Cyprus has now been fixed by confiscating up to 40% of the bank accounts that were over $100,000 without touching those that were under and, more importantly, the World did not erupt into chaos in the aftermath of the greatest confiscation of wealth since the French Revolution. If you are reading this and have money in uninsured accounts – this should worry you a lot because the EU, the IMF and the World Bank have now decided your money is not sacrosanct and even the Russians aren't complaining too much and not a peep out of Asia so all this "outrage" you here is just in the countries that are under Rupert Murdoch's sphere of media influence.
Bondholders are being completely wiped out as well and GOOD – that's what happens when you try to take advantage of a bank or country with bad credit by lending them money at usurious rates on the expectation that someone will bail them out. That is why these banks get so out of control – the worse they are managed – the more money pours into them chasing higher rates of returns. If this action is Cyprus simply puts a stop to that – the World will be in much better shape going forward.
This is even more true in the EU, where the people are not convinced that "all they need is a Dollar and a dream" to put them into that top 1% category. The less social mobility we have, the more apparent it becomes to those at the bottom that the game is rigged against them and the more you can expect them to wise up and vote for solutions which include confiscating wealth to solve national problems. And the markets are loving it, with the EU up 1.25% this morning (8:15 EST).
This article will become free after 48 hours (see below for free content). To read the rest of this article now, along with Phil's live intra-day comments, live trading ideas, Phil's market calls, additional member comments, and other members-only features - Subscribe to Phil's Stock World by clicking here.
