Cyprus banks may collapse on Monday
Mar 22, 2013
Here is a good article that confirms what I have been writing all week. The only positive thing about this is that we in America will not be the first ones to be hit. Whatever happens in Cyprus will spread to Greece, Italy, Spain, and Portugal. By that time, the EU itself will be in trouble, and only then the US banks will feel its full effects. So watch the news, and don't be caught by surprise.
(NaturalNews) As you may have suspected, there's far more to the Cyprus bank crisis story than meets the eye. It turns out the shutdown of Cypriot banks has caused a large-scale financial shutdown of the Russian government which uses Cyprus banks for most transactions....
USA Today reports, "If it does not find a way by Monday, the European Central Bank said it will cut off emergency support to the banks, letting them collapse. That would throw the country into financial chaos and, ultimately, cause it to leave the eurozone, with unpredictable consequences for the region."
Until then, the banks remain closed, and everybody knows the minute they open, every account holder will immediately transfer their money out of the banks, causing a near-instant bank run and a collapse.
The worry across the eurozone now is that this imminent bank collapse will trigger account holders in Greece to start taking their money out of the bank, too. The Greek banking system is already in such sad shape that it only takes a very small percentage of account holders withdrawing their funds -- perhaps 5% or so -- to topple Greek banks. That's because the banks are roughly 95% leveraged with fractional reserve accounts and complex debt instruments.
Once bank runs begin in Greece, they will spread across the EU. Fear will kick in everywhere and depositors will run on the banks in Spain, Italy and even the UK. Germany is arguably in the safest position to defend against bank runs, but even its banks are unwisely leveraged beyond reasonable ratios....
Dr. Stephen Jones