Ok folks, if you live in Cyprus and are one of the common people there, perhaps a “wealthy” person such as a business owner but not one of the “connected few”, now it has come out how you were screwed.
Laiki Bank customers in the UK face no restrictions on access to their cash and have been told it is “business as usual” at the firm’s four British branches, despite an overnight decision to close its Cyprus parent.
Ruth Harvey of Laiki Bank in the UK said that although not all of the details of the impact of the agreement were known, there was no need for the 13,000 UK customers to panic. “We are open, it’s business as usual, and there are no restrictions on our client’s accounts,” she said. “The message we want to get over to our customers is to keep calm and carry on.”
So if you knew this and had the capability, you apparently could have moved all your money out of this Cyprus bank during the freeze.
I am willing to bet that if you are a Russian oligarch with a lot of money (formerly) in Cyprus you did exactly that.
I’m also willing to bet that if you’re a Cypriot citizen you probably didn’t know this and as a result you got screwed since you could only get a couple hundred — or even €100 — at a time from an ATM.
And before you scream “but those rich people deserved it!” let me point out that business people with payroll accounts in these banks are utterly screwed and so are their workers, who worked in good faith and now there is no money to pay them with.
The details of this “program” are as yet not entirely certain, but history is that there is always a way by which the common man gets rooked and the privileged few do not. This time it was blatantly “in your face”; along with the ECB and TARGET2 pledges of which there is no evidence that they will be zeroed along with common holders of bonds or stock it also appears that if you happened to be one of the “privileged few” you were also able to escape being “bailed in.”
Rule of law?
Incidentally, as a former “largish” small-business CEO of a few dozen employees, there is not a snowball’s chance in Hell that I will ever consider setting up another such enterprise until and unless the people who have gotten this unfair advantage are clawed back from and jailed and the rule of law is restored.
Since I do not expect that to happen my response to those who would like me to deploy capital and set up another employment-producing business is best-expressed by this: