Your Saving's Account: One Time Levy ?

[JohnyMac]

There has been a lot of noise out there since the Cyprus levy of citizens saving's accounts earlier in the year. Well I am sure you read that the IMF (International Monetary Fund) was talking about doing the same thing then "tried to talk-back" the discussion. Well it's back!

...Both Harvard economists are not beating around the bush. The idea that the mountain of government debt in the industrialized world is controllable and can be solved over time with enough economic growth is completely unrealistic. Next to that it appears that politicians are suffering from collective memory loss. In Europe and the US, in the period between both World Wars, countries also defaulted. The current mindset that defaults are only reserved for Emerging Markets is completely incorrect, according to Reinhart and Rogoff.

Both economists state that the mountain of debt from the industrialized world is at the highest level in the last 200 years. And that is a problem, a problem which cannot be resolved by economic growth exclusively. The Eurozone's debt amounts to 95 percent of its GDP and the US is almost at 110 percent. Ultimately, the Eurozone is not that far behind at the rate at which debt is growing. You can bicker about the level at which debt is impossible to pay back, but the consensus is that this lies somewhere between 90 and 100 percent for the industrialized world, because of its low growth figures (1 - 2.5 percent)...

http://www.zerohedge.com/contributed/2014-01-12/imf-our-last-wake-call-your-savings

This could never happen in the USofA could it? 

[thatGuy]

It might be what it takes to make people wake up and see the world for what it is..

[JohnyMac]

Yupper TG 

[thatGuy]

Being a broke ass I don't mind the idea personally, I know it is going to hurt a lot of people but welcome to the wonderful world of Fiat Monetary Systems!

[JohnyMac]

What I have heard through the grape vine (RUMOR ALERT) is that the Fed with Government support, is going to hit saving's and checking accounts over the FDIC limit ($250K) to the tune of "unknown percentage."

At first the average joe will just shrug their shoulders as it will not affect them. Once that is accomplished the the Fed/Government will become even more brazen and probably hit your 401K or other forms of retirement.

Pastor Martin Niemoller's poem came to mind:

   

First they came for the Socialists, and I did not speak out-- Because I was not a Socialist.

    Then they came for the Trade Unionists, and I did not speak out-- Because I was not a Trade
    Unionist.

    Then they came for the Jews, and I did not speak out-- Because I was not a Jew.

    Then they came for me--and there was no one left to speak for me.

It's so obvious to me at least, that the Government is trying to drive a "wedge" between different factions of American citizenry. Black against white...Rich against poor...Etcetera. 

[Kentactic]

They already got 33.5% of my retirement when I cashed it out... if they start openly hitting bank accounts for money it would not go over well.  Even if only 2-3% it would cause a big money grab and crash the economy.

They'd be much smarter to just do a random tax hike. No way to pull the money to avoid it.

[DMCakhunter]

Great topic. The Cyprus event was triggered by a bank default and every entity with more than 100,000 euros in their account got a 40% haircut. While the US could default at some time in the future, the real debt owed to entities other than the US government & their various departments (social security, medicare and so on) is around 8 trillion dollars. The debt to the US government departments could be forgiven at any time, granted - not painlessly but easily enough that most citizens would be unaffected. Besides, the current amount of dollars tied up in US savings is $7 trillion, not large enough to risk civil outrage. There are current rumors about the size of all retirement plans in the US, which, at $21 trillion, is a very juicy target for a government that spends more than it brings in. All it will take is another market correction like 2007-2008 and the feds will ride up on their white horse proclaiming that investing is too risky for us peons and the feds will take your account and wisely invest it for you at a gauranteed return of 3% or so, kind of like an annuity. then they can pay you back in inflation adjusted dollars that are cheap to print. This is what you should fear.

[JohnyMac]

First, welcome DMCakhunter to the forum. Please do not forget introducing yourself. ;-)

You bring up very good points. Can you imagine the civil outcry if the US government took a percentage of folks saving's? There would be riots in the streets - The streets of DC that is. Protests would rival the anti war protests in the late 60's and the Bonus Army in the early 30's of the last century.

I too believe that the biggest probability is for the Federal Government to do what you wrote with folks 401K and other retirement accounts post the up and coming "market correction." There is no one that I know that haven't completely moved out of their 401K to other retirement saving plans or cashed them in and taken the tax hit.

In closing I also believe that we will be continually taxed via inflation. Time will tell. 

[Grudgie]

We are all slaves to our respective governments anyway. The money you think you own is just being loaned to you by the government. They can take it back at anytime. Who actually still believes that their government is working for them?

What difference does it make if they tax your income or tax your savings? It's both theft.

[JohnyMac]

Valid points Grudgie. What are you doing to combat the "theft" you speak of?

Grudgie wrote:
What difference does it make if they tax your income or tax your savings? It's both theft.

Your comment reminds me of what Secretary Clinton said:

SHOCK! Hillary Clinton argues - What difference, at this point, does it make about how it happened?

 

[Grudgie]

Equating my comments with what Hilary Clinton said in the context of that video is deeply insulting.

As far as I am concerned they can take whatever they want as a master takes from his slave. I can't grasp how people somehow think this kind of behavior is stealing, yet other forms of tax that have been around forever are justified.

I know you probably agree with lowering the existing tax rates, but it's a bit like the slave pleading with his master to give him less work. The master is only obligated to do whatever he or she wants.

You are saying that taking a little of what I have is fine but taking alot of what I have is stealing.

But I'm probably just an idealistic punk who doesn't know anything about the real world right?

[Grudgie]

It just grinds my gears. Sorry if I sound hatefull. As long as you give credibility to those who take your stuff they can and should take it.

[JohnyMac]

Grudgie,
I would like to express my sincere apology for comparing your comments to Secretary Clinton's. My poor attempt at humor was not meant to insult you.

Equating my comments with what Hilary Clinton said in the context of that video is deeply insulting.

Grudgie, don't get down on your self about your perceived worldly experience or lack there of. You have a lot to offer to this forum.

But I'm probably just an idealistic punk who doesn't know anything about the real world right?