Reuters is reporting this morning comments from the Dutch Finance Minister, Jeroen Dijsselbloem, who by the way heads up the group of European Finance Ministers, to the effect that the "solution" in Cypress is a "new template" to address future banking problems in the Euro area.
I want you readers, particularly those of you in the Eurozone, to wrap your heads around this and consider the brazen audacity displayed by these people. What he is saying is that bank savings deposits no longer effectively belong to you the savers. They belong to the state and the state will confiscate them whenever it is deemed to be in that state's best interests.
If this does not send shock waves throughout the system and instill fear in individuals throughout the Eurozone, then there is no hope for any such people. Normal, rational, sane, thinking individuals will immediately recognize this for what it is; a complete reversal of the traditional role of banking in which banks makes loans to depositors and other individuals. Now, depositors are in effect making loans to banks. Yet even that is not an apt comparison for in the case of a loan, one usually expects to receive back the amount loaned plus interest. In this case, the depositors are having their money forcibly extracted from them with no hope of ever seeing it again and having that money used to bail out the banks instead! I never believed I would EVER witness this in my life and yet here it is. What is even worse is the blasé attitude displayed by the monetary authorities. Just who in the hell do these people think that they are?
These pestilential parasites, who sit in ivory towers and can glibly utter such rapacious comments, are literally undermining the entire banking system in their shortsighted idiocy.
Do these fools really believe that those citizens who have money in Eurozone banks, particularly high net worth individuals, are going to merely sit by and calmly observe this situation and do absolutely nothing? I cannot think of a better way to start a run on the banks. If individuals believe that the state now believes it has the right to raid their hard earned wealth at any time why would they feel the least bit secure about putting that wealth in harm's way?
As far as the price action in both gold and in the euro goes, Gold was down rather sharply early in the session as the safe havens were thrown out once a "deal" was announced. The Euro was down but not by much considering the backdrop. Once those Dutch official's comments hit the wires, the bottom fell out of the Euro and gold began working off its lows.
Gold in Euro terms shot sharply higher and is up nearly 1% as I type these comments. If it can push past the 1250 euro mark, it looks like it has room to make a run to 1280.
I am still thunderstruck as I contemplate those comments uttered by Mr. Bloem. This is like something out of fictional novel and yet it is happening right before our eyes.
"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat
Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput
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