How to cause a run on the banks

**Doggy Styles** · 16 March 2013, 12:20

The EU couldn't run a bath.

**suityou01** · 16 March 2013, 12:22

Originally posted by Mich the Tester View Post

Clever, clever EU finance ministers agreed a package to rescue Cypriot banks. It's not much fun as usual and as usual it involves risking taxpayers' money, so as a sort of fop to the electorates they've said the account holders will pay 6.75% on balances up to 100,000 euros and 9.9% on anything above 100,000. Surprise, surprise, people then start taking all their money out of Cyprus banks because they see they're about to lose a big chunk of it. So this 'rescue' looks a bit like finding someone in the street who's having a heart attack and slitting his wrists while giving him heart massage. All that happens is that the blood squirts out a bit faster.

What kind of idiot dreams up something like that?

Cyprus govt in race to ratify shock bank deposit tax

BBC News - Eurozone and IMF agree 10bn-euro Cyprus bailout deal

So how do I make money on this?

**mudskipper** · 16 March 2013, 13:11

If the banks have no customers, they won't need rescuing. All part of the cunning plan.

**suityou01** · 16 March 2013, 13:24

Originally posted by mudskipper View Post

If the banks have no customers, they won't need rescuing. All part of the cunning plan.

I contacted one of my buddies out there. He said they've known about this for a while, and they have been given shares in reward for surrendering their savings.

If there was a run on the banks, would the contagion spread? Unlikely. I don't think a Cypriot bank is the same as Lehmen brothers.

Storm in a teacup hopefully. Just going to short the euro like feck anyways

**KentPhilip** · 16 March 2013, 13:32

It is a tax rather than a deduction. Although it is not clear whether they would prevent you from withdrawing your cash unless you had paid it.

BBC link:

BBC News - Eurozone and IMF agree 10bn-euro Cyprus bailout deal

"People with less than 100,000 euros in Cypriot bank accounts will have to pay a one-time tax of 6.75%, while those with more will have to pay 9.9%. It is expected to raise 5.8bn euros in additional revenue."

And they have taken steps to stop a run:

"A European Central Bank (ECB) official said the Cypriot authorities had already started to take action to ensure that the levy can be collected. Otherwise, there would be a likelihood of massive withdrawals to avoid it, our correspondent adds."

**centurian** · 16 March 2013, 14:50

Of course by deliberately letting inflation run ahead of interest rates over a number of years, this achieves the same affect as if they had simply seized 5-10% of everyone's cash deposits back in 2008.

**VectraMan** · 16 March 2013, 14:57

Originally posted by centurian View Post

Of course by deliberately letting inflation run ahead of interest rates over a number of years, this achieves the same affect as if they had simply seized 5-10% of everyone's cash deposits back in 2008.

Don't forget good old printing money. That's the British way of taxing everyone's savings without them knowing they've been taxed. Why don't the Cypriots do that? Oh right.

**fullyautomatix** · 16 March 2013, 19:25

Is this even illegal ? its almost equivalent to robbing in broad daylight. What about people with no savings ? Why are they not penalised.

It certainly is scary and I just hope does not happen here in UK.

**suityou01** · 16 March 2013, 21:05

Originally posted by fullyautomatix View Post

Is this even illegal ? its almost equivalent to robbing in broad daylight. What about people with no savings ? Why are they not penalised.

It certainly is scary and I just hope does not happen here in UK.

As spackily as this is worded, whs.

How to cause a run on the banks