Comment: The actions taken by Cyprus

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The actions taken by Cyprus

The actions taken by Cyprus were largely forced by the "Troika" (EC, ECB, IMF) authorities as a condition of providing bailout funds to Cyprus. Many believe, and I agree, that this was a EU test case, and that "solutions" such as this are possibilities for other over extended EU nations. If I had money in an EU country's bank, especially if it were in a bank in one if the PIGS countries, and especially if the amount were greater than the insured €100K, I'd have already pulled out my money.

Should depositors in US banks be worried? Some point out the difference between the EU and US financial system and political structures and suggest that it could never happen here. I'm not so sure. I can think of a coupe of events that could trigger similar actions here.

One would be a state going bust. Like Cyprus, a US state can't print it's way out of trouble, and I can easily imagine the US govt and Fed forcing a bust state to raise taxes on it's citizens as a condition of any bailout. One way to raise taxes would be a one time confiscation from the wealthy.

The other scenario is the dollar being threatened. The present US govt and the bankster elite essentially have death grips on one another. One can't exist without the other. When there comes a time that the Fed can no longer bailout the US govt's deficit spending we WILL see large scale wealth confiscation, of this I have no doubt. Wealth confiscations will be necessary to prevent riots. How that confiscation takes place is anybody's guess, but siezing of bank accounts would likely be one of the first moves.

Never trouble trouble til trouble troubles you. Fortune Cookie