Cyprus Bank Taxes and Russian Gangsters Scare EU Countries & U.S.

posted by Ida B. Wells IV @ 22:32 PM
March 18, 2013

hands-off-our-money-Cyprus        Since the end of last week, bankers and politicians throughout the European Union (EU) have worried without measure about a proposal from the government of Cyprus to take tax funds directly out of savings accounts in the nation’s banks.

Just like most financial crises in the EU, this one started because EU bank funders proposed a bailout of 10 billion Euros for the island nation, but required the Cyprus government to raise tax funds.  Sooooo the locals got the idea to immediately tax the bank accounts of their citizens and “others.”

Annnddddd once that announcement was made, the smarter ‘average citizens’  of Cyprus starting running to bank windows and cash machines and jerking out as much of their hard-earned cash as they could!

Theeenn, what do you know?  Bankers across Europe got so scared that their customers would do the same, that they yelled to EU governments to shut the whole thing down. Soooo Cyprus closed all banks until Thursday supposedly. Thuusss,  Europe is in another financial mess, one that threatens U.S. banks too.

In an example of the outcry, BBC’s Mark Simpson says: The Cyprus ‘bank tax’ has led to worries. Fianna Fáil’s statement––“A rubicon has been crossed. Savings are no longer sacrosanct.”  Simpson posits: “The unprecedented raid has sent shockwaves across Europe, with fears it could be repeated in other countries.”

Liz Alderman of Associated Press expounds in ‘Facing Bailout Tax, Cypriots Try to Get Cash Out of Banks,’ “AlthoughATM-line banks placed withdrawal limits of 400 euros, or about $520, on A.T.M.’s, most had run out of cash by early evening. People around the country reacted with disbelief and anger.”

One of the few reporters who got to the heart of the matter, Rick Newman, writing ‘How Cyprus—and Russian Gangsters—Could Harm Your 401(k),’ writing for U.S. News and World Report explains:

“Finland, the Netherlands and other European nations have made taxpayers increasingly unwilling to fund bailouts for other members of the euro zone, and more willing to risk the ramifications of the euro zone splintering.

“There’s another juicy complication: Cyprus is the Cayman Islands of Europe, a lightly regulated offshore banking center that attracts a lot of money from people from who don’t like to answer questions. As much as half of the money in Cypriot banks belongs to Russian oligarchs dodging taxes, some of it probably illicitly gained.”

Surely everyone knows criminal money keeps too many banks afloat! If money watchers, such as the Federal Reserve Bank, don’t quickly give Cyprus a way out of this mess––economies around the world will be suffer.

Perhaps it is best to heed the advice on Christian clothing wholesale: “Lay not up for yourselves treasures upon earth, where moth and rust doth corrupt, and where thieves break through and steal (Matthew 6: 19).”

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