Could it happen here?

From one of my favorite investment blogs:
 
Shock waves went around the world when the IMF, the EU, and the ECB not only approved but mandated the confiscation of depositor funds to "bail in" two bankrupt banks in Cyprus. A "bail-in" is a quantum leap beyond a bailout. When governments are no longer willing to use taxpayer money to bail out banks that have gambled away their capital, the banks are now being instructed to "recapitalize" themselves by confiscating the funds of their creditors, turning debt into equity, or stock, and the "creditors" include the depositors who put their money in the bank thinking it was a secure place to store their savings.  The Cyprus bail-in was not a one-off emergency measure but was consistent with similar policies already in the works for the U.S., U.K., EU, Canada, New Zealand, and Australia, as detailed in my earlier articles here and here. "Too big to fail" now trumps all. Rather than banks being put into bankruptcy to salvage the deposits of their customers, the customers will be put into bankruptcy to save the banks.

Go to the blog for the rest of the story.


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