Search This Site:

Daily WebLogs


Email, Print, Share. CLICK HERE.

Canadian banks prepare for Cyprus solution

Apr 29, 2013

http://www.cbc.ca/m/touch/news/story/2013/04/02/f-rfa-macdonald-canada-cyprus-banks.html

Buried deep in last month's federal budget is an ambiguously worded section that has roiled parts of the financial world but has so far been largely ignored by the mainstream media.

It boils down to this: Ottawa is contemplating the possibility of a Canadian bank failure — and the same sort of pitiless prescription that was just imposed in Cyprus....

If that sounds sobering, it should. While officials in Ottawa are playing down the possibility of a raid on the bank accounts of ordinary Canadians, they chose not to include that guarantee in the budget language....

It may well be true, even if Canada's six-bank oligopoly isn't terribly competitive, at least in comparison to the far more diverse American banking universe.

But in the ever-more insecure world that has unfolded since the financial meltdown of 2008, it is also increasingly clear that nothing is safe anymore, not even blue-chip bank stocks and bonds or even, in the case of the Cyprus bail-in, private bank accounts.

And now, Canada is making a bail-in official government policy, too.

COMMENT: It appears that the Canadian government is leaving its options open to do a Cyprus-style solution. In other words, in case of problems, bank depositors will find their money used to purchase shares in the bankrupt bank in order to keep it from failing. If the government is leaving those options open, then depositors might also take steps to defend themselves. Unless, of course, they don't mind being forced to purchase stock in a failed bank.

One wonders how many other countries are quietly putting such policies in place. The trap is being set and covered over with leaves. The only question is who will step in it?

 


2017 Tabernacles Conference Details
[Click To Expand]
2017 Passover Conference Videos
[Click To Expand]
Notices From GKM Admin
[Click To Expand]
Daily Weblogs
[Click To Expand]


Tags:
Category: Financial

Dr. Stephen Jones


Add Pingback