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The hot news out of Cyprus today is the direct confiscation of depositor's money via an alleged tax on deposits of 6.75 percent on amounts less than 100,000 euros and 9.9 percent above that.
The measures will raise 5.8 billion euros, Dutch Finance Minister Jeroen Dijsselbloem, who leads the group of euro-area ministers, told reporters early today after 10 hours of talks in Brussels. The euro region’s bailout kitty and, possibly, the International Monetary Fund will look to make up the shortfall. A partial “bail-in” of junior bondholders is also possible.Read that last paragraph carefully. Officials raped Cyprus citizens to avoid "unsettling investors in larger countries".
Funds to pay the levy were frozen in accounts immediately, ECB Executive Board Member Joerg Asmussen said.
Officials have struggled to find an agreement that would rescue Cyprus, which accounts for just half of a percent of the euro region’s economy, without unsettling investors in larger countries and sparking a new round of market contagion.
Here's the deal. Large investors should have risk. The nannycrats and thugs in Europe still don't see it this way and this is the most blatant example of theft yet, all in the name of preventing "contagion".
Contagion of Idiocy is Everywhere.
Mike "Mish" Shedlock