Best of the Week
Most Popular
1. Crude Oil and Water: How Climate Change is Threatening our Two Most Precious Commodities - Richard_Mills
2.The Potential $54 Trillion Cost Of The Fed's Planned Interest Rate Increases - Dan_Amerman
3.Best Cash ISA Savings for Rising UK Interest Rates and High Inflation - March 2018 - Nadeem_Walayat
4.Fed Interest Hikes, US Dollar, and Gold - Zeal_LLC
5.What Happens Next after February’s Stock Market Selloff - Troy_Bombardia
6.The 'Beast from the East' UK Extreme Snow Weather - Sheffield Day 2 - N_Walayat
7.Currencies Will Be ‘Flushed Down the Toilet’ Triggering a ‘Mad Rush into Gold’ - MoneyMetals
8.Significant Decline In Stocks On The Cards! -Enda_Glynn
9.Land Rover Discovery Sport Extreme Driving "Beast from the East" Snow Weather Test - N_Walayat
10.SILVER Large Specualtors Net Short Position 15 Year Anniversary - Clive_Maund
Last 7 days
Gold Junior Mining Stocks GDXJ Fundamentals - 23rd Mar 18
Global Trade War Fears See Precious Metals Gain And Stocks Fall - 23rd Mar 18
Stocks Recovering from a "deep dive" Overnight - 23rd Mar 18
Blaming the Fed for Weaker Greenback US Dollar - 23rd Mar 18
Watch This Group Signal Stock Market Trend Changes - 22nd Mar 18
Stocks are Gapping Beneath the Trendline Support - 22nd Mar 18
Fed Action Casts Shadow on Bullish Case for Stocks - 22nd Mar 18
A Strong Economy and Weak Stock Market is Bullish for Stocks - 22nd Mar 18
Fed Raises US Interest Rates 25bp – Where Are We In The Stock Market Cycle? - 22nd Mar 18
Why Spotify Will Likely Surge During Its IPO - 22nd Mar 18
SY Police Arrest Woman for Blowing Trumpet at Sheffield Tree Felling Protest - 22nd Mar 18
Facebook: The Anti-Social Network Covert Data Gathering - 21st Mar 18
Additional Signs for Gold and Silver Amid Increasing FOMC Tension - 21st Mar 18
Credit Concerns In U.S. Growing As LIBOR OIS Surges to 2009 High - 21st Mar 18
Stock Markets Are Flat-to-lower Before the FOMC - 21st Mar 18
Will Powell’s Actions Pop Stock Market Perfection - 21st Mar 18
Economic Moral Hazards of the International Criminal Court - and Philippines Withdrawal - 21st Mar 18
Larry Kudlow vs. Vladimir Putin on Gold - 21st Mar 18
Trump Builds Economy and War Machine - 21st Mar 18
This Stock Market "Illusion" Can Destroy Once-Vibrant Portfolios - 21st Mar 18
Gold Short-term Pull Back in Progress - 20th Mar 18
Stocks Appear to be Under Pressure - 20th Mar 18
Time To Eliminate Your Wall Street Tax? - 20th Mar 18
The Beast from the East Snow, UK Roads Driving Car Accidents - 20th Mar 18
Can Bitcoin Price Rally Continue After Paypal Fake FUD Attack? - 19th Mar 18
2018 Reversal Dates for Gold, Silver and Gold Stocks - 19th Mar 18
This Tech Breakthrough Could Save The Electric Car Market - 19th Mar 18
Stocks Set to Open Lower, Should You Buy? - 19th Mar 18
The Wealth Machine That Rising Interest Rates Create Conflict With The National Debt - 19th Mar 18
Affiliate Marketing Tips and Network Recommendations - 19th Mar 18
Do Stocks Bull Market Tops Need Breadth Divergences? - 19th Mar 18
Doritos Instant £500 Win! Why Super Market Shelves are Empty - 19th Mar 18
Bonds, Inflation & the Market Amigos - 19th Mar 18
US Housing Real Estate Market and Banking Pressures Are Building - 19th Mar 18
Stock Market Bulls Last Stand? - 18th Mar 18
Putin Flip-Flops Like A Drunken Whore On Bitcoin Cryptocurrency Legalization - 18th Mar 18
How to Legally Manipulate Interest Rates - 18th Mar 18
Return of Stock Market Volatility Amidst Political Chaos and Uncertain Economy - 18th Mar 18
Bitcoin Price Trend Forecast, Paypal FUD Fake Cryptocurrency Warning - 17th Mar 18
Strong Earnings Growth is Bullish for Stocks - 17th Mar 18
The War on the Post Office - 17th Mar 18
GDX Gold Mining Stocks Fundamentals - 16th Mar 18
Nationalism, Not the Russians, got Trump Elected - 16th Mar 18
Has Bitcoin Bought It? - 16th Mar 18
Crude Oil Price – Who Wants the Triangle? - 16th Mar 18
PayPal Cease Trading Crypto Currency Bitcoin Warning Email Sophisticated Fake Scam? - 16th Mar 18
EUR/USD – Something Old, Something New and… Something Blue - 16th Mar 18

Market Oracle FREE Newsletter

Urgent Stock Market Message

Forget 'Haircut', Instead Syriza Plans Beheading of Greek Bank Depositors, Theft of Deposits

Politics / Eurozone Debt Crisis Jul 05, 2015 - 12:55 PM GMT

By: Nadeem_Walayat


Greeks voting YES or NO won't make any difference to what I see as a near certainty of the Greek banks NOT reopening Tuesday, and it is not just because the banks won't have the euro bank notes in their vaults, it's because they are ALL insolvent and have been so for the past 5 years where the only thing that had prevented a collapse of the Greek banking system was generous and I mean GENEROUS support from the Euro-zone's ECB central bank that has literally financed every withdrawal from the Greek banks for the past 5 years, right up until Syriza announced its baldrick-esk cunning plan for a Referendum. That's over Euro 120 billion Euro-zone tax payers funds paid into the Greek banks to finance ALL withdrawals that amounts to 50% of the original total Greek bank deposits.

