MARKETS
Yes, this is getting old, but this week a new Mediterranean
country became the centre of the financial world’s attention.
It’s not even big enough to be one of the PIIGS, which used
to make all the headlines.
But Cyprus is important
for a whole new reason.
This time around, bank depositors will take a hit in
the effort to bail out the banks.
And that’s causing panic across
Europe…
What you need to know about this isn’t in the details.
They’re a complete mess and keep changing from one hour to the next. One moment
all depositors will lose a few percent of their deposits, the next only some
will.
What’s really important is the signal this sends. We’re
entering into the next stage of the financial crisis. The stage where governments
turn on their citizens.
This is exactly in keeping with Kris’ theme in Money
Morning. He’s written about this for over four years, including the Australian
government’s attempts to take your wealth, like they’re going to do in
Cyprus. It’s not just Cyprus, by the way.
In Japan, the government hopes to stimulate the economy by
creating inflation. That will have a similar effect on the country’s savers as
confiscating a proportion of their deposits would. In Italy, the German bank
Commerzbank is expecting a wealth tax to be brought in. France’s ill fated 75%
tax may not last, but it shows what’s making popular politics these days.
In Australia, the miners, polluters and ‘super profiteers’
are the target…for now. And on May 31st, the government will raid small superannuation accounts and unused
bank accounts.
All around the world, governments are beginning to see
their citizens as ATMs to pay for political promises. Whether its
entitlements, bank bailouts, wars or insulation schemes. Sure, simply taking
people’s deposits is particularly audacious. But you don’t even know if we’re
referring to Australia or Cyprus in that sentence. Both are up to the same sort
of confiscation.
By the way, if you’re thinking this is just a question of
finding the right kind of politicians to solve the problem, you’re going to be
disappointed. Remember the ‘there will be no Carbon Tax’ promise? Well, the
President of Cyprus was only elected three weeks ago, and promised deposit
taxes wouldn’t be part of any plan to bail out the banks. You never know what
you’ll get from a politician.
Reuters reports that Cyprus’ President initially
stormed out of negotiations with the IMF, EU and ECB when they demanded a tax
on depositors’ funds. But he quickly changed his tune when faced with the
bankruptcy of Cyprus’ two largest banks by Tuesday, after Monday’s bank
holiday.
Now the bank holiday has been extended to Thursday, which
really means indefinitely, because the bailout plan wasn’t passed by Cyprus’
parliament.
If we wrote to you about deposit confiscation, bank
holidays, bank runs, and all the rest of it a few years ago, would you have
laughed it off? Would it have seemed absurd?
Well, suddenly stuffing cash under your mattress seems a
whole lot less eccentric. Suddenly, owning physical gold outside the banking system
looks smart.
Nickolai Hubble aka +Nick Hubble
The Daily Reckoning Weekend Edition - +Daily Reckoning Australia
The Daily Reckoning Weekend Edition - +Daily Reckoning Australia
REAL ESTATE
New Developments on
whether you can get your Mortgage Cancelled
Our recent articles about
this opportunity have really thrown the cat amongst the pigeons. People
affected by the crisis have sent in their thanks, feedback, criticism and
remarkable stories.
One couple that emailed were a victim of the kind of
manipulation the video exposes not once, but twice. Both when they got their
initial loan and when they refinanced. They only found out because the banks
sent them the proof by mistake.
But we’re just getting started. Soon, anyone in Australia
will be able to find out if they can get their mortgage
cancelled too. Read more...
Should you manage
your own investment property?
One of the most important decisions to make when you buy an
investment property is whether to appoint a professional property manager or
manage the property yourself.
More than three quarters (77%) of landlords have their
properties professionally managed by an agent, or have done so in the past,
according to The Australian Landlords Panel 2012.
Both options needed to be carefully considered before making
a final decision that is right for you.
Do-it-yourself property management can appeal to some
investors, who may see it as an easy way to save money.
However continue reading...
Western Australian
Seniors in Housing Crisis!
Advocacy groups say Western Australia's seniors are
suffering the worst of the rental crisis.
With our ageing population and a population influx, they say
more affordable housing is needed now.
WA is facing a seniors housing crisis continue reading...
SME
Local investors
backing Australian start-ups
Australian start-ups looking for funding no longer have to
head overseas to find investors, with a new program to raise $5 million for
local start-ups being launched recently.
Online start-up creator Pollenizer has launched an
Information Memorandum, aimed at raising dollars from continue reading...
Small Business
Commissioner turns up heat on government departments to pay small businesses
promptly
Australia's Small
Business Commissioner is putting pressure on government departments
and agencies to settle accounts with small business suppliers promptly.
In a speech
to the NSW Business Chamber, Commissioner Mark Brennan identified cashflow
problems as one of small businesses' main gripes. Read more...
Australia’s Business
Tablet Market Set To Explode In 2013
The use of tablet computers among Australian businesses is
set to increase by at least 50 percent in the next 12 months, according to a
new survey from market research group Roy Morgan. However continue reading...
We hope this edition has been helpful and that you will be "richer" for it! :)
Until next time dear readers...
No comments:
Post a Comment