banking system

Good news ! (?)

Swiss citizens’ initiative collects 105,000 signatures, triggers referendum on Money Creation

The Swiss population will be the first in the world to vote on their banking and monetary system, thanks to the tireless efforts of a pro-Sovereign Money campaign.

The “Vollgeld Initiative” (Sovereign Money Initiative) has successfully managed to collect 100,000 signatures –  the number required to trigger a nationwide referendum on the issue. (more…)

Greek banks are proven to be near death. Greek people will follow this pattern closely.

Οι εγχώριες τράπεζες αποδείχθηκαν ετοιμοθάνατες. Ακολουθεί ο λαός μας.

by S. Katsoulis*

I’m sure you know by now. The hard working people at the ECB led by it’s VP Vítor Constâncio, kept themselves busy throughout the weekend  of 25-26 October (hopefully they did charge the appropriate overtime) in order to complete the much needed stress tests for the Greek banks and also the rest of the E.U.’s banks.
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First impressions
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The first obvious observation that someone could make is the fantastic technical expertise that was used to cook up the numbers in the 172 page document [1]. The second thing that can be observed is the top positions that 2 of out indigenous banks have acquired, given that they are sitting at the first and third positions in the list of mentioned banks. A little lower, at position 14 we can spot the third Greek bank, which means that 3 our of four Greek banks are having some issues… (more…)

Dimitris Kazakis – Cass Business School – April 11th 2013

Dimitris Kazakis addresses EPAM London – Greece must leave the Euro and the EU

Introduction by Tim Congdon, CBE
This is the English language version with the words of Dimitris Kazakis interpreted by Anthony Ragusis of EPAM London

 

Two of Greece’s biggest banks face nationalization after failing to attract private investment and a surprise move by the state to suspend their merger deal.

A man comes out of an Eurobank branch in central Athens October 5, 2012. REUTERS/John Kolesidis

By George Georgiopoulos
ATHENS | Mon Apr 8, 2013 7:27am

Shares of Greek lenders National Bank (NBGr.AT) and rival Eurobank (EFGr.AT) plunged by as much as 30 percent on Monday after they confirmed their merger deal had been halted and they are unlikely to raise the private capital they need to stay out of state hands.

National bought 84.3 percent of Eurobank via a share swap in February, with a view to absorbing it as part of broader consolidation in the banking industry to cope with fallout from Greece’s debt crisis and deep recession.

But the deal raised the concerns of the “troika” of the European Commission, European Central Bank and International Monetary Fund that it would create a bank too big relative to Greece’s economy and make it difficult to sell in future.

“Their admission that they are unlikely to raise the required 10 percent from private investors is quite negative (as) their shareholders may become owners of a nationalized bank,” said Maria Kanellopoulou, an analyst at Euroxx Securities. (more…)

EU Official: Cyprus Was A Special Case, But…

HELSINKI (Reuters) – Big bank depositors could take a hit under planned European Union law if a bank fails, the EU’s economic affairs chief Olli Rehn said on Saturday, but noted that Cyprus’s bailout model was exceptional.

Olli Rehn

“Cyprus was a special case … but the upcoming directive assumes that investor and depositor liability will be carried out in case of a bank restructuring or a wind-down,” Rehn, the European Economic and Monetary Affairs Commissioner, said in a TV interview with Finland’s national broadcaster YLE.

“But there is a very clear hierarchy, at first the shareholders, then possibly the unprotected investments and deposits. However, the limit of 100,000 euros is sacred, deposits smaller than that are always safe.”

The European Commission is currently drafting a directive on bank safety which would incorporate the issue of investor liability in member states’ legislation. (more…)

It Can Happen Here: The Bank Confiscation Scheme for US and UK Depositors

By Ellen Brown

Global Research, March 29, 2013

stealing_money_safe_lg_nwm

Confiscating the customer deposits in Cyprus banks, it seems, was not a one-off, desperate idea of a few Eurozone “troika” officials scrambling to salvage their balance sheets. A joint paper by the US Federal Deposit Insurance Corporation and the Bank of England dated December 10, 2012, shows that these plans have been long in the making; that they originated with the G20 Financial Stability Board in Basel, Switzerland (discussed earlier here); and that the result will be to deliver clear title to the banks of depositor funds.  

New Zealand has a similar directive, discussed in my last articlehere, indicating that this isn’t just an emergency measure for troubled Eurozone countries. New Zealand’s Voxy reported on March 19th:

The National Government [is] pushing a Cyprus-style solution to bank failure in New Zealand which will see small depositors lose some of their savings to fund big bank bailouts . . . .

Open Bank Resolution (OBR) is Finance Minister Bill English’s favoured option dealing with a major bank failure. If a bank fails under OBR, all depositors will have their savings reduced overnight to fund the bank’s bail out.

Can They Do That?

Although few depositors realize it, legally the bank owns the depositor’s funds as soon as they are put in the bank. Our money becomes the bank’s, and we become unsecured creditors holding IOUs or promises to pay. (See here and here.) But until now the bank has been obligated to pay the money back on demand in the form of cash. Under the FDIC-BOE plan, our IOUs will be converted into “bank equity.”  The bank will get the money and we will get stock in the bank. With any luck we may be able to sell the stock to someone else, but when and at what price? Most people keep a deposit account so they can have ready cash to pay the bills.

The 15-page FDIC-BOE document is called “Resolving Globally Active, Systemically Important, Financial Institutions.”  It begins by explaining that the 2008 banking crisis has made it clear that some other way besides taxpayer bailouts is needed to maintain “financial stability.” Evidently anticipating that the next financial collapse will be on a grander scale than either the taxpayers or Congress is willing to underwrite, the authors state: (more…)

Cyprus: Savage Austerity Measures and Economic Dictatorship

depression

By Jordan Shilton and Chris Marsden

Global Research, March 24, 2013

Cyprus’ fate illustrates how the European Union imposes the dictatorship of the global speculators, banks and corporations on the working class. The EU yesterday continued to demand massive austerity in Cyprus to raise €6 billion ($7.8 billion) in return for a €10 billion bank bailout.

The island country has been the centre of an escalating financial crisis, with its parliament voting Wednesday to reject proposals to raise the necessary funds by taking money from anyone with deposits in Cypriot banks.

A new vote on whether to impose a “haircut” on depositors was delayed until today. The EU and European Central Bank (ECB) dismissed proposals by Cypriot politicians—themselves wholly reactionary—to create a “solidarity fund” to raise the six billion demanded.

Cyprus’s aim was to preserve its financial relations with Russia and force workers to pay the price by nationalising pension funds to pay the debts of the super-rich. Other proposals included seeking contributions from the church and selling gold reserves—all in order to avoid levying a significant one-off levy on major depositors.

However, the EU bluntly dismissed these measures as insufficient. German Chancellor Angela Merkel declared baldly after a parliamentary meeting of the Christian Democratic Union (CDU), “We want Cyprus to remain in the euro zone”, but insisted that its “current business model is dead.”

The ECB has insisted that the levy on investors should be re-imposed—this time with a widely-anticipated penalty of 15 percent on depositors with balances over €100,000, as initially rejected by Nicosia. If not, it was made clear that proposals had been discussed to prepare for and limit the impact of a Cypriot exit from the euro zone. (more…)