Making It Up As They Go Along

Back to Cyprus, and ZeroHedge has a disturbing story:

From Reuters:

While ordinary Cypriots queued at ATM machines to withdraw a few hundred euros as credit card transactions stopped, other depositors used an array of techniques to access their money.

No one knows exactly how much money has left Cyprus’ banks, or where it has gone. The two banks at the centre of the crisis – Cyprus Popular Bank, also known as Laiki, and Bank of Cyprus – have units in London which remained open throughout the week and placed no limits on withdrawals. Bank of Cyprus also owns 80 percent of Russia’s Uniastrum Bank, which put no restrictions on withdrawals in Russia. Russians were among Cypriot banks’ largest depositors.

So while one could not withdraw from Bank of Cyprus or Laiki, one could withdraw without limitations from subsidiary and OpCo banks, and other affiliates?

Just brilliant.

I was wondering why Russia hadn’t kicked up a big fuss, and threatened to cut off gas supplies to Europe at the height of the current big freeze. Now I see why. They had other ways of pulling the money out of Cypriot banks.

Since insured depositors with less than €100,000 in Cypriot banks are now to be protected (which they weren’t a week ago), it would appear that the main losers will be wealthy Cypriots and any other depositors who had the misfortune of not living in Britain or Russia when the banks closed.

But are European depositors safe now? Yesterday the Telegraph reported:

The euro fell on global markets after Jeroen Dijsselbloem, the Dutch chairman of the eurozone, told the FT and Reuters that the heavy losses inflicted on depositors in Cyprus would be the template for future banking crises across Europe.

“If there is a risk in a bank, our first question should be ‘Okay, what are you in the bank going to do about that? What can you do to recapitalise yourself?’,” he said.

“If the bank can’t do it, then we’ll talk to the shareholders and the bondholders, we’ll ask them to contribute in recapitalising the bank, and if necessary the uninsured deposit holders.”

Ditching a three-year-old policy of protecting senior bondholders and large depositors, over €100,000, in banks, Mr Dijsselbloem argued that the lack of market contagion surrounding Cyprus showed that private investors could now be hit to pay for bad banking debts

However, having said that yesterday, he backtracked today and said that Cyprus was a “special case”.

And today the Portuguese finance minister said the same, only to also promptly retract his remarks.

They’re just making the rules up as they go along. And if you didn’t think they could do that, then stand corrected by Britain’s Chancellor:

Mr Osborne also said he didn’t question the legality of the capital controls, since Article 63 of Europe’s internal market rules can be bent in an emergency.

No wonder the EU enjoys having all these numerous emergencies: it gives them the opportunity to ‘bend the rules’. In fact, as far as I can see, they bend the rules any time they want to. In the circumstances, it’s not surprising that depositors are getting nervous:

16.01 There is anecdotal evidence that British ex-pats in the eurozone periphery are nervous about their deposits in Mediterranean banks. Financial advisory firm deVere Group say they’ve experienced a “surge” in inquiries on moving funds elsewhere. Nigel Green, chief executive, said:

Over the last week, since the messy deal to bailout Cypriot banks began, our financial advisers in these areas [Spain, Italy, Portugal and Greece] have reported a significant surge in enquiries from expats who are looking to safeguard their funds in other jurisdictions which are perceived to be safer.

Whether the institutions like it and accept it or not, there is a real risk of a major deposit flight from these countries as people feel their accounts could be plundered next.

ZeroHedge seemed to think the whole point of the Cyprus bank heist had been to loot the accounts of a few Russian oligarchs. But I think the EU is simply doing everything it can to hold the eurozone together, and keep member states inside the EU. It’s their political project, and they’ll do whatever they have to to keep it together, including robbing people’s bank accounts if necessary. And they definitely don’t want anyone doing what Paul Krugman advises:

Cyprus should leave the euro. Now.

The reason is straightforward: staying in the euro means an incredibly severe depression, which will last for many years while Cyprus tries to build a new export sector. Leaving the euro, and letting the new currency fall sharply, would greatly accelerate that rebuilding.

If you look at Cyprus’s trade profile, you see just how much damage the country is about to sustain. This is a highly open economy with just two major exports, banking services and tourism — and one of them just disappeared. This would lead to a severe slump on its own. On top of that, the troika is demanding major new austerity, even though the country supposedly has rough primary (non-interest) budget balance. I wouldn’t be surprised to see a 20 percent fall in real GDP.

