Irish Finance Minister Noonan Proposes Bail In Policy

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Noonan's gesture to depositors

Noonan’s gesture to depositors

Under the presidency of the EU, the Irish finance minister Michael Noonan(2012 Bilderberg attendee) has proposed making the Cyprus theft “bail in” using deposits over €100k policy for future bank collapses. The BIS sets the banking agenda and they want depositors raped when banks collapse along with using “bail ins” to pay for bankers remuneration (big bonuses) according to a recent paper. Judging by the state of European banks, a lot of people are going to have their wealth wiped out and everyone will be at the same wealth level in the Orwellian EUSSR.

Deposits of over €100,000 are likely to be hit in the event of future European bank collapses, according to a proposal put forward by the Irish presidency of the European Council ahead of a key meeting of finance ministers next week.

Discussions on the controversial bank resolution regime, which is likely to see savers with deposits over €100,000 “bailed in” as part of future bank wind-downs, are due to intensify this week in Brussels, ahead of Tuesday’s meeting, which will be chaired by Minister for Finance, Michael Noonan.

“We will try to get some guidance from Ministers about the possible design of the bailout tool,” one EU official said yesterday.

Under a compromise text proposed by the Irish presidency, uninsured deposits of over €100,000 would be bailed in in the event that a bank is resolved, but depositors would rank higher than other creditors in the event of a wind-down.

In this scenario – known as “deposit preference” – depositors would rank at the very end of the process, with other creditors first absorbing losses.

However, some member states have not ruled out the possibility that insured deposits, i.e. deposits under €100,000, would be forced to bear losses in the event of a bank collapse even though these deposits would be likely to be protected by the deposit guarantee scheme.

However, the explicit exclusion of insured deposits from future “bail-ins” could in fact be included in the final text, according to some sources, with some MEPs in particular keen to include such a provision.

Significant differences still remain between states on the issue, with some countries calling for greater flexibility as regards the application of the new rules on a national basis, including the possibility that individual countries could be permitted to exempt large depositors from losses if a bank fails.

The introduction of an EU-wide bank resolution process, which would govern how banks are wound down, is a key strand of the EU’s plan for a pan-European banking union, which was endorsed by EU leaders at last June’s summit.

However, the chaotic Cyprus bailout instilled the issue with greater urgency, with EU lawmakers now keen to provide clarity around bank collapses.

Moving the burden
This year Jeroen Dijsselbloem, head of the group of 17 euro zone finance ministers, said that losses on bondholders and depositors could form part of future bank bailouts as euro zone officials seek to move the burden of bailouts away from taxpayers – as was the case in the Irish bailout – and on to private investors.

The European Commission argues that this switch from so-called “bailouts” to “bail-ins” would result in an allocation of losses that would not be worse than the losses that shareholders and creditors would have suffered in regular insolvency proceedings that apply to other private companies.

While the inclusion of large savers in future bank bailouts is now widely accepted, significant differences still remain between member states.

While the new rules governing bank resolution were first intended to come into place in 2018, since the Cypriot bailout there have been calls from senior EU figures such as European Central Bank president Mario Draghi and EU economics affairs commissioner Olli Rehn to introduce the new regime as early as 2015.

The Irish presidency of the European Council is hoping to reach a common position by the end of next month.

Noonan demonstrate how much you will be left with under the EU plan

Noonan demonstrates how much the EU/Banks intend you will be left with under the plan

 

 

 

 

Source: Irish Times, BIS

Sinclair – Something Has Western Central Banks Terrified

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Jim Sinclair gave an interview with King World News the state of Western Banks and how the Quadrillion of derivatives will eventually lead to more Cypriot solutions.  Eventually in a couple of years from now people will “realize that gold is for your savings, and currencies are for doing business”.

Eric King:  “Jim, Bloomberg had a story headlining on their site over the weekend claiming that depositors may lose as much as 60% on deposits in Cyprus.”

 Sinclair:  “This is all because of the one quadrillion dollars in derivatives that are in the financial system.  Six years ago the Bank for International Settlements (BIS) at that time reported that the amount of derivatives already outstanding exceeded one quadrillion dollars.  This number is unimaginable to most human beings.

