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Friday, March 29, 2013

Currency Shenanigans



Shenanigan is a nice Irish sounding word. I use it in honor of those Irish savers who've already taken a major haircut from their banks.

Plenty of shenanigans going on in Cyprus. It looks like some major Russian depositors have taken it on the chin. For every one of them many thousands of regular people are being ripped off. I tried to imagine how I would behave if something like this happened in the United States.

If my savings were taken or even just make unavailable due to daily withdrawal restrictions, I'd have to do something. If I had limited access to money, the last thing I'd do is pay any debts owned to banks. I wonder if they've thought of that? I bet a lot of Cypriot credit card bills are not getting paid. That can't be good for the banks. Of course, local banking is probably a very tiny part of the banks business. Apparently most of the depositors were of foreign origin. Screw the foreigners first and hardest, but put it to everyone sooner or later.

Tricks that worked in Ireland and Cyprus probably won't work in Spain or Italy. No doubt the creative financial gnomes have new tactics for different countries.

Unless things go seriously sideways, bank holidays like those that just took place in Cyprus probably won't happen in the US. My guess, and it's really only a guess, is that we won't have to deal with the same sort of currency restrictions. Besides, there probably isn't a big enough pile of money in US savings to rob. Pension funds are big enough to rob. Some collusion between government and big banks could vacuum those up -for our protections, of course.

We've really got to find a better way to make money work. If we don't we'll be bartering eggs for firewood sooner or later.

-Sixbears

13 comments:

  1. Um... Sixbears... about that last sentence.... I hate to tell you this...

    There really are only two possible eventual outcomes:
    1.) The supply of money goes to zero.
    2.) The value of money goes to zero.
    Can't tell you which, can't tell you when. But we are always heading towards one outcome or the other, UNLESS loaning money at interest is banned.


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    1. Interest can only be covered in an expanding economy, and that's unsustainable.

      . . . got any eggs?

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    2. The coincidence of my day being that I read this immediately after gathering a dozen eggs from the dozen hens we have! Ha!

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    3. Well there you go. At least you've got eggs. :)

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  2. Just for the record, I've read that it was technically illegal for ancient Jews to charge one another interest. They COULD charge gentiles, but only one percent. I don't know if that's true or not, but I once found something in the Bible that sort of looked that way.

    P.S. - Barter is best, anyway, when possible.

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    Replies
    1. It's still illegal in Islam. Their banks work differently than banks in the West.

      I like barter and gift economies, but it limits what you can do. Trades can get really complicated when trying to run a modern economy. Russia had these elaborate multi group trades to get anything done after the USSR fell.

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  3. Actually they already are robbing us and have been for some time. Cyprus and other Euro countries cannot just print on demand as we have been doing.
    The theft has been going on right under our noses for some time now....

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  4. True. They've been inflating the value of money away for years. Lately they've picked up the pace of robbery.

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  5. I do believe we can do almost anything using the barter system and an absence of greed...

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  6. as stated here or there "why save your money in a bank?"

    well, you need a certain sum for check payments or credit card bills; but at least you should keep cash on hand for days you need it....

    as for pensions including fannie maes and 401k's state and federal governments are trying measures to invade accounts for "our own good" as if thet are any better at "managing money, hah!

    there is allready talks of cyprus like monkeeing for brazil. spain, and france in the works

    have fun on the road to hell...

    Wildflower

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    Replies
    1. Hadn't heard about Brazil. Thought they might know better, being a rising nation.

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  7. Yep, I've been pretty stressed about what's going to happen to my 401K. My husband's all when POOF when MCI collapsed, so it's all we've got if we ever retire (and it's not a lot, but it could buy some land and chickens, maybe). Trying to decide if it's worth it to take the 40% hit by taking it out now, or hope it's still there in 5 years when I turn 60.

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