It’s not just Cyprus, in my view. Everyone should get out of this utopian political pipedream. The longer they stay in, the worse the damage will be.

About Frank Davis

This entry was posted in Uncategorized and tagged , , . Bookmark the permalink.

24 Responses to Making It Up As They Go Along

  1. wobbler2012 says:

    We all know that the EU project was doomed to failure but many of these smaller countries shouldn’t even have joined the EU, most of the blame for this robbery should rightly lay with the EU but some blame has surely got to be attached to the Cypriot government at the time that they went into the Euro.

    It was like a large bring a bottle party and Cyprus turned up with a Tesco’s value lager 4-pack.

  2. jaxthefirst says:

    I remain totally baffled as to why UK politicians aren’t (apparently) panicking more than they seem to be, given that although we aren’t in the Euro, our association with the EU and the Eurozone must surely be an enormous risk to our own financial services industry – one, if not the, most profitable of our exports. With everyone associated with this mess, as you rightly point out, quite clearly now rushing about like chickens with their heads cut off, desperate to keep the EU together but with clearly a fast-diminishing number of measures to do so, the EU reminds me now of a very, very, very fragile house of cards, which would need just the slightest movement of one of the bottom cards for the whole thing to come tumbling down in one fell swoop. We should make that move, and we should make it now, if only to protect that one vital sector of our economy which is still worth something (just). For sure, there’d be utter chaos and the Eurocrats would be furious but ultimately we’d be doing all of the countries in Europe a favour by giving them a chance to re-build economies which have either been ruined by the machinations of the EU (like ours) or falsely shored up by it, like the Eastern European members who, like Ireland, are simply going to suffer a major fall when the funding is inevitably withdrawn when the next group of even poorer countries joins the EU club (Africa, anyone?).

    It would even work personally to the benefit of the likes of Cameron and Clegg and Co (bearing in mind that their own personal careers are pretty much all that they care about these days) because the disintegration of the EU edifice would automatically give them back the power to run their own country as they see fit – to actually be the Prime Minister and the Deputy Prime Minister – rather than simply doing the bidding of their EU masters at every turn. I’m staggered, to be honest, that they aren’t jumping at this opportunity, now that the EU looks pretty much doomed as a political experiment (and thus, as an ex-politican’s gravy train) one way or the other. When collapse is imminent, isn’t a controlled demolition usually regarded as a better alternative than waiting for time and a strong wind to blow an unstable structure over at random??

    • DrDan H. says:

      Cyprus was in the business of being a Eurozone tax haven, first and foremost. Germany hates tax havens, because they screw up the maths of running an economy; the Germanic economies run best if the proles cannot escape being taxed. Cyprus threw a spanner in the works of that assumption, so under the blinkered Germanic world-view, it had to go. Diddling the Russians was never really the game plan, indeed since the Russian mafia and government are pretty much indistinguishable and have a shared interest in discouraging theft of their money, and disrespect of the Russian image (see also: Litvinenko), such a widespread diddling would have been extremely unhealthy for the EU’s officials.

      So, the Russians were allowed their little loophole for the better-connected to get wind of the heist by and rescue their money through, but the rest of the tax haven users got scalped and the haven shut down. To the Germanic EU thinkers, this is a win.

      To everyone else with a functioning brain, this was a fail writ large. Legalised theft makes investors nervous, even when it seems just to have been a housekeeping exercise to remove a nasty little tax haven. The Cyprus theft will certainly come back to haunt the EU.

  3. melinoerealm says:

    “Worringly for the European Union, almost three in ten Swedes think that their country should consider leaving the EU if the ban goes ahead.
    …In December of last year, EU Health Commissioner Tonio Borg told a Brussels press conference, “We are not banning smoking, we are making it less attractive.”

    Responding to the broader points of the EU directives involved in banning snus and making cigarettes “less attrative, Patrik Hildingsson of tobacco giant Swedish Match said, “We regret that the current ban on snus exports is going to remain in place.

    “The Commission is picking winners and losers in the market,” he said, calling the extension of the snus export ban a “one-sided trade ban”.
    “Other snus manufacturers in Europe are able to export to Sweden, but we can’t export to the rest of Europe,” said Hildingsson.

