The Cyprus situation was the first time the term Bail-Ins was used. Basically, it is renamed Grand Theft. If you or I took funds from private accounts without the owner’s approval, it would be called Grand Theft. The bankers and the state needed money in Cyprus, so they concocted this scheme to convert all depositors’ assets, above 100 K Euros, into bonds from the bankrupt state of Cyprus and named it “Bail In”. I view this in a different light and consider this action similar to one where you fill up your car at a filling station. The owner comes out and says, “I am hurting for cash due to my bad investment decisions, so I must impound your car or you can pay me $2,000.” You must “Bail-In” to help the owner finance this service station that you use once a week or the station will fail. Most would define this action as “Theft”.
In Cyprus, we have a collusive White Collar Crime between the State of Cyprus and the bankers. The net result was that:
o Banks closed but stayed in business;
o Capital controls were imposed;
o People could not write checks;
o People lost access to their money;
o Only limited amounts of withdrawals were allowed;
o Taxes were increased to pay the banking debt;
o Insiders were tipped off and removed their money before the fated weekend.
The Cyprus action caused investor fear across Europe and has caused money flight from the PIIGS (Portugal, Italy, Ireland, Greece and Spain).
Discerning American investors are asking themselves, “Will this type of theft arrive on our shores?” Stephan Lendman, http://sjlendman.blogspot.com/2013/04/secret-fdic-plan-to-loot-bank-accounts.html , answers, “yes”. Specifically, he says that current proposed legislation in Congress says that using Dodd Frank as a basis, that the FDIC can “Take control of banks it deems systematically important and write down your savings (and bank accounts) as part of the bail-in”. How can they do that? It is easy with the Dodd Frank law since it made all regulatory agencies, including the FDIC, report directly to the FED. You see, the FED is the one that needs the cash and there see roughly $12 trillion in private assets in savings, IRAs and 401Ks, in the banks. I believe they would love to get their hands on this money. The “systematically important” banks are the largest who are partial owners of the FED. I have said it before but I must say it again, I believe that the Dodd-Frank Law is a great tool kit for the “thieves that are in the counting house counting out our money”. You see, it legally makes the thieves control the cops. This is White Collar collusive crime that is now pending. Either the law passes or it does not. What do you think? I think it will pass and when it does, it will have a significant impact on all investors.
What to do? First, no one knows whether it will pass or how long it will take them to act in the ?bail-in?. If it does not pass, don’t worry about it. These White Collar criminals must use some form of “black letter” law to cover their actions. However, I believe that it is reasonable to believe that it will pass and it might be sometime in the next few months. Second, when it passes, there probably will not be much time to act since we are not insiders and will not get a warning. Thus, if one fears such an action and believes that it will happen, then it would be wise for that investor to take action to protect himself before the events occur. One possible investment alternative would be to get out of IRAs and 401Ks, invest in physical gold and silver, and take advantage of the current low prices.