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geoffreys wrote: ↑Thu Mar 30, 2017 5:15 pmGood job the UK will soon be out of all that nonsense! Geoff.
So was it nonsense when the EU - as part of the Troika - bailed out Cyprus and it's banks in 2013? Or should the country have been allowed to go down the swanneee (which it would have done without back-up from the EU).
Didn't the Cyprus bail out include a raid on peoples bank accounts. I seem to remember it was not the most popular move by Merkel and Co.
This is one very distinct link between the raids (which were appalling) and the EU, which wasn't involved,.....
Apologies: It would seem I might be wrong....
Last edited by Jimgward on Sun Apr 02, 2017 1:15 am, edited 1 time in total.
Hudswell wrote: ↑Sat Apr 01, 2017 11:36 am
I don't expect it to raid the bank accounts of its Citizens....I expect it to provide a fair and just solution, yes Cyprus was in deep,do do, just like Spain, Portugal Italy and Greece, failing economies propped up by the EU, how many of their citizens were effectively robbed?Cyprus is a small country, with a small economy, it was made an example of by a cruel spiteful organisation who cares nothing, which with the rhetoric now coming out of its leaders proves.
As I recall the EU forced Cyprus to bail out the Greek banks, thus setting in progress the collapse of Laiki bank and the subsequent run on Cyprus banks, resulting in the haircut. Happy to be corrected on this if I'm wrong, but I thought Cyprus had no choice in this??
You are not wrong - Cyprus was granted the bailout monies in exchange for a freeze on individuals bank accounts holding above a certain sum (I thought it was above 60,000 euros but I am prepared to concede Trev's figure is correct). In exchange for this raid the account holders were issued with Greek Bonds (worthless). You may also recall the decision was made when the banks were closed for either a public or bank holiday and remained closed for a whole week. Likewise withdrawals were limited to 100 euros a day from ATMs for quite a time and the amount of money to be taken out of the country was significantly limited. This applied to all Banks. Those who had sold property were obliged to go before some government committee to prove they were not returning to Cyprus in order to secure permission to take the money out of the country and I believe it was still in certain amounts not the whole of the sale price. All this was done at the time of the loan request. If memory serves me correctly Cyprus had just had its elections and the new President went to Brussels for talks with the lady (whose name is escaping me at the moment) regarding the issue but regrettably she declined to move on the matter. Such was the Presidents worry he asked her whether she wished him to resign (it was only weeks after his election). Under his stewardship Cyprus has climbed out of the serious financial position it was in courtesy of the former Communist President. It was most certainly the Troika supported by the EU who made this decision and effectively raided people's bank accounts. Bailout and a Haircut - not certain those involved have received any of their monies back but I doubt it and the state of Greece does not bode well for the people holding the bonds - a complete disgrace.
You may recall that at this particular time it was said the wife of the owner of Orphanides was stopped at the airport when it was discovered her suitcase(s) were crammed with euro banknotes. I am not certain whether this was true or speculation but certainly some people in the know managed to get huge sums of money out of the country by advance information.
trevnhil wrote: ↑Sat Apr 01, 2017 1:58 pmAgreed, Individual citizens Bank accounts had money taken out of them.Trev.
Explained by jeba. Citizens accounts in banks not subject to bankruptcy were unaffected. We were with Hellenic and didn't lose a penny. Correct me if I'm wrong, but only people with more than €100k in BoC were affected? And of course, Laiki.
It didn't affect every bank, but did hit many people and was part of the agreement with the Troika.... I was wrong before.....
The Cypriot banks lent money to Greece and the Greek economy took a nose dive, to compound the problem they then bought Greek Bonds in the hope of bailing out Greece and ended up broke. Nothing to do with the EU, no directives to help Greece from the EU.
I have my doubts whether that is an accurate description of what happened. As far as I remember it wasn´t Germany alone who came up with 13,5 billion (or whatever amount) and deposits of up to €100000 weren´t affected (but thoose above with 30%, not only 9,5). At least that´s what I remember from German media reports at the time (not 100% sure though whether my meory serves me right). Did they really pass a law introducing a new tax?
trevnhil wrote: ↑Sat Apr 01, 2017 1:58 pmAgreed, Individual citizens Bank accounts had money taken out of them.Trev.
Explained by jeba. Citizens accounts in banks not subject to bankruptcy were unaffected. We were with Hellenic and didn't lose a penny. Correct me if I'm wrong, but only people with more than €100k in BoC were affected? And of course, Laiki.
