Bank run fears keep eurozone on edge

Deutsche Welle, 27 March 2013

As banks in Cyprus prepare to reopen, experts say financial institutions need to regain depositors' trust. They insist events in Cyprus won't be repeated in other euro countries.

Depositors in Cyprus have lost faith in banks. Although Cypriot officials said all banks in the country would open on Thursday, fears of a bank run - when bank customers withdraw their saving en masse - continue to plague the country.

"A bank run is a question of trust," Thomas Schuster of the Cologne Institute for Economic Research told DW. "If everyone believes their money is not safe then it becomes a self-fulfilling prophecy. Trust needs to be established."

Trust is the key

But until this trust can be re-established, authorities in Cyprus will take other measures in an attempt to protect financial institutions - and their employees.

 Controls will be placed on how much
Cypriots will be able to take from their\
savings each day

Cypriots can count on limits remaining in place on how much they are allowed to withdraw from their accounts. When banks open on Thursday the daily limit will be 300 euros. A key factor will be ensuring that businesses have enough access to money to pay their employees at the end of the month.

Dangerous levy

Experts blame discussions about a levy on deposits under 100,000 euros for Cypriots' loss in trust in the banking system. Although those with savings less than 100,000 euros will no longer be required to contribute to Cyprus' rescue effort, it was bad enough that this was even raised as a realistic possibility.

"From the very beginning, the tax on deposits was a non-starter," he said, adding that money is the world's most mobile product. "If someone taxes or wants to tax money then it goes somewhere else right away."

The bill for rescuing banks will be paid first by the banks' own funds, then shareholders will be held responsible and only if their money is insufficient will the state be forced to contribute.

In order to increase its income the government will place higher taxes on industries that cannot easily move away, Schuster said. He said he supported raising income, capital gains, property and value added taxes rather than a levy on deposits.

Hard times ahead

Regardless of how the state comes up with the necessary funds, hard times loom ahead for Cyprus.

"We are going to suffer from a serious recession for the next two or three years," George Michael, managing director of IMH, Cyprus' leading business publisher, told German daily "Die Welt."

Estimates suggest consumption will fall by 10 to 20 percent in 2013 and the country's gross domestic product will likely decrease by 20 percent.

"The die has been cast Cyprus for some time now," Martin Hellmich, of the Frankfurt School of Finance and Management, told DW. Measured in absolute terms, Cyprus is too small to endanger the entire eurozone's financial system.

"It is much more important to make clear that Cyprus is a unique case that will not repeat in Italy or Spain," Hellmich said. "That's the deciding factor."

Depositors in Germany are also concerned about events in Cyprus. Some 54 percent of Germans do not believe Chancellor Angela Merkel's statement that savings in Germany are safe, according to a Forsa survey.

People queue outside a Laiki bank branch in Nicosia.

Photograph: Patrick Baz/AFP/Getty Images

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Matthew message (Channelled by Suzanne Ward, Feb 18, 2013)

"... The Rothschild faction of the Illuminati, which governed its empire from London and the Vatican, lost its media foothold along with its other powers in that part of the world. A section of the Illuminati’s Rockefeller faction, headquartered in Washington, DC, and New York City, still has influence on major media in the US as well as on Wall Street; and their lingering foothold in Congress is evident in the intransigence that has stagnated progress. .."

In this photo provided by the Vatican newspaper L'Osservatore

Romano,  cardinals attend a meeting at the Vatican, Monday,

March 4, 2013. (AP Photo/L'Osservatore Romano, ho)

Archangel Michael on the World’s Movement into the Golden Age, March 24, 2013 – Part 2/2 - New

“… GW: Shifting to events that are taking place in Europe at this point in time, it seems that the events in Europe are reaching or about to hit a breaking point of some kind. Several leaders, including Nigel Farage and allegedly Russian Prime Minister Medvedev have suggested that people should be removing their money from their accounts as the cabal may attempt a last ditch grab for money.

Now, I know, and perhaps many know, that the current system is corrupt and that there will have to be a degree of change in the current system before people will be willing to embrace the new system.

I don’t wish this question to sound alarmist to people, but is what is happening now one of the final, if not the final, straw that will help expose the banking cabal and allow the new system to be implemented? Is this new system ready? Or is it already being implemented? Or is it still only limited to preparatory work?

AAM: No, it is already underway. It is already being implemented. And yes, we do not wish to sound alarmist either, and so we also wish people to know that their resources, what they think of as their money, for those who have saved and put their faith in banking systems, they will be protected to a certain extent. So do not think that you have need to run out and remove all your monies, or that it will be completely gone. But yes, this is the beginning of a transition.

The expression of the lack of faith in particularly the European banking system causes enormous disruption, more significant perhaps than anywhere else. And so yes, it does have a domino effect, but it is not one simply shutting down [the old system] and a new system emerging. It is coming into balance with the new emerging as the old simply fades away.

Is it a last ditch effort on the part of those who have clung to the old paradigm of the 3rd, what you call the cabal? Yes, it is. But it matters not, because it is not going to work for them. Seldom are things such as this situation so black and white. There is always room for free choice and free movement and adjustment.

But in this situation it is simply evolution and expansion. And the expansion of the new, of the new paradigm, of what you think of as Fifth-Dimensional financial systems does not allow for systems that are based on greed and theft and control — and unfairness, basic unfairness, usury.

So, it is rather clearly defined. You have an expression that you use on Earth, “Out with the old.” And this is one of those situations where it is, in fact, the truth.

GW: Okay. So, along the lines of the leadership, or at least some of the leadership of what’s taking place in the financial sector globally, it has been reported that the apartment of the IMF managing director Christine Lagarde was raided last week.

Was this an attempt to expose her as part of the banking cabal, or was it an attempt to stop her from fulfilling the reforms that she is allegedly trying to bring to the international banking system?

AAM: It was an attempt to gather information and perhaps even destroy documentation that she is trying to bring forth for the reform of the financial situation. It was an unsuccessful raid.

GW: Okay. So what I’m hearing in your answer, then, is that Christine Lagarde is working for, I guess, the forces of light to bring the greater change to the IMF. Am I correct?

AAM: Yes. This one has had a real turn-around. No, we do not ever categorize individuals or groups or people as light or dark. But this one has truly committed herself to reformation.

She sees and she has the experience very clearly of knowing what does not work. And therefore she has committed her mission, her purpose to this reformation.

GW: Okay. And could the same be said about the new US Secretary of the Treasury Jack Lew? Is he on board with all the changes and working for the reformation as well with Lagarde?

AAM: He is an agent and an angel of change. He could not be simply on board. He is a moving force. ‘…‘’