    The news comes as industries and campaigners continue to express concerns over the EU’s indiscriminate approach to tobacco or nicotine-based products. Recently it was reported that the EU is considering a ban of sorts on electronic cigarettes, a move that campaigners have called, “madness” given the products’ ability to ween people off actual cigarettes. ”

    • melinoerealm says:

      PS: Swedish manufacturers are able to export liquor in the rest of Europe, but no one can sell liquor in Sweden, which is holding a state monopoly on liquor.
      And same goes for Finland…

  4. legiron says:

    It was amusing to watch the Eu-crats crow that they could now rob any EU bank account whenever they felt like it, only to retract their words hours later.

    Bank transfers can be done in two hours now. I wonder how many occurred between their crowing, and their eating crow? It’s unlikely to ever be reported.

    Foreign (non-EU) investment in the Eurozone is over. The EU have stated they will steal it and made a law to allow them to do it. You might as well put all your savings into Banco Mafioso and expect to get a penny back.

  5. Henry Crun says:

    I don’t know much, but I know enough to not steal money off Russian “businessmen”

    If I was a Eurocrat, I’d be afraid right now. Very afraid.

  6. jaxthefirst says:

    “If I was a Eurocrat, I’d be afraid right now. Very afraid.”

    Amazingly, Henry, they never are. I think that they honestly now believe that they are untouchable, which is why they behave as they do, and why they come up with daft ideas like stealing people’s own money and then have the gall to trumpet the fact that that’s what they intend to do to all and sundry. Maybe a few private visits by some Russian businessmens’ “representatives” might change their attitudes …

    Crumbs, it’s like WWII all over again – looking to the Russians at the last knockings to put the once-and-for-all final nail in the coffin of a fast-failing regime. Who’d have thought it??

    • Frank Davis says:

      Well, they’ve all got immunity from prosecution, to the best of my knowledge. It seems to be part of the package deal you get when you join the Eurocracy. Although I did notice that French police were searching the flat of the IMF’s Christine Lagarde last week in connection with past dodgy dealings of hers – so maybe she’s only partially immune.

  7. harleyrider1978 says:

    When you can openly and legally steal depositors money it is indeed over. I havent heard any mention of EURO confidence levels in the currency of late. Anyone who leaves money in any bank now is more than likely a fool. If they can do it there,they can do it ANYWHERE.

  8. Frank Davis says:


    A Furious Cyprus Begins Investigating Who Breached The Capital Controls
    Submitted by Tyler Durden on 03/27/2013 – 08:20
    On Monday we reported the very disturbing news that despite the ongoing liquidity blockade, capital controls and (somewhat) closed Cyprus banks, one particular group of people – the very same group targeted to prompt this whole ludicrous collapse of the island nation – Russian Oligrachs had found ways to bypass the ringfence and pull their money out quickly and quietly. We said that, if confirmed, “If we were Cypriots at this point we would be angry. Very, very angry.” Turns out the Cypriots did become angry, and the questions are finally starting. As Spiegel reports, the Cypriot Parliament, which may or may not last too long once the banks reopen tomorrow and the people realize that in a fractional reserve banking system, those deposits you thought were there… they are gone, poof, has begun investigating the capital flight that may means the destruction of Cyprus has been for nothing. Sadly, it is now too little, too late.

    • Frank Davis says:

      The Slog says:

      Then this morning the 20%-40% seizure of the depositor’s money, which was the range that had been discussed, was revealed by the Finance Minister Michael Sarris in Cyprus to be more like an 80% expropriation and a timeline to get any money back of six to eight years. For which read, “100% and never”.

      His commenters don’t seem disagree.

  9. harleyrider1978 says:

