Greece decides to finally kill off their banking industry...

[HTRN]

by seizing 30% of the deposits over 8k euros...

This will help in the short term.. In the long term? They've just murdered their economy..

[PawPaw]

What can't go on forever, won't.

Eventually, you run out of other people's money.

[Aesop]

And then, the other countries carve Greece up to foreclose the debt, the downside of which is that...oh. nevermind.

[Flintlock Tom]

Does this mean the price of stuffed grape leaves will skyrocket?!

[skb12172]

by seizing 30% of the deposits over 8k euros...

This will help in the short term.. In the long term? They've just murdered their economy..

Now that there is a precedent, how long until they do something similar here?

[HTRN]

They won't. They don't need to, and there's compensation laws involved. It's easier to just tax stuff that previously wasn't, like IRAs and 401ks.

Greece's problem is multifold - they have a long and glorious history of tax dodging, and they can't simply run the presses(like the US has been doing), because they don't directly control the Euro. So, when Germany says "Show some effort or we're turning off the money spigot", they had to do something...

[Vonz90]

Pre WW1, the duties on imported goods into Greece were collected by a French/British /German consortium to pay off Greek debt to the aforementioned countries. This whole dance is sort of a national hobby for the Greeks.

[BDK]

They've tried to implement accumulated wealth taxes in th US - pretty big push for it early on when ObAma came in - it was part of some... Labor reform law? I forgot which one, but lots of capital fled the U.S. As a result.

[D5CAV]

They won't. They don't need to, and there's compensation laws involved. It's easier to just tax stuff that previously wasn't, like IRAs and 401ks.

Ummm. No.

Even that liberal apologist site, Huffpo, points out that bail-ins can happen here.

http://www.huffingtonpost.com/ellen-bro ... 44394.html

Actually, the new G20 bail-in rules didn't make any change in US banking law. If you recall a few years ago, long before these G20 rules went into effect, Jon Corzine, former Governor of New Jersey, and former Chairman of Goldman Sachs, was chairman of MF Global, which was extended on some bad derivative bets and went under. They had used some depositor money to make some of those bets. Not money that depositors had instructed the bank to "invest" in derivatives, but depositor money that those depositors (foolishly) thought was in cash savings accounts collecting interest.

When MF Global went belly up, they went looking for their cash, and it was gone. They sued MF Global and went after Corzine personally. The reason Jon Corzine is not in the jail cell next to Bernie Madoff, is because it is perfectly legal in the US for a bank to use your cash for whatever it thinks it should. If it loses the money, too bad, so sad. Go see the FDIC. If you had more than the deposit insurance, or if the FDIC is bust, too bad, so sad.

Regarding taxing IRAs and 401ks, that is possible, but that will require rewriting some laws, and enacting laws of "attainder". Never mind that "attainder" laws (making something illegal in the past) are unconstitutional, there are a number of attainder laws that have survived judicial review or merely have been ignored by the Supremes (they choose which cases they want to see). Just because attainder laws are specifically prohibited by the Constitution does not make me any less nervous about 401ks and IRAs.

Your bank deposits, however, have no such legal protection. No laws need to be changed. The laws that are in place that allow "bail-ins" and allowed Corzine to get away 'Scot Free' with losing depositor money on the London Baccarat table (aka the Derivatives Desk at HSBC), were on the books since Nixon.

Cash is good. Metal is better. Before you "invest" in precious metals, be sure you have an ample stock of lead and some steel to throw the lead.

[D5CAV]

They've tried to implement accumulated wealth taxes in th US - pretty big push for it early on when ObAma came in - it was part of some... Labor reform law? I forgot which one, but lots of capital fled the U.S. As a result.

Here's a question that's sure to get the discussion going at your next cocktail party "What is the biggest tax haven country in the world by amount of money invested?"

Nope, not Bermuda, not the Isle of Guernsey, not Singapore, not Switzerland. The answer is the USA!

Of course, if you are unfortunate enough to have a US Passport or US Permanent Resident card, you are screwed, but if you are a citizen of, let's say Sweden or Bahrain, living in Singapore (local tax of 10%), your investment income from your Chase brokerage account in New York City is taxed at ... 0%

A friend lives in an upscale expat community in Manila. His neighbors are retired Germans, Swedes, Italians, etc. They have brokerage accounts that generate income for them in the same brokerage houses he uses in New York. He is taxed at 40%. His neighbors are taxed at 0%.

That's the reason so much capital comes to the US. Investments by foreign nationals are not taxed at all.

Yeah, if they started taxing it, a lot of that capital would quickly flee the US.