Americans who have saved over the years and put away a nest egg may be looking at losing a great deal of it. Impossible? It just happened in Cyprus.
From the Daily Mail:
“Up to 60,000 British savers are to lose thousands of pounds each after European finance chiefs ordered an unprecedented raid on personal bank accounts.
“Expats and UK troops based in Cyprus will have their savings decimated as part of a painful bid to bail out the bankrupt island.
“Britons have about £1.7 billion of deposits in Cyprus and could lose up to £170 million.
“The Cypriot government has agreed to seize up to ten per cent of savings and use the money to bail out the island’s crisis-hit banking system.
“The move sparked panic and violent protests yesterday as crowds desperately tried to withdraw their money at cash machines.
“Restrictions have been imposed to stop people emptying their accounts or moving their money out of the country following the deal with other eurozone finance ministers, under which ordinary citizens’ deposits will be directly raided for the first time.
“One furious expat said: ‘This is plain theft. I’d love to hear someone explain to me why it isn’t.’
“And one of the 3,000 British service personnel based on the island said: ‘I stand to lose €4,000 [£3,500] We’ve tried to save quite hard while we are here – that’s been thrown back in our faces.’
“Cypriot president Nicos Anastasiades, who agreed to the raid following ten-hour talks with European finance chiefs, said it was necessary because Cyprus was in a ‘state of emergency’ and failure to enact the Brussels plan would be ‘catastrophic’.
“Under the deal, all bank deposits over €100,000 will be hit with a levy of 9.9 per cent. Those with smaller savings will pay 6.75 per cent.
“The European Central Bank said Britons have £1.7 billion deposited on the island.
“British expats were stunned by the news, with many left high and dry by the restrictions on accounts.
“Cash machines had been working, but many ran out of notes because of the panic withdrawals. Tomorrow is a public holiday in Cyprus, too, so savers will have to wait until Tuesday until they can access their money.
“Andy Georgiou, 32, who grew up in Liverpool, said: ‘We are struggling. We can’t access money and we need it to buy petrol and food. It’s appalling. All without any warning.’
“Sean Chamberlain, a 39-year-old writer from Devon who now lives in Cyprus, said: ‘There are a lot of people who are very angry. Everyone was furious, feeling absolutely betrayed by yet another apparently incompetent government.
“‘And now they’ve done it once, what’s to stop them deciding to do it again next week? If there’s a run on the bank, that’s a terrifying thing.’
“Shirley Brooks, 61, originally from Manchester, stands to lose €18,600. She said: ‘I am extremely angry. This is our retirement money, and there was no warning that this was coming. I don’t think we should have to pay anything as we did not cause the problems in the economy.’”
Is this in our future?
ZeroHedge writes, “These same people may be even more shocked to learn that today’s Cypriot “resolution” is merely the first of many such coercive interventions into personal wealth, first in Europe, and then everywhere else…
coercive wealth tax is merely the beginning for a world in which there was some $21 trillion in excess debt as of 2009, a number which has since ballooned to over $30 trillion. And with inflation woefully late in appearing and “inflating away” said debt overhang, Europe first is finally moving to Plan B, and is using Cyprus as its Guinea Pig.”
Don’t think it couldn’t happen here; that “this is America!” Yes, but this is America under Barack H. Obama and it can happen here.