sâmbătă, 16 martie 2013

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis


Contagion-Begging Actions; Expect Bank Runs Following Cyprus Idiocy; Have Money in a Spanish Bank? Take It Out Now!

Posted: 16 Mar 2013 03:20 PM PDT

In Cyprus, a decision was made to screw savers with a 6.75% to 9.9% "Tax" on deposits.

Supposedly this move was made to "avoid unsettling investors in larger countries and sparking a new round of market contagion."

In reality, the action was mandated theft, imposed by EU officials to protect senior bondholders.

How can such an action do anything but cause contagion?

The move is expected to raise a mere 5.8 billion euros according to Dutch Finance Minister Jeroen Dijsselbloem, leader of the euro-area ministers. Fallout from this action will cost far more than that.

Contagion-Begging Actions

What is someone in Greece, Spain, or Italy supposed to think?

Consider Spain. By a 526 to 86 vote, the nannycrats in Brussels just passed a regulation that will require a country to accept a bailout if offered. (Please see An Offer You Cannot Refuse; EU Passes Law Forcing Countries to Take Bailout; Is Spain the First Target?)

Also note that EU Court Strikes Down Spain's Eviction Law.

Think the parlay of EU contagion-begging actions for a second.

  1. Spanish banks will not be able to evict homeowners, who in turn will be give reason to default. Losses will soar at Spanish banks and they are insolvent already.
  2.  The "Offer You Cannot Refuse" action by the EU is sure to arouse suspicion of a forced bailout in Spain.
  3. Cyprus actions will heighten fears of bank takeovers, capital controls, and theft of deposits via confiscation. 

Expect Bank Runs

Why would any rational thinking Spanish person keep any money in Spanish banks? They shouldn't and I suspect they won't.

Moreover, this is bound to further inflame the situation in Italy, where Beppe Grillo's Five Star Movement is already the largest party.

In short, this action was one of the single stupidest things the EU could have done and they crammed it down the throats of all Cyprus citizens, hoping to stop the spread of contagion.

My friend Bernd who lives in Germany had these comments. "Judging by the German forums on Focus, Der Spiegel, SZ, FAZ and Die Zeit, there is hardly any support for this action. The name calling and swearing is rather blunt. These guys did not study their Machiavelli. He said roughly if you hurt people, you must never hurt all of them at once."

The closest Machiavelli quote I can find is "If you need to injure someone, do it in such a way that you do not have to fear their vengeance."

Rest assured there is going to be vengeance over this action. The Cyprus government will fall, and deposit fear will spread everywhere.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Wine Country Conference

I am hosting an economic conference on April 5 in Sonoma, California. Proceeds go to the Les Turner ALS Foundation (Lou Gehrig's Disease).

Please see My Wife Joanne Has Passed Away; Stop and Smell the Lilacs for my association with the disease.

To learn about the economic conference with world-class speakers including John Hussman, Michael Pettis, Jim Chanos, John Mauldin, Mike "Mish" Shedlock, Chris Martenson with guest moderator Lauren Lyster and other Special Guests, please visit Wine Country Conference April 5, 2013

Cyprus Rapes Citizens with 6.75% to 9.9% "Tax" on Deposits; Contagion of Idiocy is Everywhere

Posted: 16 Mar 2013 08:55 AM PDT

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.

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.
Read that last paragraph carefully. Officials raped Cyprus citizens to avoid "unsettling investors in larger countries".

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
http://globaleconomicanalysis.blogspot.com

Damn Cool Pics

Damn Cool Pics


California Conservation Corps members taught their big, country-ish boss to dance! [Video]

Posted: 15 Mar 2013 08:17 PM PDT



Not the unsuspecting members of the California Conservation Corps who were wowed by the unexpected groove of their lumberjack-looking coworker.

SEO Blog

SEO Blog


What Do QR Codes Mean To Your Ecommerce Site?

Posted: 16 Mar 2013 07:33 AM PDT

QR codes are a type of bar code that are scanned by smart phones. Rather than the traditional multi-width bar lineup, though, they appear to be a square of multi-spaced pixels. It is likely that, even if you are not sure you know what a QR code is, you have...
Read more »

What Are The Most Exciting New Web Design Trends?

Posted: 15 Mar 2013 11:05 PM PDT

The web design industry is evolving all of the time.  Although there is no question that this is exciting, it can also be immensely frustrating for those who work in the field, as well as website owners who have an amazing, innovative site one week, only for a new trend...
Read more »

Your Pinterest Weekly Email: 6 Recommended Boards

Your Weekly Pinterest

Hi, Hari!

Here at Pinterest...

Here at Pinterest...

The Biggest Loser Trainers and host share their tips on how to meet your personal fitness goals! We think their guidance, your motivation and the BiggestLoser.com At Home Program are the perfect combination for a successful plan.

Popular Boards

itty bitties

Dawn Shiree Dawn Shiree
itty bitties
1 2 3 4
 

film

Jeremy Caesar Jeremy Caesar
film
1 2 3 4
 

(Interior) Architecture

Jimmy Stegeman Jimmy Stegeman
(Interior) Architecture
1 2 3 4

The Great Outdoors

Gayle Harmuth Gayle Harmuth
The Great Outdoors
1 2 3 4
 

Products I Love

Megan Roberts Megan Roberts
Products I Love
1 2 3 4
 

Teaching Ideas

Chelsie Grate Chelsie Grate
Teaching Ideas
1 2 3 4

Pins You'll Love

Raspberry Tequila Sangria
578 likes 2154 repins
janelle w. via Marly | Namely Marly onto food : lovely things : fun
How did I NOT know this? Never boil corn again ...
259 likes 1136 repins
Kathy Novak via Cyndi Holzer onto Recipes I want to try...
 
Chocolate Fondue Bar
248 likes 603 repins
Laura Martin via Laura Ruth onto Party Time
How make to make your own Rock Candy!
260 likes 834 repins
Jennifer Haber Fishkind via Janet onto Want...Need...Love!
 
288 likes 528 repins
Sara Harvey via Jessica Miller onto INK & iNSPiRATiON
Grey.
277 likes 746 repins
mrs. french * via Robin Reilly onto lovely things to wear
Like us Get the apps

This email was sent to e0nstar1.blog@gmail.com.
Don't want your weekly Pinterest? Change your email preferences.

©2012 Pinterest, Inc. | All Rights Reserved.
Privacy Policy | Terms and Conditions