This is hysterical. The haircut is equivalent to one year’s interest. Insured deposits lay 4 to 6 percent. In order to attract all that Russian money, Cyprus banks were offering up to 11% per annul on uninsured jumbo deposits of EUR100,000. We’re so used Stateside to bank deposits paying sub 1 percent that we think this action is near confiscatory.
You can bet your life that there is a Democratic think tank in Washington talking about this and how they can do it...will an executive order be enough...they are thinking what an easy way to redistribute money....
I hope they pay you well.
It doesn’t matter what interest rate Cyprus banks are paying. You can’t change the terms of the deal like this.
If investor knew ahead of time that they’d be depositing money for a 11% interest rate and a possible 10% tax at some future point, fine. That’s not what is happening.
Tell you what - go to a restaurant tonight. Order a $30 meal. When the restaurant then tells you AFTER you ordered and ate that all prices have gone up 10%, how do you feel? It’s fair?