Cyprus Nationalizes 40 Percent of Depositors’ Funds

Well its official. The despotic elements of the Eurozone’s dictatorial leadership have prevailed over democratic moderates and forced Cyprus to accept a bailout package that consists of the theft of up to 40 percent of deposits over €100,000 held in top lender Bank of Cyprus.

Though only 1 percent of GDP of the entire Eurozone economy, the fallout from this unprecedented theft from depositors accounts to offset the reckless bets of bank management will have a destabilizing effect on the entire region according to James West, publisher of the Midas Letter.

“If it was Argentina, or Russia, or North Korea making such an announcement, I wouldn’t be surprised,” he said. But Cyprus, as a Eurozone member, has just established that the risk of nationalization of private property is now a Euro-wide risk. Worse, it is now clear that the Euro region has no compunction about privatizing banking profits while socializing losses. Penalizing the middle class, which is the demographic layer that typically might have €100,000 Euros or more on deposit is going to damage the entire productive contribution to Euro GDP as a whole, and incremental capital flight will now begin.”

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