So citizens accounts in banks not subjected to bankruptcy were unaffected but only people with more than €100k in BoC were affected? So some citizens were affected then. Once again HIC with his bottle bottom spectacles.
trevnhil wrote: ↑Sat Apr 01, 2017 1:58 pmAgreed, Individual citizens Bank accounts had money taken out of them.Trev.
Explained by jeba. Citizens accounts in banks not subject to bankruptcy were unaffected. We were with Hellenic and didn't lose a penny. Correct me if I'm wrong, but only people with more than €100k in BoC were affected? And of course, Laiki.
So citizens accounts in banks not subjected to bankruptcy were unaffected but only people with more than €100k in BoC were affected? So some citizens were affected then. Once again HIC with his bottle bottom spectacles.
No, I think BoC customers weren´t affected. Only of 2 banks which were closed down.
Couple of things worth bearing in mind, one minor and one a little more important IMHO
It is indeed technically correct to assert that the EU did not demand Cyprus make the loans to Greece, now written off. There were effectively 3 loans made. One was around 5bn of Greek Government bonds purchased, over the years, entirely voluntarily by the Cyprus banks, the Cyprus Subsidiaries of Greek banks, the Cyprus Central Bank and the Cypriot government as a part of their fiscal planning. It was, in fact, the EU and the ECB, who negotiated with Greece's bondholders to effectively forgive the loans. Some did, some didn't, Cyprus did. You'll have to decide for yourself exactly how much the EU 'influenced' Cyprus' decision. There were two more loans made by Cyprus to Greece, now effectively written off. 110m was loaned directly to Greece after assurances to Cyprus that it would help restrict Cypriot exposure from the ECB [which was a lie] and 220m from the Euro stability mechamism, which wasn't called in by the ECB until Cyprus itself got into trouble. You can argue that these loans were 'lost' because Cyprus is a member of the Eurozone, rather that a member of the EU if you like, the distinction is a little too fine for me.
The more important issue for me was the haircut where, as previous posters have commented, the EU, ECB, and the IMF removed money directly from peoples bank accounts [or technically speaking, the money just ceased to exist]. Here, the EU message was clear.
"If you bank in a Eurozone country, the money in your bank account does not belong to you, it belongs to the state, and you can only have use of it as long as it is convenient to us, and in whatever amounts that are convenient to us."
And if that isn't the scariest thing you have heard, from a supposedly democratic government, then you have lead a much more exciting life than I.
When I tried to read up on Wikipedia I got confused as the English and German versions seem to be contradictory. While I have to stand corrected about the 30% haircut (it was only 9.x%) for deposits beyond €100000 the German Wikipedia says only depositors of the two largest banks were affected (and their shareholders , of course) (..." andererseits betreffen die Maßnahmen auch nicht alle Einleger, sondern nur diejenigen der beiden größten Institute des Landes...." in English: on the other hand those measures don´t affect all depositors, but only those of the two biggest institutes of the country. Source for those with command of German: https://de.wikipedia.org/wiki/Eurokrise ... _Regierung).
Be that as it may, I think it is a bit unfair to blame the EU/ECB/IMF for having confiscated deposits when in fact they merely refused to loan all the 13 or 14 billion needed but "only" gave €10 billion (which after all is more than € 10,000 per capita, babies and centenarians included) and told Cyprus to take the balance from uninsured deposits. The alternative would have been a complete Argentine-sytle bankrupcy (which would have hurt even much more) or having taxpayers of other countries contribute even more.
Hudswell wrote: ↑Sun Apr 02, 2017 7:09 pm
Nope, not unfair at all, perhaps,you can explain the "haircut" as only applied to Cyprus..and not the rest of the PIGS? Citizens lost money...and will not get it back...the EU decided to make Cyprus an example, spin it any way you like...
Yes, the lost money. But it was uninsured money which by definition is at risk if your bank goes bankrupt. Apart from that refusing to bail out a country or bank completely but only doing so partially isn´t the same as being unfair. After all, they were still helping - just not as much as Cyprus wished, but more than € 10,000.- per inhabitant isn´t too shabby, is it? Apart from that it wouldn´t have been popular in other EU countries to bail out banks with substantial deposits of Russian investors with their taxpayer´s money. At least in Germany there is strong resistance against further increases in funding the EU. We already have our own version of UKIP which was founded with the explicit aim of getting out of the Euro. And they already scored double digit shares of the vote in state elections (e. g. in the state of Sachsen-Anhalt they came in second).
