Russia today reported that the Cypriot Parliament vote on the depositor banking haircut had been delayed until Monday as the banking cartel was 33% short of the necessary votes needed to pass the bail-in/ wealth confiscation.
In a desperate attempt to appease Cypriots and pass the measure Monday, RT reports that the IMF is discussing reducing the wealth confiscation for deposits under €100,000 to 3%, and compensating by raising the tax to approximately 13% on larger accounts (i.e. wealthy foreign Russian oligarchs).
yprus is currently deciding whether to raise the anti-crisis tax on savings larger than €100,000 to 12.5%, while reducing the levy on smaller amounts to 3 per cent, a source told Reuters.
The Cypriot government has been discussing with its European creditors the idea of reducing the levy on deposits smaller than €100,000 to 3 per cent, Reuters reported citing an anonymous source who is close to talks.
To counterbalance the measure, the government proposed to increase the tax on large sums to 12.5 per cent from the originally proposed 9.9, the source said.
The last minute discussions are allegedly aimed at appeasing ordinary Cypriots who are about to share a major part of the anti-crisis burden imposed on Cyprus by the European Central Bank.
Notice that Cypriot bank funds have been frozen prior to any deal actually being agreed to by the Cypriot Parliament:
A meeting of the Cyprus parliament had been scheduled for Sunday but was postponed for at least a day in order to try and broker a deal between the parties, political sources are saying. The vote on the measure is now expected on Monday.
At the same time authorities have extended for another day Monday’s bank holiday, so the levy is unlikely to come in force on Tuesday morning as was initially planned.
There really is nothing to worry about for those with their cash in the Cypriot banking system, President Anastasiades states that those who keep their entire deposits in Cypriot banks will get half of their confiscated funds back in worthless bank bonds:
On Sunday, the Cypriot president addressed the nation claiming that this new tough decision was the only available measure to avoid default and subsequent separation from the EU.
“Those who hold on to their deposits for two years, will get back half of their deposit in bonds,” Nicos Anastasiades said, trying to avert an imminent wave of deposit withdrawals after the holidays.
The president promised that the bonds will be secured by the revenues in the gas field and promised that pension and provident funds will remain untouched by this one-time measure.
So Anastasiades is promising that pension and provident funds will remain untouched by the government. Just like they promised depositor haircuts would be completely off-limits. Until it happened.
EU STEALS HITLERS MONEY HITLER IS FURIOUS
Russian “Black Money” Threatens To Boot Cyprus Out Of The Eurozone
Cyprus is in horrid shape. Particularly its banks. Their €152 billion in “assets” are 8.5 times the country’s GDP of €17.8 billion. “Assets” in quotation marks because some have dissipated and because €23 billion in loans, or 27% of the banks’ entire credit portfolio, are nonperforming. That’s 127% of GDP! And then there are the Russian-owned “black-money” accounts.
A “secret” report by the German version of the CIA, the Bundesnachrichtendienst (BND) was leaked last November, revealing that any bailout of Cyprus would benefit rich Russians and their €26 billion in “black money” that they deposited in the now collapsing banks. The report accuses Cyprus of creating ideal conditions for large-scale money laundering, including handing out Cypriot passports to Russian oligarchs, giving them the option to settle in the EU. Much of this laundered money then reverses direction, turning minuscule Cyprus into Russia’s largest foreign investor [read… The Bailout of Russian “Black Money” in Cyprus].
Now Cyprus needs €17.5 billion—just about 100% of its GDP—of which €12 billion would go directly to the murky and putrid banks. The package should be wrapped up and signed on February 10 at the meeting of the European finance ministers.
“I cannot imagine that the German taxpayer will save Cypriot banks whose business model is to abet tax fraud,”grumbled Sigmar Gabriel, chairman of the opposition SPD that has been a supporter of euro bailouts; and Merkel, hobbled by opposition within her own coalition, had relied on them to get prior bailouts passed. “If Mrs. Merkel wants to have the approval of the SPD, she must have very good reasons,” he said. “But I don’t see any….”
The Greens are resisting the Cyprus bailout for the same reasons. And 20 members of Merkel’s own coalition are categorically opposed to it. For the first time, Merkel has no majority to get a bailout package passed. The opposition smells an election advantage.
Before the German finance minister can vote in the Euro Group of finance ministers for disbursement of bailout funds, he must seek parliamentary approval. The German Constitutional Court said so, inconveniently. But without his yes-vote, which weighs 29%, the qualified majority of 73.9% cannot be reached. The bailout disbursement crashes. That’s what Cyprus is contemplating.
Fearing defeat, sources within the government now made it known that they wouldn’t even present a bailout package unless Cyprus agreed to “radical reforms,” including massive privatizations of the bloated state sector—precisely what communist President Dimitris Christofias has ruled out.
The Russian “black money” is so unpalatable that even the bailout-happy President of the EU Parliament, Martin Schulz, got cold feet. Before a bailout package could be put together, he said, “it must be disclosed where the money in Cyprus is coming from.”
Markus Ferber, head of Merkel’s coalition partner CSU, demanded a guarantee that “we help the citizens of Cyprus and not the Russian oligarchs.” In addition, he wants Cyprus to reform its naturalization law. If Cyprus wants to get bailed out, he mused, it must make sure “that not everyone who has a lot of money can get a Cypriot passport.”
Foreign Minister Guido Westerwelle (FDP), who is no Eurosceptic, hammered home that the Cyprus won’t get special treatment. The European community is “ready for solidarity, but only in return for real structural reforms,” he said. “Greece didn’t get a blank check, Cyprus won’t either.” And those reforms included “banking transparence.” They’re all out there now, griping about German taxpayers bailing out Russian “black money.” zero hedge
On Friday before Christmas when nobody was paying attention, when people were elbowing their way through department stores or heading out for vacation, the European Commission issued its report on bank bailouts in the European Union—a dry document with mind-boggling numbers that left out the most important fact.
The misnamed “2012 State Aid Scoreboard“ provided a sobering number—misnamedbecause it covered the period from October 2008 through December 2011, and not 2012. It had taken the Commission bureaucracy a year to add up all the numbers, and there were a lot of them to add up. Turns out, the amount that the governments of all 27 EU states had handed to their banks to prop them up or bail them out amounted to €1.616 trillion ($2.1 trillion).
It does not include the bank bailouts of 2012, such as Spain, whose banks are getting their first installment of €39 billion, or Greece [The Price Of “Collective Trauma”: Greece At The Brink of Civil War], or tiny Cyprus whose banks alone require at least €10 billion [The Bailout Of Russian “Black Money” In Cyprus]. Nor does it include any of the ECB’s bailout operations.