Cyprus government instigating a run on the banks and a collapse of their banking system

I'm watching Cyprus closely via Zero Hedge -->http://www.zerohedge.com/

The Cypriot reaction will tell us if this government behavior will continue immediately or if the EU will hold off for a while.

If you have convertible paper assests I'd start thinking about moving them to a "defensible assest" as Ann Barhardt would say. A defensible asset is something (gold, silver, booze, food, medical, ammo, components, firearms, car parts,) anything you can control within the confines of your home or shop or cabin or whatever.

Thanks to this little fiasco, Bitcoins are trading at around $75 a pop. I bought them at $11.

Silver has seemingly hit a low point, and has been running flat for the past month, granted volatility has been high, it's averaging flat. If you're not buying any now, you might want to start considering it. I see little to no reason to expect it to drop further.

Anyone here who is saying that this Cypriot crisis is going to be anything other than a bump in the road is taking full advantage of Amendment 64. I traveled with two CFA's today who both said, almost simultaneously, that this will amount to nothing and reiterated that the US produces more in GDP by lunch time every day than Cyprus does in a year.

Take it from me or don't. I kinda do this for a living.

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Originally Posted by Cylinder Head

Anyone here who is saying that this Cypriot crisis is going to be anything other than a bump in the road is taking full advantage of Amendment 64. I traveled with two CFA's today who both said, almost simultaneously, that this will amount to nothing and reiterated that the US produces more in GDP by lunch time every day than Cyprus does in a year.

Take it from me or don't. I kinda do this for a living.

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I don't think the GDP of Cyprus is the focus here. As roberth said above, it's more about the reaction to it and if it indicates government behavior like it will continue. Every reaction is indicative to one degree or another.

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Originally Posted by Sawin

I don't think the GDP of Cyprus is the focus here. As roberth said above, it's more about the reaction to it and if it indicates government behavior like it will continue. Every reaction is indicative to one degree or another.

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Economies of scale, Cyprus has 10bil in total deposits, most of which is "stashed" money by wealthy Russians and ME'ers. Draghi guaranteed deposits for the big boy banks. Nobody who owns Italian sovereign debt has been asked to take a 53% haircut.

If you're looking for a reaction, the FTSE was up, Euro only fell .02% to the dollar and gold was down today. Are those indicators of an impending crisis? I'd avoid Euro banks right now but I would double down on Sanofi, Kone, Reckitt, BAT.

Quote:

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Originally Posted by Sawin

Silver has seemingly hit a low point, and has been running flat for the past month, granted volatility has been high, it's averaging flat. If you're not buying any now, you might want to start considering it. I see little to no reason to expect it to drop further.

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Stash some in your gun safe. You will always see ads that say trade for silver.

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Originally Posted by Cylinder Head

Anyone here who is saying that this Cypriot crisis is going to be anything other than a bump in the road is taking full advantage of Amendment 64. I traveled with two CFA's today who both said, almost simultaneously, that this will amount to nothing and reiterated that the US produces more in GDP by lunch time every day than Cyprus does in a year.

Take it from me or don't. I kinda do this for a living.

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So, the EU just said that in a EU country:

a. bank protection means dick and your money isn't safe from the government
b. the law doesn't say what it says it does (just like GM)
c. banks will be made whole at the cost of inverting the capital structure
d. well connected people can still get their money out (they didn't close the branches in London or Greece, almost 3 billion has been removed, regular people don't go to London)
e. Capital controls will be imposed in a EU country ongoing
f. Banks have been closed in an EU country for going on 2 weeks now with no reopening in sight.

But hey, it's all ok, keep putting your money into banks and we won't take your retirement, look, we promise.
hey, it's the EU, it's not the US, really, don't worry, party on, DOW is making new highs, there is no inflation and the deficit is totally under control.

why would anyone run a business in this environment?

Quote:

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Originally Posted by Cylinder Head

Economies of scale, Cyprus has 10bil in total deposits, most of which is "stashed" money by wealthy Russians and ME'ers. Draghi guaranteed deposits for the big boy banks. Nobody who owns Italian sovereign debt has been asked to take a 53% haircut.

If you're looking for a reaction, the FTSE was up, Euro only fell .02% to the dollar and gold was down today. Are those indicators of an impending crisis? I'd avoid Euro banks right now but I would double down on Sanofi, Kone, Reckitt, BAT.

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I didn't see a dramatic movement in either direction either.

Cyprus isn't a watershed for the financial markets, it is a watershed for government confiscation of private assets that people do not maintain direct possession of. The lesson is that the government considers all monies to belong to the government and the government will take them when it sees fit. The only assets a person truly owns are the assets within a persons direct control, i.e. the safe in your basement.

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Originally Posted by roberth

I didn't see a dramatic movement in either direction either.

Cyprus isn't a watershed for the financial markets, it is a watershed for government confiscation of private assets that people do not maintain direct possession of. The lesson is that the government considers all monies to belong to the government and the government will take them when it sees fit. The only assets a person truly owns are the assets within a persons direct control, i.e. the safe in your basement.

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exactly!!!!!!!!!!!!!

http://www.telegraph.co.uk/finance/f...one-chief.html