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

[generalmeow]

They won't do this here, because they don't need to. They have the option of printing money here, so they essentially already do this every year through inflation.

whats the real inflation rate? 5-10%? Then the government already took 5-10% out of all of our bank accounts this year. Same exact thing.

[Aloha_Shooter]

They won't do this here, because they don't need to.

The point of my post is that this isn't new, they have ALREADY done it here. The government and CME allowed Corzine's company to TAKE depositor assets -- in some cases, precious metals that the company was charging a fee to hold -- and use it to pay off creditors like JP Morgan before depositors got any of their money back. If anything, the Cypriot approach is more honest because they passed it as open legislation even if it was done in the middle of the night.

[hollohas]

They won't do this here, because they don't need to. They have the option of printing money here, so they essentially already do this every year through inflation.

whats the real inflation rate? 5-10%? Then the government already took 5-10% out of all of our bank accounts this year. Same exact thing.

The same loss to the account tho account holder, yes. However not being able to buy the same amount of goods with each dollar because of inflation doesn't make people panic. Most people see $$$ only, not buying power, so inflation doesn't have the same effect. What they are doing in Cyprus could very easily make people stand up and say "F U, I won't let you steal 7% from me so close my account." And blammo, you got a bank run.

People are weird like that. Increase their income tax and they don't complain too much. Take 7% from their deposits and I can see them getting uber pissed. The easy way to keep that 7% to themselves is simple...don't use the bank anymore.