The Cyprus Situation

Glen_Clark

So the wealthiest depositors and bondholders who chose to invest in Cypriot Banks to get higher interest rates are going to take the hit.
What a contrast to the British money printing way of bailing them all out with everyone else's money!!

talexuser

kidmugsy wrote: »

No, there was no "need" about it; it was just that a socialist government lost its head, and consequently a pile of taxpayers' money.

Ah, I see... we would have been better off letting the banks go bust.

JohnRo

It's taken them well over a week to figure out the right course. I wonder now if they'll also follow in Iceland's footsteps and go after the reckless idiots who effectively created the mess and hold them directly responsible in a criminal court.

What a contrast Glen, indeed.

innovate

talexuser wrote: »

Ah, I see... we would have been better off letting the banks go bust.

Sometimes I do wonder whether this would have been better, yes. At least we would then not have bankers who think it will all continue as per normal and they'd be bailed out again next time.

The_Green_Man_2

I don't see why there is such outrage at this. In the UK our savings are insured up to £85k or £170k in joint accounts. Prior to the credit crunch it was insured up to £50k. Perhaps if we had stuck to these insurance policies when Northern Rock and especially when the icelandic banks went under, the UK taxpayer would not be laden with all this debt.

UK savers should follow the advice that Martin Lewis has been giving since the start of the financial crisis and keep your savings in each financial institution below these limits.

People should be responsible for their own finances. If they choose to put their life savings into a bank that is offering 120% mortgages, an overseas bank offering 'too good to be true' interest rates or try to hide their money in tax havens, then that's the risk they took. Why should the rest of us bail them out?

Glen_Clark

talexuser wrote: »

Ah, I see... we would have been better off letting the banks go bust.

I think so yes.
Bailing out the banks could yet bankrupt the country.
Even if it doesn't, it was wrong to take that risk.
But most of all, the people who are being made to pay for the bankers mess are the ones completely innocent of any wrongdoing. :mad:
Yet again, Britain is the odd one out in Europe, and not in a good way.

talexuser

innovate wrote: »

Sometimes I do wonder whether this would have been better, yes. At least we would then not have bankers who think it will all continue as per normal and they'd be bailed out again next time.

Actually I think so too. But we would immediately have had to split investment from retail, even if it meant nationalising retail in the short term, but may not have been absolutely necessary to keep retail accounts working. Is nationalising any worse than bailouts anyway, where the taxpayer is the largest shareholder, but has no say in how the company is run?

Wind down the investment arm losses in an orderly way. The argument against was the tax that the city brings in, but is 10/15 years loss of national output really worse than that tax loss?

londonTiger

its a radical step, they chose to go after the rich millionaires (mostly wealthy people from abroad) rather than the local cypriots.

It's a bold move, here in the UK the rich get tax relief and poor get taxed til kingdom come.

I wonder what this would do to cyprus' migrant millionare residents in near future.

Tbh, i dont see much chaning, there are many mediterranean islands to choose from. Greece, Italy & Spain all doing bad.

kidmugsy

talexuser wrote: »

Ah, I see... we would have been better off letting the banks go bust.

No, we'd have been better off with an intelligent good bank/bad bank solution, as plenty of people pointed out at the time.

There might have been other better policies too; what we got was a socialists-losing-their-heads policy.

sabretoothtigger

It's a bold move, here in the UK the rich get tax relief and poor get taxed til kingdom come.

Hasnt this latest budget said no income tax for earning 10k. I know 10k is a poor mans wage by far but what you said doesnt reflect that

Everytime they argue rich dont pay their share, we have to ignore that they pay a percentage not a fixed amount.
In nominal terms rich pay a heck of alot.