    Tobacco Control training course where anyone can be made a NAZI

    Assignment Tips

    Tips for Writing a Letter to the Editor

    Be Brief: Most newspapers will not run letters to the editor longer than 250 words! The Globe and Mail for example has a 200 word maximum. For the purpose of this assignment, however, the LETTER TO THE EDITOR should NOT EXCEED 250 words. Keep letters short and to the point. State your position clearly. Stick to ONE SUBJECT.
    Don’t Get Personal: It’s okay to express anger or outrage, but keep it focused on specific policies or ideas. Personal attacks are a sure way to sink publication of your letter. They can also set up for libel or loss of credibility.
    Find a Local Angle: If you are writing about a statewide or national issue, explain how it connects to your local river or stream. Readers want to know how an issue affects their lives and their communities.
    Explain Yourself: Don’t assume readers are as familiar with an issue as you are. Give a short but informative background before tackling the main issue.
    Avoid Form Letters: Sample letters to the editor are just that – samples. Use them only as a guide in writing your own letter: don’t ever submit them verbatim to the newspaper. Also, avoid submitting the same letter to two competing newspapers.
    Know the Rules: Most newspapers have strict guidelines for what sorts of letters to the editor they will publish. Some require a typed letter; others may want it sent by e-mail. Almost all will want your real name (not a pseudonym), address and phone number so they can verify you are really the author. Many newspapers will only print a letter to the editor by any individual once per month. Check your newspaper’s guideline on its letters page or its website.
    Be Timely: Newspapers rarely publish letters that are unrelated to topics being covered in the news. Make sure your letter to the editor focuses on something that is happening now, or has happened within the last few weeks.


    Tips For Writing Abstracts
    Make the Abstract Easy to Read

    Avoid jargon
    Use active verbs rather than passive verbs
    Use short sentences but vary sentence structure so that the abstract doesn’t sound choppy
    Use complete sentences
    Unless the abstract is very short (100-125 words), divide it into several paragraphs

    Be Concise; Give Information Only Once
    Follow the Rules Laid Out by the Specific Scientific Meeting

    (You will be asked to “submit” to the Society for Research on Nicotine and Tobacco). Include:

    An introductory paragraph stating the purpose of your work and research question(s)
    A paragraph with basic information on the methods you used to address your research question(s)
    A paragraph describing your key results
    A concluding paragraph outlining what you have learned from your research and the significance of the findings


    Tips on Persuasive Speech
    The Motivated Sequence

    Attention: Gain the attention of the audience and focus them on the main ideas of the speech
    Need: Define your general problem and relate it to the needs of the audience. The audience must understand the need for change. Then illustrate the need by using examples, evidence, testimony, and statistics. Relate these to the needs, interests, and values of the audience.
    Satisfaction: Provide a solution to the problem. Do this by offering the following details:
    The solution states how your action will meet the need discussed earlier
    Your comprehensive plan
    Demonstrate how your solution will work
    Use strong evidence and supporting material
    Raise objections you might anticipate and overcome the objections
    Visualization: Increase the desire for you proposed solution by using vivid descriptions to paint pictures through the use of imagery. Show how the audience will benefit from your plan, how the future will look, how they will profit from a policy, or how an altered belief ill bring about a positive result.
    Action: Every persuasive speech should end with a call o action. You have created a desire, now tell the audience what you want them to do. Use a direct appeal to achieve the desired action. Conclude on a strong note that convinces the audience to act based on the soundness of your proposal.

    Structure of a Speech to Convince

    Present a history of the problem. Discuss the events that preceded the problem and outline the importance of the topic.
    Discuss the effects of the problem at the present time. Give illustrations, evidence, facts, proof, and examples to support your claims.
    List the causes that brought about the effects. Use supporting evidence.
    List possible solutions to solve your problem. Present alternatives and use supporting evidence.
    Present your solution to the problem. Offer the evidence and the reasons for choosing the solution or promoting a particular belief or idea.
    Show how the audience will benefit from your proposal. For example, they will get a better education; increase their profits; obtain better access for the disabled.
    Conclude your speech with a final statement supporting your solution/proposal. What action would you like the audience to take?


    Suggestions for Poster Presentations

    Be sure to make the poster presentation easy for the reader to follow. Do not put too much written information on the poster, and avoid putting tables and/or figures that are difficult to interpret.

    Use a program such as Microsoft Powerpoint® to create the poster. This will be easier and more visually appealing than combining separate pages produced by word processing software or attaching papers to poster board.

    One of the simplest arrangements for a poster in landscape orientation with individual poster elements in portrait orientation. When using Microsoft Powerpoint, under page setup command, change the dimensions of a slide to the desired poster size (e.g., 32” x 40″). Then you can begin to add information to the slide. When printed, the slide will become a poster with the dimensions you have designated.

    A poster presentation should follow the same format as an oral presentation. There is normally:

    a Title describing the title of the project, the people involved in the work and their affiliation.
    a Summary of the project stating what you have set out to do, how you have done it, the key findings and the main results.
    an Introduction that should include clear statements about the problem that you are trying to solve, the characteristics that you are trying to discover or the proofs that you are trying to establish. These should then lead to declarations of project aims and objectives.
    a Methodology section that explains the analytical approach used in your study. You should also state and justify any assumptions, so that your results could be viewed in the proper context.
    a Results section that you use to illustrate the main results of the work via tables and/or figures. a Conclusion section, listing the main findings of your investigation, and
    a Further Work section that should contain your recommendations and thoughts about how the work could be progressed, other tests that could be applied, etc.

