Cyprus Central Banker Says The European Project Is Dead! + This Plan to Seize Bank Accounts was Proposed Two Years Ago + UK MIC sends plane-load of cash to Cyprus for its loathed land thieving colonial troops

Joe Weisenthal: Former Central Bank of Cyprus chief Anthanasios Orphanides was on Tom Keene's show on BloombergTV this morning. In his interview, he goes off on the EU for its treatment of Cyprus, and says the European project is dying.

Below is a partial transcript provided by Bloomberg TV.
Orphanides on Cyprus bailout bankster theft:
"We are witnessing historic times. What we are witnessing is the slow death of the European Project. We are in a situation that some European governments are essentially taking actions that are telling citizens of other member states that they are not equal under the law."
"What we have seen in the last few days is a very serious blunder by European governments that are essentially blackmailing the government of Cyprus to confiscate the money that belongs rightfully to depositors in the banking sector in Cyprus. It is not clear how this can affect in a positive matter the European project going forward."
On EU making a mockery of Banking Union
"Cyprus did not have a problem before earlier blunders that were made by European governments."


"We have had decisions taken by the strongest government in Europe that is spreading misery sequentially to citizens in Greece, Ireland, Portugal, in Spain, in Italy and this is not going to end the way that European governments are handling this. We need to have a decision making process where governments are asked to care for citizens in other states."
"In order for the EU area to stay together they needed to form a banking union which meant, they needed to have a common credible deposit insurance guarantee for everybody in the EU area. Indeed by making a mockery of that right now, the governments who pushed for this measure are sending a message that they want no part of a banking union."
On the possibility of bank runs across Europe
"I would hope not… we have finance ministers from a number of countries who should have known better and they have taken a decision that has encouraged bank runs across Europe."

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This Plan to Seize Bank Accounts was Proposed Two Years Ago

By Martin Armstrong: The Swiss banking regulator previously published a paper two years ago proposing that to rescue the bankers in Switzerland the solution is to also just take money from accounts. This demonstrates what I have been warning about. ANYONE who has a career in government looks upon the people as absolute economic slaves. They stand up and pretend to care – but it is all bullshit. They care ONLY about maintaining power. Homeland Security does not need 1.6 billion of hollow point bullets that are illegal nor more than 2700 tanks to patrol our streets if they really cared about the people and were true REPRESENTATIVES. It is John McCain and Lindsey Graham who see no problem using drones against American citizen within the United States. These two guys have OVERSTAYED their welcome and these types of people have NO INTENTION of trying to fix anything – they simply want to maintain power they do not deserve.
Government is only for itself – not for the people. This paper shows even in Switzerland two years ago what has taken place in Cyprus has been on the drawing boards of bureaucrats for a long time. Germany and the ECB, its pawn, knew this option existed all the time and just pulled the switch. There will be no social retirement. These people cannot pay the promises they have made.

http://insideparadeplatz.ch/2013/03/19/wer-schuetzt-ubs-und-cs-sparer-vor-enteignung/
Who protects against expropriation UBS-/CS-Sparer? Finma paper speaks of “bail-in” of all creditors – Cyprus supplies example, Switzerland would act the same?
19th March 2013 / 07:59
Cyprus is the Fall. First time savers are forced to bail out the banks.
This raises for Switzerland with their two oversized big banks a central question: Who is standing for UBS and Credit Suisse, if all else fails?
The point is aimed at the attitude of the government that UBS – and probably also the CS – to save, no matter what the cost.
Whether this should also apply to the new, from the Cyprus case triggered the future, must decide the Financial Market Authority (FINMA).
Theoretically, it has already done so.
“The Swiss SIFI policy” is the cryptic title of a 19-page-paper Finma of 23 June 2011 of the regulator.
It is about the rescue of UBS and CS as a “global systemically important financial institutions (G-SIFIs)”, both of which are “too big to fail” (TBTF).
With two SIFIs is the theme “of great relevance” for Switzerland. Neither UBS nor the CS can let go under the State without the consequences would be dramatic.
That holds true today.
Together, CS and UBS accounts that make still about four times the entire Swiss economic output (GDP). Both remain TBTF.
On page 13 of its “Policy” Finma comes in a hitherto largely ignored short digression on “bail-ins” to speak.
It is to that concept, which now comes in Cyprus to apply and set up to rescue the ailing banks of the Mediterranean island from destruction.
In contrast to bail out with external rescuers zeroing mostly fresh equity or take on illiquid assets that are forced on bail in the existing creditors to waive their claims in part or entirely, to prevent the bank from insolvency.
The Swiss FINMA will Bail-ins seductive.
“In theory, the concept is elegant”, held the authority finds almost 2 years.
So that it could “The Possibility of a TBTF banking failure” are eliminated completely, “as it could employ bail-ins to generate Sufficiently capital”.
Theoretically, the problem would be resolved according Finma: If all donors, ie shareholders, bondholders, and in the end even the savers had to contribute, then the taxpayer would never bled.
In practice Finma made in their “paper” restrictions.
A large part of the debt would not be a bank for bail-ins available, wrote the Bernese authorities.
“This especially holds true for big retail banks, Which to a large extent refinance themselves by deposits (insured or uninsured).”
The savers were therefore excluded from a verordeneten by the state bail-in.
In addition to the shareholders with their venture capital therefore remained only the bondholders – but not all.
To make the construct weatherproof, lenders would have to be put in the picture about their risks.
These bondholders would need to know from the beginning, “that their claims can be bailed in”.
The result would be an “opt-in” policy. With special bail-in bonds as the known Cocos (contingent convertible)
In conclusion, wrote Finma that Switzerland had a “bail-in mechanism in its Swiss SIFI framework” built, but these would be limited for the moment to Cocos and other instruments with specific triggers (“triggers”).
That could change, and that at an international consensus on a cross-border bankruptcy liquidation of big banks, said the financial system.
With their regime, Switzerland is considered a pioneer in the global banking regulation. More significant is the Helvetic digression on Bail-ins.
Finma waived a clear statement whether the worst-case “beaten” the savers of UBS and Credit Suisse to rescue would.
The two big banks is the zupass. They continue to enjoy the privilege of being regarded as institutions that are protected from destruction.
This affects in lower risk premiums, ie lower interest rates from.
For the savers of UBS and Credit Suisse – both still hold great investment banking risks on their books – Finma Blur is however unpleasant.
Even the guaranteed deposit 100,000 francs could turn overnight. Cyprus has shown that.
If even the Swiss savers are no longer safe in front of a compulsory contribution to the big banks bailout, should Finma clarity.
Are you big banks so important that they even the deposits of individual savers risking?
If not, why then they allowed the big banks continue to huge budgets?

