“. . . In robbing Peter, the individuals performing the robbery will not be dressed like the individual in the photo [below]. They will be wearing suits, and they will present themselves as legitimate authorities, carrying out the law. Unlike a customary robbery, there will be no authority to complain to; there will be no means of recourse. Your wealth, however large or small, will be lost.” J Thomas
“A government that robs Peter to pay Paul can always depend on the support of Paul.” – George Bernard Shaw
“Since the beginning of recorded history, the business of government has been wealth confiscation.” – Ron Holland
“The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation.” – Vladimir Lenin
On 16th March 2013, the banks of Cyprus, with the approval of the Cyprus Government, the European Commission, the European Central Bank, and the International Monetary Fund, confiscated private savings of accounts exceeding €100,000.
At the time, there were two readings of the unanimous approval by four bodies. As the confiscation was presented to the public, the unanimous approval implied that the confiscation was above board. To those who looked a bit deeper, however, the unanimous approval meant that, not only had the four bodies clearly been working on the plan for some time, behind closed doors, but it also demonstrated that all four bodies colluded to steal a significant amount of privately owned money.
For those of us who took the latter view, the confiscation meant that there would be more to come—that Cyprus was being used as a test case. If successful—that is, if the world did not immediately express outrage over the theft—a precedent would be set whereby the EU, the IMF, and presumably any of the banks and governments of the world could assume that it was alright to confiscate private funds, so long as there was an “emergency.”
As it turned out, they got away with it. There was no great outrage—very possibly because so few people in the world were directly impacted, so they were not especially bothered.
However, the precedent had been set, and at the time, I predicted that this was a test case and that the Cyprus model would spread.
I subsequently wrote a follow-up article, when Canada wrote into its 2013 budget that the Canadian banks could perform their own bail-in, should they find themselves in a state of “emergency.”
But, in fact, this did not begin with Cyprus. It began in November of 2010 in a meeting of the G20 countries, all of whom agreed to the concept of a bail-in. Since then, under the UK Banking Act 2009, legislation allowing bail-ins was passed in the UK. The US followed with the Dodd Frank Act of 2010. Switzerland followed in 2013 with a revision of the 1934 Banking Act. Other countries followed—some having completed legislation, some still in the works.
Now, on 4th July, Spain announced that it would impose a blanket taxation on all bank accounts at the rate of 0.03% for the purpose of “Harmonizing tax regimes and generating revenues.”
Spain may defend its decision by pointing out that it has one of the lowest tax takes in the European Union, which is true. However, what should be the issue here is not the amount of tax being imposed, but the principle upon which the tax is being taken. Let there be no doubt about this bail-in or any other—it is pure theft.
There will be those who are shortsighted, who may point to the tax rate of 0.03% being low. But history shows us that, over time, once a taxation concept is accepted by those being taxed, the rate tends to be increased over time. (All taxes start out small.)
The measure in Spain is also an advance on the concept that, as long as an emergency is perceived to exist, confiscation is justified. In Spain, no emergency situation is being pretended; they simply want the money and have decided to take it.
There are a number of points that the reader may wish to consider, even if he does not reside in Spain:
- Since the initial confiscation in Cyprus attracted the approval of the EU and the IMF, it should not come as a surprise if the EU passes bail-in legislation. (Indeed such legislation is now in the works.)
- It is unlikely that people who bank in any G20 country are safe, even if they do not as yet have bail-in legislation, as they may be next.
- Should the US and /or the EU replace their paper currencies with plastic debit cards, as has been suggested, those who live in those jurisdictions will have no choice but to rely on banks as the clearing houses for all monetary transactions, once paper currency is eliminated. This, coupled with bail-in legislation would render all personal and corporate funds open to confiscation.
It does appear as though the table is being set for the citizens of all the G20 countries to be subject to legalised theft by their banks and/or governments. The question then to be asked would be, “How can I steer clear of this outrage, either in whole or in part?”
First, it might be wise to establish banking in another jurisdiction where, at the very least, confiscation legislation does not appear to be under discussion.
Second, it might be wise to establish a home base of some sort in another jurisdiction, in order to further diversify your risk.
Third, should you choose to remain in your present jurisdiction either full or part time, it might be wise to retain only three months expense money in banks in that jurisdiction, to minimise the possible loss-level.
Fourth, it might be wise to move a significant portion of your cash into investments that would be difficult, if not impossible, to confiscate. (Those who advise on internationalisation tend to recommend real property and precious metals as the two safest choices. Such investments should be outside of the endangered jurisdictions.)
Fifth, other types of confiscation are planned by some jurisdictions—notably with regard to retirement funds, through the demand that retirement funds be invested in government treasuries and/or bank debt. (It might be wise to move these funds elsewhere internationally as well.)
Sixth, it might be wise to resolve all of the above issues as soon as possible. Once legislation is in place, exiting from confiscatory laws may become impossible. Certainly, as in Spain, there will be no warning offered by governments. One day, you will own your deposit, the next day you may not.
One last note: In robbing Peter, the individuals performing the robbery will not be dressed like the individual in the photo above. They will be wearing suits, and they will present themselves as legitimate authorities, carrying out the law. Unlike a customary robbery, there will be no authority to complain to; there will be no means of recourse. Your wealth, however large or small, will be lost.
Editor’s Note: This story is not surprising. In fact, we predicted it here. And don’t expect this to be the end of bank deposit “taxes” (i.e. confiscations) either. This is only the very beginning. As governments in the EU and throughout the world sink deeper into bankruptcy expect measures like this to increase in frequency and intensity. This is yet another great illustration why you need to have a bank account in a jurisdiction with sound finances. More on that here. Original Source DougCaseysInternationalMan