Cyprus Deposit Tax: Could This Start A Rush To Hard Assets?

Cyprus means nothing. So long as CB's call the shots and have their mighty hand involved, these are nonevents and nothing but filler for the stupid financial press to banter about and make the public go in circles.

Besides, silver and gold's price action showed how much they cared about Cyprus !


Again, Cyprus was a HUGE yawn.

Actually Cyprus is a big deal. It showed the elite bankers and power hungry politicians that they can steal money from bank depositors out in the open and get away with it with very little outrage. Watch for many more Cyprus' to come.
Cyprus is only one peace of the puzzle. It needs to be looked at with everything else that is going on right now globally. It all adds up to something that none of us are going to like.

So, I have been away for a month, shielded from any international news. I come back and it seems that Cyprus is the new headline.

I am no financial expert, so much if this is too complicated for me to understand and so much happened that I missed. But... This discussion is fascinating and the OP has a good question.

Below is an article (sharing two opinion pieces) that I believe highlights some of the issues not yet discussed here.

http://www.mauldineconomics.com/out...mu-is-benign

Due to the new deal, The Cyprus printed Euro is no longer equal to those printed in other EMU nations. As has been repeated already here, "The actions in Cyprus could be an indicator for action in others nations".

To answer the OP, I don't personally see a rush to hard assets soon. If anything, I would expect a euro rush to the dollar and continued decline in hard assets like some PM.

Time will tell and I am feeling like being patient.

Cyprus is a big deal, not because of the size of the financial impact but because a precedent has been set. Where will they stop. Today it is Cyprus, next Greece, Spain, Portugal and then....?

Its news worthy, but it really didnt teach us anything new about Europe or their climate. Just look at what some of the other countries have done/tried. France tried to put a 90% tax on the rich which is just insane.

Canada and the US are parts of the global puzzle.
To all you Cyprus yawners, you obviously didn't have
segregated funds with MF Global when J.Corzine played
at the derivative casino and lost 1.5 billion.
Bernanke said if it gets contagious, the US could
and will do the exact same thing as in Cyprus
It seems the 2013 Canadian budget has included a
"bail-in" Cyprus style haircut from depositors
to banksters if needed.Key word "bank liabilities"
And this budget was written BEFORE the Cyprus saga.
Go to page 144-145

http://www.budget.gc.ca/2013/doc/pl...2013-eng.pdf

Europeans are already pulling their money out and investing
in gold but even more in silver.
Cyprus IS coming to America

Aside from the fact that hes wrong on several points such as it discourages crime and get rich quick schemes, it would be quite the opposite. So much of your money is being taken its not worth it to put in an honest days work. It will also encourage you to hide money and assets overseas. Theres also absolutely no way that would restore faith in democracy, that would crush the faith that its gone and remove incentives to work.

But he also leaves out the fact that such a rate would just cause wealth to leave the country or simply stop working. The rich dont have to work, they do it because it benefits them and or they enjoy it. You take 90 percent of what they make and theyll say its not worth it anymore. They could simply put their money into well performing stocks and get basically the same return on their money. Well invested stocks will generall yield at least 5% and with no income theyd have the lower cap gains tax rate.

When the french tried it before being struck down the wealthy were fleeing in droves. Mansions were all put on the market and they left. No one is going to put up with paying 90% and quite frankly no one should ever have to pay that much.

Theres a very fine line with taxes. You can increase them to an extent and get more revenue but once you get over a certain point you cost yourself money which has been proven time and time again yet no one seems to learn that lesson. You can be anywhere in the world in 24 hours now and move your money with a click of a mouse, it doesn't take 3 months on a ship filled with coins to leave anymore.

I would put 0 stock into that article, it was written from a political agenda not an economic analysis