By announcing a plan to confiscate 5-15% (the number is still undecided) of all bank deposits held in Cyprus, the EU has opened a Pandora’s box of geopolitical, and monetary problems which will change history.
At this point, why would anybody trust to keep their money in a European bank? Especially, Italian, Spanish – PIIGS banks?
And by extension, to have confidence in the Euro currency?
It is estimated that half the affected deposits in Cyprus are from Russians oligarchs, mafia, ex-KGB and other groups who do not like to be robbed or made fools of. Vladimir Putin, estimated to have billions of dollars stashed away in hidden accounts worldwide, will surely be taking a hit. It will be interesting to see how this affects Russia/EU relations, and if there is a sudden spike in polonium, and other radiation poisonings in Brussels…
All those crazy “conspiracy theorists”, stockpiling guns, canned food and gold may not be so crazy after all…
With the Rape of Cyprus, the European Union has clearly demonstrated that it is no longer safe to hold money, or other paper assets which can be seized at the whim of government officials. Instead, the only sensible thing to do with your hard earned savings is to keep them in the form of physical gold at home. AND to have enough assault weapons, and armor piercing ammunition to stop the government officials who come to confiscate your gold.
Bottom line: Bullish for gun stocks, gold, long term bearish for Euro and European financial institutions.