targeted directly at middle class and lower households and small businesses, I don't know what would be. Also, these guys have all got to be huffing paint if they think a run on the banks won't be a direct result EVEN AFTER THE MONEY IS GONE.

Wealthy Russians take a 10% cut on their deposits. Cyprus is a tax haven. Or the government has to bail out the banks via debt. Only the US can do that since the world buys oil in dollars and if we devalue our currency we can spread the pain. Cyprus cannot make decisions about their currency unilaterally.

Lets call a spade a spade -- they cannot make decisions about their currency because they are using the euro and thus do not really have control over their currency.

Re: The madness of the bailout in Cyprus

#69

Post by omgyeah »

st0p wrote: post #63
ameister14 wrote: post #46

Earlier quoted context omitted.

The thing is, your country signed an agreement to help them if they need it. You don't get to punish them for the fact that you are upset to have to meet your obligations.

We're helping them and meeting our obligations. In what way are we punishing them? Yeah, it's not nice to lose 6.75% of what you have in savings (the 9.9% is only for those who have more than 100.000 euro in their bank account), but the alternative would be much worse for the Cyprians. [edit] And yeah, this is a very crude way to raise the money. Given more time, a better way is probably possible. But I think time is…

Please, you are not helping anybody. Nobody has ever paid back a loan with a bigger loan.

It's just an excuse to take your money too and blame someone else for doing so.

Re: The madness of the bailout in Cyprus

#70

Post by omgyeah »

chailatte wrote: post #2

If I were in Greece, Italy, Spain, or Ireland, I think I would pull out all my bank deposits but the bare minimum cash needed to cover obligations.

But if everybody keeps thinking like that, in a few years time in the place of "Greece, Italy, Spain, or Ireland" you will read "Germany, France and UK".

It's just a worldwide poker game, the banks are winning and the small guys are being forced out of the table.

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