Friday, March 29, 2013

"When it becomes serious, you've got to lie"

When it becomes serious, you have to lie." -Jean Claude Juncker
President and Finance Minister of the European Union

The following letter dated February 11th, 2013 was from the Cyprus Central Banks to bank CEO's and posted by Zerohedge:

I'm pretty sure its safe to say now that there was, in fact, a "Radical rescue proposed for Cyprus" and that the rights of depositors were reduced, deprived and restricted and outright stolen from Cypriots.

The letter is right about one thing: protecting property rights are crucial to the functioning of a free market economy. Sadly, as we have seen around the world since 2008, free markets and property rights are a thing of the past.

 John Demetriou was one of those Cypriots whose wealth was stolen:

''Very bad, very, very bad,'' says 65-year-old John Demetriou, rubbing tears from his lined face with thick fingers. ''I lost all my money.''

John now lives in the picturesque fishing village of Liopetri on Cyprus' south coast. But for 35 years he lived at Bondi Junction and worked days, nights and weekends in Sydney markets selling jewellery and imitation jewellery.

He had left Cyprus in the early 1970s at the height of its war with Turkey, taking his wife and young children to safety in Australia. He built a life from nothing and, gradually, a substantial nest egg. He retired to Cyprus in 2007 with about $1 million, his life savings.
"I went to sleep on Friday as a rich man, I woke up a poor man."
If John had put some of his money in gold in 2007 when gold traded in the $600's he not only would not have lost all his money but would be able to sell it today at about $1,600.

John never thought his bank deposits would have counter party risk. One convenient aspect of gold is that it has none.

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