ZeroHedge.com is a must for anyone who wants to know what really is going on in the world of finance.
In a post from today titled “Have The Russians Already Quietly Withdrawn All Their Cash From Cyprus?” you really get the sense that the rich will always win and the “Average Joe” will be the one that gets screwed first, middle and last.
Remember OWS? How did that change the world?
Well it didn’t and the upper powers know that. We may bleat like sheep for a few months about the injustices but ultimately we forget and go back to the mindless reality TV shows.
For those of us that don’t forget and learned from this we understand that we cannot change the world no matter how many public parks we take over for a few weeks – we have to adapt our actions to either take advantage of the situation or get out of the way.
Yesterday, we first reported on something very disturbing (at least to Cyprus’ citizens): despite the closed banks (which will mostly reopen tomorrow, while the two biggest soon to be liquidated banks Laiki and BoC will be shuttered until Thursday) and the capital controls, the local financial system has been leaking cash. Lots and lots of cash.
Alas, we did not have much granularity or details on who or where these illegal transfers were conducted with. Today, courtesy of a follow up by Reuters, we do.
The result, at least for Europe, is quite scary because let’s recall that the primary political purpose of destroying the Cyprus financial system was simply to punish and humiliate Russian billionaire oligarchs who held tens of billions in “unsecured” deposits with the island nation’s two biggest banks.
As it turns out, these same oligrachs may have used the one week hiatus period of total chaos in the banking system to transfer the bulk of the cash they had deposited with one of the two main Cypriot banks, in the process making the whole punitive point of collapsing the Cyprus financial system entirely moot.
Okay so how did the wealthy Russians get their cash out of Cyprus while all the banks are closed?
While ordinary Cypriots queued at ATM machines to withdraw a few hundred euros as credit card transactions stopped, other depositors used an array of techniques to access their money.
No one knows exactly how much money has left Cyprus’ banks, or where it has gone. The two banks at the centre of the crisis – Cyprus Popular Bank, also known as Laiki, and Bank of Cyprus – have units in London which remained open throughout the week and placed no limits on withdrawals. Bank of Cyprus also owns 80 percent of Russia’s Uniastrum Bank, which put no restrictions on withdrawals in Russia. Russians were among Cypriot banks’ largest depositors.
So what have I learned through the whole saga of 2008 leading up to today?
As the average Joe you will always be screwed first, you will be lied to by both media and governments and the rich always win.
What does that mean as a small business owner?
Keep your head down and make sure you don’t have too much cash in the bank.