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UK sends plane-load of cash to Cyprus for its troops
Cyprus Mail: BRITAIN said on Tuesday it had sent one million euros in cash to Cyprus aboard a military plane for its troops on the island in case cash machines and debit cards stop working. "An RAF flight left for Cyprus this afternoon with €1m on board as a contingency measure to provide military personnel and their families with emergency loans in the event that cash machines and debit cards stop working completely," the Ministry of Defence said in a statement.

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edited by WD 

Update 23-3-2013

Former Cyprus Central Bank Head And Senior Fed Economist: "The European Project Is Crashing To Earth!"

Submitted by Tyler Durden: Back in August 2011, one of the most prescient European (ex) central bankers, Cyprus' very own Athanasios Orphanides was optimistic, but with a caveat: "I am optimistic that with the right actions and effort by all we will pull through this," Orphanides told reporters after a meeting with Finance Minister Kikis Kazamias. They were Orphanides' first public comments since warning authorities in a July 18, 2011 letter that Cyprus ran the risk of requiring an EU bailout unless urgent action was taken to shore up its finances." 
Two years later, following endless dithering and pretense that just because the ECB has stabilized the markets, all is well, and "action was being taken" when none was (because in the New Normal the lack of market collapse is somehow supposed to represent structural changes are taking place, which never actually happen), Cyprus is beyond the bailout stage - it is now quite literally on the verge of total collapse. This is also why Orphanides, who recently (and perhaps prudently) quit as Central Banker of Cyprus following a clash with the new communist government (and was replaced by a guy named Panicos), no longer is optimistic. "The European project is crashing to earth,” Athanasios Orphanides told the Financial Times in an interview. "This is a fundamental change in the dynamics of Europe towards disintegration and I don’t see how this can be reversed.”
It can't. Which is what we have been saying all along. But it apparently takes a former Federal Reserve senior economist to say the perfectly obvious, and for reality to finally hit front and center.
More from the FT's interview with Orphanides:

This week’s events had made “a mockery” of EU treaties, he added. “It suggests that in Europe not all people are equal under the law.”

“We have seen other eurozone countries, the Netherlands, for instance, put national interests ahead of the European interest by trying to bring down the economic model of countries such as Cyprus or Luxembourg.”

He also called into question the credibility of the ECB’s threat to pull the plug on the Cypriot banking system. On Thursday, the ECB warned that if an EU-IMF rescue programme was not agreed by Monday, it would ban the use of “emergency liquidity assistance” to prop up the Cypriot banking system.

According to Mr Orphanides, about €10bn of ELA is being provided via Europe’s Target2 payments system used by its central banks. “If you say it is no longer authorised, it would force the Central Bank of Cyprus to default on its Target2 obligations. Cyprus would then have to leave the euro area.”

“The ECB will have forced Cyprus out. This is the one thing Mario Draghi doesn’t want to happen – he does not want to be the ECB president who triggers the break-up of the euro. It is painful to watch.”

So far, global financial market reaction to the Cyprus crisis has been subdued. But Mr Orphanides warned that would change. “I don’t think that the full extent of the shattering of the trust that we have seen in this case . . . has been seen fully yet.

“Banks’ funding costs in the [southern eurozone] periphery will rise further – there is no way we will avoid that. This, in turn, will make the recession in the periphery deeper, adding to the misery that the mishandling of the crisis has caused so far.”

“Financial markets are over-influenced by what happens in London or New York – there, the intricacies and processes of European politics are not very well understood.”

We couldn't agree more.
As a reminder, Mr Orphanides was governor of Cyprus’s central bank from 2008 until last
year, when he was replaced after clashing with the island’s then
communist government. As member of the ECB’s governing council, Mr
Ophanides’ views were respected because of his background as a senior
economist at the US Federal Reserve. He has since returned to academic
economics in the US.
We can't wait until the world of very serious economist, some of them even with Nobel prizes, turn on one they proudly praised as their own, as recently as months ago.
In the meantime, Orphanides is absolutely correct. 

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