    Given that you have limited space in a poster, you now have to decide between what is important and what is not necessary. Your decision should be based on at least 2 factors, namely:

    What are you trying to achieve by presenting the poster? Is it to tell people what you have done? Is it to tell people of a new discovery? Is it to create awareness of a problem?
    Who will be attending the presentation? Are they technical people? What is the level of their knowledge of your subject area?

    The answers to these questions define the type of content to include and set the tone of the presentation.

    Once you decide what is necessary to include in the poster, move on to the next steps of actually creating the poster. Some other things to consider when creating a poster are:

    Keep the material simple
    make full use of the space, but do not cramp the poster full of information as the result can often appear messy.
    be concise and do not waffle. Use only pertinent information to convey your message.
    be selective when showing results. Present only those that illustrate the main findings of the project.
    Use colours sparingly and with taste
    colours should be used only to emphasise, differentiate and to add interest. Do not use colours just to impress!
    try to avoid using large swathes of bright garish colours like bright green, pink, orange or lilac.
    choose background and foreground colour combinations that have high contrast and complement each other.
    Do not use more than 2 font types
    too many font types distracts, especially when they appear on the same sentence.
    Titles and headings should appear larger than other text, but not too large. The text should also be legible from a distance, say from 1.5m to 2m.
    Do not use all UPPER CASE type in your posters. It can make the material difficult to read.
    Do not use a different font type to highlight important points
    otherwise the fluency and flow of your sentence can appear disrupted. For example, use underlined text, the bold face or italics or combinations to emphasise words and phrases.
    if you use bold italicised print for emphasis, then underlining is not necessary – overkill!
    should be kept to a minimum.
    present only the necessary and important equations.
    should be large enough.
    should be accompanied by nomenclature to explain the significance of each variable
    A picture is worth a thousand words … (but only if it is used appropriately)
    choose graph types that are appropriate to the information that you want to display.
    annotations should be large enough, and the lines of line-graphs should be thick enough so that they may be viewed from a distance.
    instead of using lines of different thickness, use contrasting coloured lines or different line styles to distinguish between different lines in multi-line graphs.
    multi-line plots or plots with more than one variable should have a legend relating the plotted variable to the colour or style of the line.
    Diagrams and drawings
    should be labelled
    drawings and labels should be large and clear enough so that they are still legible from a distance
    do not try to cramp labelling to fit into components of a drawing or diagram. Use ‘arrows’ and ‘callouts’
    should only be used if they add interest to the display and complement the subject matter. Otherwise, all they do is to distract attention from the focus of the presentation.
    Check your spelling
    there is nothing more amusing or annoying than spelling mistakes on public display, especially if they are on the title.
    spelling mistakes give the impression that you have not put in the effort; careless; not bothered; not worthy of high assessment scores.
    Maintain a consistent style
    inconsistent styles give the impression of disharmony and can interrupt the fluency and flow of your messages.
    graphs should be of the same size and scale especially if they are to be compared.
    captions for graphs, drawings and tables should either be positioned at the top or at the bottom of the figure.
    Review, review and review
    make draft versions of your poster sections and check them for mistakes, legibility and inconsistency in style.
    try different layout arrangements.
    ask your partner, friends, colleagues or supervisor for their ‘honest’ opinions.
    be critical

    Selections taken from: Dept. of Chemical and Process Engineering, University of Newcastle

  10. harleyrider1978 says:

    (Reuters) – Cyprus is expected to stop people taking their money out of the country but will not restrict dealings at home as it tries to avert a run on its banks after agreeing a tough rescue package with international lenders.

  11. harleyrider1978 says:

    Bankrupt Jersey Casino To Lift Smoking Ban

    Most Expensive Property Ever Built There Will Change Some Things

    by Brian Pempus | Published: Mar 27, 2013 | E-mail Author

    • harleyrider1978 says:

      Not a word of it thru official channels at all! They snuck it in under part of its bankruptcy turn around to profitability plan!!!!!! ROFLMAO

No need to log in

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.