And in the continuum of creeping wealth taxes which first started in Switzerland, then Cyprus, and soon who knows where else, there was just one question: "The question then is: how many of the oligarchs, Russian or otherwise, who avoided a complete wipe out and total capital controls in Cyprus, will wait to find out if the same fate will befall them in Switzerland? Or Luxembourg? Or Lichtenstein? Or Singapore?" Today we got the answer, and yes it was one of the abovementioned usual suspects. The winner is.... Lichtenstein.
Yes: the little principality that is an even greater tax (evasion) haven for the world's ultra wealthy, even more so than Zurich, Geneva or Zug, is now under Big Brother's microscope.
But fear not. All the other tax havens listed above are quite certainly about to meet the iron, resolute fist of the US Department of Injustice. After all, unlike TBTF banks, depositors are hardly "systemic", and thus Eric Holder and his henchmen will have zero reservations when pursuing the full extent of the (selectively crony) US laws against them.
In case anyone is still confused about what is going on, here is the summary: any geographic venue that for whatever reason was once considered a global tax haven in the "Old Normal", be it Switzerland, Greece, Luxembourg, Singapore, or as the case may be Lichtenstein, is now fair game for confiscation and otherwise expropriation of local capital.
Alas, as this money will not be enough to plug what is not a liquidity but global insolvency black hole, which is made worse daily by the endless interventions of central planners, once the deposits of the wealthy at these small, powerless to defend themselves countries is concluded, next come the entities with the really big deposits: the US, the Eurozone, and the grand daddy of them all: China.
The new policy will alarm hundreds of thousands of British expatriates who live and have transferred their savings, proceeds from house sales and other assets to eurozone bank accounts in countries such as France, Spain and Italy.
The euro fell on global markets after Jeroen Dijsselbloem, the Dutch chairman of the eurozone, announced that the heavy losses inflicted on depositors in Cyprus would be the template for future banking crises across Europe.
"If there is a risk in a bank, our first question should be 'Okay, what are you in the bank going to do about that? What can you do to recapitalise yourself?'," he said.
"If the bank can't do it, then we'll talk to the shareholders and the bondholders, we'll ask them to contribute in recapitalising the bank, and if necessary the uninsured deposit holders."
Ditching a three-year-old policy of protecting senior bondholders and large depositors, over €100,000, in banks, Mr Dijsselbloem argued that the lack of market contagion surrounding Cyprus showed that private investors could now be hit to pay for bad banking debts.
Cyprus and the EU-IMF-ECB reached a last-minute bailout deal last night, granting Cyprus a $13 billion in emergency loans while shifting a huge burden onto large depositors shutting down their second-largest bank — but confidence is obviously far from restored, and one of the currency bloc’s major finance ministers confirmed that, heck yeah, if we have to, we’ll definitely use this as a template for other future eurozone banking crises. Oof, via Reuters:
“What we’ve done last night is what I call pushing back the risks,” Dutch Finance Minister Jeroen Dijsselbloem, who heads the Eurogroup of euro zone finance ministers, told Reuters and the Financial Times hours after the Cyprus deal was struck.
“If there is a risk in a bank, our first question should be ‘Okay, what are you in the bank going to do about that? What can you do to recapitalize yourself?’. If the bank can’t do it, then we’ll talk to the shareholders and the bondholders, we’ll ask them to contribute in recapitalizing the bank, and if necessary the uninsured deposit holders,” he said. …
Yikes. On the one hand, the No-More-Mr.-Nice-Guy attitude-shift needs to happen in some form, but Idoubt that kind of threat hanging over everyone is going to do anything for the euro or its markets. Then again, this is the fundamental problem with perpetually living beyond your means and failing to practice anything even approaching fiscal sanity, and with enabling others to do so: There is no good, pain-free solution. There just isn’t. Everybody is going to have to pay for those decisions, one way or another, to the detriment of economic growth and financial stability.
The Islamist-led government escalated tensions with opposition parties Monday after Egypt’s prosecutor general ordered the arrest of five activists, including a prominent blogger, for violent protests against the Muslim Brotherhood over the weekend.
The arrest warrants and complaints against scores of opposition figures came a day after President Mohamed Morsi threatened to crack down on political groups that he said were behind a surge in attacks on Muslim Brotherhood offices. Nearly 200 people were injured Friday when protesters attempted to storm the Brotherhood’s headquarters in Cairo.
The Brotherhood has increasingly become the focal point of the opposition’s rage. Believed to be the power behind Morsi, a Brotherhood member for decades, the world’s largest Islamist organization has been criticized by activists for an authoritarianism that has imperiled the economy and spoiled the nation's transition to democracy.
The six minutes recorded by Lt. Gen. William G. “Jerry” Boykin, retired, warns that America is well along the pathway that other societies have used to bludgeon and beat their populations into submission to socialism. Even to the point of establishing a “constabulary force” to control the people.