Therefore the only thing that the Greek central bank can do come Tuesday is to extend the bank holiday indefinitely as it works out how much of the Greek bank deposits it needs to steal in a 'bail in' or a 'haircut' as the bankster's prefer to call what actually amounts to a beheading, outright theft which is perfectly in line with the marxist ideology of Syriza.

How Much WIll be Stolen?

Well, Cyprus's theft of bank deposits of March 2013 is a good starting point as I covered at the time -

25 Mar 2013 - Cyprus Shows Your Savings Will be Stolen! UK Theft is by Means of High Inflation

The Damage Has Been Done Expect a Bank Run

The emerging details early Monday morning in the face of a literally eye popping deadline are that of at least 40% of deposits over Euro 100k will be stolen in the two largest cypriot banks, one of them Laiki (2nd largest) will definitely be wound down, many mainstream commentators have jumped onto the fact that the depositors will receive shares in the banks which might be fine if the shares were given AFTER the banks were restructured i.e. bad assets being written down, but they are not instead the depositors are likely to be handed what amounts to worthless toilet paper in exchange for their hard cash.

The damage has been done, as the one thing that the banking system relies on has been destroyed and that thing is confidence. No depositor in Cyprus has any confidence in any cypriot bank and will try to transfer out of the Cyprus tax haven at the earliest possibility so there will be a bank run on cypriot banks the unfolding of which will be inline with the capital controls have been put in place.

The damage has been done to the Cypriot economy as its biggest industry the finance sector has been destroyed to result in huge job losses.

The damage has been done as all businesses have been impacted severely due to both many businesses having had their bank deposits stolen and for Cyprus having become a cash economy, where credit is scarce and not trusted by suppliers, so expect many non finance related business to go bust over the coming months.

The damage has been done to the reputation of Cyprus, where it is now seen as a high risk destination for tourists and investors for the reason of perceived instability, just as Greece's tourist industry has suffered.

Therefore as a MINUMUM one can expect a similar theft of 50% of bank deposits over Euro 100,000. However, I think that the theft of Greek bank deposits will be a lot worse for ordinary Greeks, given the Greek economies economic collapse and unless the ECB opens the flood gates and starts pouring billions of euros per day into Greek banking system, then Greek banks could steal 50% of virtually all deposits starting from as little a balances of over Euro 5,000! Especially as Greece can only afford to refund Euro 3 billion of an estimated E120 billion of deposits. This highlights another point that Bank Deposit Guarantees tend to be worthless propaganda, for when banking systems collapse then the bank guarantees TEND NOT BE FULLFILLED!

The bottom line is that the Greek bank depositors only have themselves to blame for they have had ample warnings to get their funds out of Greek banks, especially in the light of what happened in Cyprus of over 2 years ago!

Cyprus's banking system exploding in spectacular style resulting in the overt theft of a growing percentage of deposits that could reach as high as 85% as the following real life example illustrates to what an 85% theft of this customers bank balance at Laiki Bank actually looks like -

Source - So, What's It Like To Have a Business in Cyprus Right Now?

Writes the account owner:

"Most circulating assets on our business Current Account are blocked. Over 700k of expropriated money will be used to repay country's debt. Probably we will get back about 20% of this amount in 6-7 years.

I'm not Russian oligarch, but just European medium size IT business. Thousands of other companies around Cyprus have the same situation.

The business is definitely ruined, all Cypriot workers to be fired. We are moving to small Caribbean country where authorities have more respect to people's assets."

Think it can't happen elsewhere? Think again! It CAN and WILL,which is why it is important to diversify OUT of bank deposits and into asset classes such as stocks and housing that are LEVERAGED to money and debt printing INFLATION as I have covered liberally over the years and in several ebook's that can be downloaded for FREE.

Ensure you are subscribed to my always free newsletter for ongoing in-depth analysis and detailed trend forecasts that include the following planned newsletters -

  • Why Thousands of Muslims Are Going to Live, Fight and Die in Syria / Iraq
  • US Dollar Trend Forecast Update 2015
  • Gold Price Forecast Second Half 2015

Also subscribe to our Youtube channel for notification of special video projects such as -

  • The Illusion of Democracy and Freedom
  • Did God Create the Universe?

By Nadeem Walayat

Copyright © 2005-2015 (Market Oracle Ltd). All rights reserved.

Nadeem Walayat has over 25 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.

Housing Markets Forecast 2014-2018The Stocks Stealth Bull Market 2013 and Beyond EbookThe Stocks Stealth Bull Market Update 2011 EbookThe Interest Rate Mega-Trend EbookThe Inflation Mega-trend Ebook

Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction.

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.

Nadeem Walayat Archive

© 2005-2018 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


05 Jul 15, 23:00

Hi Nadeem,

I have to disagree with your articles.

The problem with Greece is not an economic problem, but a POLITICAL one.

Therefore, the solution will be political!

06 Jul 15, 04:41


Economics is political propaganda. Governments bribe voters with printed money and then produce bogus statistics to hide the inflation that voter bribes generate.

Greece needs its own currency so that it can do this at hyper speed else it will continue contracting.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules