30 votes

Now New Zealand Considers Raiding Depositors' Accounts

Another "small" country tinkers with the idea of a big move to confiscate depositors'
money.

Once indebteded governments get a taste of this practice, the issue won't be will they do it but how much will they take and how often.

Nothing to see here....

http://www.scoop.co.nz/stories/PA1303/S00306/national-planni...
http://rt.com/business/new-zealand-cyprus-style-banking-fail...



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Some context

Firstly, the source for the comments is a Greens MP - which basically means that everything they say is going to be a lie or a truth in the service of a lie. So take everything with a good dose of salt and look for other sources.

Secondly, the government is taking nothing - the bank is required to make good evenly out of savings. This is far less risky than deposit insurance, which basically transforms the credit rating a bank can achieve from its deposits.

Deposit insurance, at least at this end of the world, was never intended to be permanent.

Gas prices jump to...

$3.95 here Indiana! Here in the USA Wall street is Looting us at the PUMP!

Banking is a social disease

Be careful who you transact business with, always practice safe transactions using mutually agreeable forms of specie.

=======
RON PAUL 2012

Amazing how quickly such

a toxic 3rd world banana republic scheme is gaining traction.

Folks in even developed countries reduced to El Banco Cylindrico de Juan Valdez.

You know

the 3rd world banana republic schemes were (are) orchestrated by the same power structure that enslaves "developed" countries, right? We're all in this together, freedom vs. tyranny.

Socialism

Privatize the gains for the ultra wealthy, uber elite, socialize the losses to the little people.

allegory - ˈalɪg(ə)ri/ - noun - 1. a story, poem, or picture which can be interpreted to reveal a hidden meaning, typically a moral or political one.

The losses are already

The losses are already socialized through money printing and bailouts. How do we ever get to free market banking if we cannot make consumers liable for whom they do business with?

Just wait

Bank accounts are one thing. Just wait until they come after all investment accounts, not just money held by banks.

I wonder what they do with CDs

Is there an early confiscation charge?

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bigmikedude's picture

Coming soon to a bank near you!

Rated R

for Racketeering

Rating Agency reaffirms New Zealand banks' ratings

Nothing to worry about as Fitch says there is a high likely hood of a "support" from their parent entities.
http://mobile.reuters.com/article/idUSFit65227620130319?irpc...
------------------------------------
More likely from their depositors

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wouldn't this

cause the New Zealand people to grab their money out of the banks immediately if not sooner?? I would.

Garnet
Daughter of 1776 American Revolutionists

I dont see why anyone would risk it

But they are told there is deposit insurance
Just like there is in Cyrpus!

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This plan would eliminate

This plan would eliminate deposit insurance. People would have the obligation of knowing who they are doing their banking with or risk losing their deposits with a bank that makes risky moves.

This forces people to look into what their bank is doing with their money, and it forces banks to be open with customers and introduce their money to less risk.

I see this as a huge step toward free market banking.

Why can't others see this? Do I need to find some Rothbard or Paul quote about moral hazard? This plan eliminates the moral hazard of deposit insurance.

No it eliminates property rights if the govt

Can just confiscate
You are correct an abusive government system may collapse or be thrown off
and replaced with a free market system but the government confiscation itself is not a free market solution

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The government isn't

The government isn't confiscating it. The bank in this scenario already lost the money, the government is just saying that the bank has to take an equal percentage off of everyone's account in the amount of the loss.

This is exactly how a free market collapse would occur except that the bank would likely "lose" all of the depositors money.

Basically, you as a depositor have to hold your bank accountable and vote with your feet if you don't like what they do, because if they fail it's your money on the line.

What is your solution? More fake insurance guarantees?

Rothschild owns all the central banks in the world.

Iran, Cuba, and N KOREA are the only nations not yet owned by Rothschild central bankers and the three are under heavy sanctions.

“Depositors will overnight have their savings shaved by the amount needed to keep the bank afloat."

Are we so controlled and brainwashed as to allow this? No one has a right to rob us of the fruits of our labor. I hope there is a global reaction that says NO WAY.

-1

"depositors" not "deposotors"

Come on you're making us look bad. Pick it up a notch will ya?

a simple correction would

a simple correction would have been fine.

Fixed

Thanks

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cant belive i just wasted

cant belive i just wasted 5-10 seconds of my life having to read about and now comment on a spelling error on a very important topic. Lighten the hell up, this isnt english class.

Actually, this is closer to a free-market solution

Actually, this is closer to a free-market solution to bank failure than anything else.

This forum is dedicated to free market principles. Ron Paul is a firm believer in free markets and not faux government guarantees like FDIC deposit insurance.

If New Zealand can't get rid of deposit guarantees and move toward more free market banking solutions, then what should be done? Should they keep pretending that deposit insurance and bank bailouts are going to save the fractured economic system? Or should they make banks be responsible to their customers and customers responsible for holding their banks to account?

Yep and my freemarket money wont be invested in such risky banks

Yep and my freemarket money wont be invested in such risky banks.

In the absence of something like FDIC I would much rather a haircut then a MF global type deal. But without depositor/bank insurance I'm sure the banks would NEVER make such risky loans or my money wouldn't be there.

Tools of war are not always obvious. The worst weapon is an idea planted in the mind of man. Prejudices can kill, suspicion can destroy, and a thoughtless, frightened search for a scapegoat has an everlasting fallout all of its own.

Its not a free market solution for the government to steal

Money from depositors
It may lead to free market principles as people wise up and rely less on the govt and more on their own die diligence
However the people may never get a chance if the govt takes all their money first!

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The government isn't taking

The government isn't taking their money. Read the article.

The way it would work in New Zealand is that they wouldn't have deposit insurance. If a bank fails, you lose whatever percentage of your deposits is required to make the bank stable, i.e. make good on whatever promises are left.

This is exactly how free banking would work. The government isn't stealing anything in this situation. All the government is doing is prescribing an orderly bank failure and not making fake guarantees.

Yes,but they are because first they offered the insurance

and the depositors relied on it, then they took it away.
Ron Paul makes the point re social security-he wants to eliminate it but he realizes the government offered it to the people and to take it away from them would be a breach of contract with out remedy-hence theft.

I think we both agree the government should not be in the business of guaranteeing the bank deposits BUT once they undertake that responsibility then have to abide by it.

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If I understand you

If I understand you correctly, you are implying that there is no legitimate way to end deposit insurance, because it wouldn't be fair to do so?

How then do we arrive at free market banking in the future?

It can be phased out

They can announce - not over night - the removal of the insurance and give current depositors the chance to asses and to put new depositors on notice
Then a free market could emerge as competing banks could tout their solvency to gain customers

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