But that is the actual number (over one quadrillion dollars).  They never should have released that number because it created a bit of panic.  Central planners immediately changed the accounting method for derivatives and this appeared to bring the total amount down to under $700 trillion.  So through the use of an accounting gimmick the total was reduced, but it hasn’t changed the frightening reality of what the world is facing….

“But the real size of derivatives outstanding is well over one quadrillion dollars, and something clearly has our central banks terrified right now.  We already know that Bernanke has led the US to significant amounts of QE, and the same is true of euro land.  Maybe they are now looking at what the real cost of the derivatives will be and saying to each other, ‘Nobody can create that much money.’

 What we may be seeing now is the fact that the central banks can no longer make the depositors whole.  They are hitting the wall.  This means that money is absolutely going to look to leave the financial system if indeed the final decision in Cyprus is to take money from deposits.  We will know the answer as to what has truly been decided in Cyprus at some point during the April 13 to April 15 time frame.”

 

Eric King:  “Jim, what you are saying here is that we are entering another phase where we can expect a dramatic increase in chaos as the one quadrillion dollars in derivatives causes more financial destruction?”

 

Sinclair:  “Absolutely.  When people say that the Cypriot banks lost because of being in Greek debt, what was one of the Greeks’ greatest sins?  They used over-the-counter derivatives in order to hide the real condition of their balance sheet.

 Depositor money, brokerage money, and clearing house money have been tangled up in the mountain of derivatives as the banks have used this cash to speculate in an attempt to make huge bonuses for bank executives.  Unfortunately, most have lost their ass.  This means that in many cases depositor money has already been wiped out.

 What do you think happens when Buffett reports that he made $10 billion in derivatives?  Somebody else lost $10 billion and it was most likely one financial institution.  There is no question that what we are seeing right now is not isolated to Cyprus.  It has happened everywhere, but is has been camouflaged by making the depositors and the banks whole.  What Cyprus will reveal is that losses do not stop with the bank’s capital.  Losses roar right through bank capital and take depositors’ money. 

 What people don’t realize is that the derivatives, especially the ones created between 1991 and 2007, are never-ending manufacturers of greater size of paper obligations because you have to put these additional items onto the derivative chain as the markets have certain events take place such as a downgrade of debt.  God help us when we have a meaningful downgrade of US debt.

 So, clearly our central banks are now very uncomfortable.  They are worried about something of significant size which has yet to be revealed to the public.  I guarantee you that whatever it is will have to do with the derivatives created between 1991 and 2007.”

 Sinclair also added:  “As money flees the financial system, one of the top items being purchased will be physical gold.  Right now the gold market is engaged in an enormous fight between physical and paper.  But two to three years from today people around the world will come to realize that gold is for your savings, and currencies are for doing business.

 There’s absolutely no question that when it’s confirmed that the depositors’ loss of money is not a tax, not a new way of making things whole, but in fact the actual disaster that the global banking system is currently in, you will have a move toward physical gold greater than anyone on this planet now believes is possible.  We will also witness the beginning of a level of fear and panic not seen in this world since 1929.”

Source: King World News

All Wars Caused By Bankers

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GATA’s Bill Murphy Talks Of Gold Manipulation on Capital Account

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30 April 2012 – GATA’s Bill Murphy is interviewed on Capital Account.

  • Gold is unique as an asset class that is over 12 years on bull run.
  • Gold Cartel consists of Bullion Banks(HSBC, JPMorgan), the Treasury FED, BIS.
  • Cartel trying to slow down the asscent of gold (managed retreat).
  • Gold will eventually have to trade freely.
  • Gold is a barometer of financial health and this is the reason why its attacked.
  • Evidence has been gathered of manipulation since 1999.
  • The attacks are at certain times of day. (e.g. 3am New York time), attacks even when there is no news.
  • Central Banks are loading up on gold on the dips because they know how the Gold Cartel works.
  • Russia and China are very interested in how the Gold Cartel works and have approached GATA.

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