ALLIANCE FO§ DEMOCRACY

EDITORIAL – also published 28th of March 2013 at >facebook

Dear Readers,
the tax haven of Cyprus, which allowed good safekeeping of funds of investors mainly from Russia, Greece or England at low interest rates, could not be allowed to go under, but could also not save itself on its own. The country was threatened with national bankruptcy, with resulting uncontrollable consequences on the stock exchanges. The Euro would have lost so much value within a few hours that it would have been questionable how these losses could have been compensated for. The ECB, the IMF und the Finance Ministers of the Euro countries therefore decided to grant the Cyprus banks a loan of € 10 billion (German share € 2.7 billion), in order to be able to monitor and control the currency.
Loans provide only temporary aid. They require a settlement of the debt. € 10 billion however is an amount which can never be settled, especially when a country has hardly any prospect of coming up with this amount. The lenders, the troika of the ECB, IMF and European Commission believes that Cyprus can come up with this amount by means of various charges and levies (banks, taxes, citizens’ accounts, liabilities of other Euro countries). This is however impossible, and the normal citizens will also have to pay further charges. It is clear that this aid will have only a short term impact, and will in fact rather exacerbate the crisis.
Although the Euro Finance Ministers are adhering to EU law and do not want to interfere with the compulsory levy on bank accounts of up to € 100,000 (as well as pension funds), it will also affect those very account holders, because the Euro is losing value, and on the other hand it is a matter of invested funds, i.e. returns, which will now disappear. Speculators, money launderers and fraudsters will also lose by this move, which is perhaps the only result to be welcomed.
It is a shame however that there is no more talk of a speculation tax; checks on whether money-laundering systems are being operated in Cyprus will be brushed under the carpet, and privatizations due to go ahead will probably never take place. Small savers will therefore have to keep paying for the damages, while fraudsters and the rich simply move their funds to other tax havens. Cyprus will thus hardly be able to get back on its feet, and since it has now been established that the gas deposits are of only minor economic value, the state of Cyprus will from now on continue to be a drain on the resources of Euro Europe. And the loan debt will become more burdensome for all.
One of the two national banks is to be closed and wound up; the investments in the second bank will initially be frozen, in order to pay for this winding-up process. This will be anathema to investors hoping for returns, because they will only be able to get at parts of their as-sets, and there is no telling when they will see all of their money again. Things will be hard for the Cypriots in the coming times.
The person most happy about any agreement in these times must be Angela Merkel. On the one hand she has created confusion with her demand that balances up to € 100,000 should be sacrificed for the rescue to the tune of 6.75% (and all without putting the question to the investors or other decision-making bodies in Europe, such as the EU Commission, the German Parliament etc.); on the other hand she has guaranteed to savers in Germany that their investments will remain untouched. She may have been a little ahead in her thinking, and believed that she already governed Europe, because as Chancellor of a country, she cannot make such commitments for any other country. If it were possible with formal legal discretion, all savers who believed in this guarantee could now claim compensation from her, be-cause a guarantee, as Merkel announced, also applies if the crash does not occur, and the currency takes the reverse course. As stated, € 100,000, less 6.75% which is taken away from savers by the banks in order to save the country from bankruptcy, is no longer € 100,000. The difference would have to be paid by Mrs. Merkel, since it was she who gave a guarantee for this € 100,000.
Mrs. Merkel, we wish you a pleasant private insolvency – and the guarantee, you should not have been allowed to give it. You have nothing to say in Europe on this matter. And for us Germans, one thing is clear: If Germany once goes bankrupt, which is certain, we also have no confidence in your help. Nor in any other matters. Nor in Mr. Steinbrück, even if he makes the same guarantee, but no longer to the full extent, because a tax on something has nothing to do with a levy which will be applied in any case, because this tax is subject to the will of those who gave the guarantees.
This was clearly recognized by the “world economist”, but it will mean all the less for the savers, while the Euro powers have also intervened without authority and from a popular perspective, savers must be able to be sure that guarantees apply whether the Euro crashes or not.
Judged according to common sense, Mrs. Merkel can be happy that this subject has been abolished by the Cypriot Parliament, because now she – as well as Mr. Steinbrück – can no longer be accused of trickery, and has in this way been revealed as offering little support for Christian considerations.
The bottom line is: Our savings and investments are not safe. They never were, and now we know it.

MESSAGE II – also published 25th of March 2013 at >facebook

Election promises are often slips of the tongue, as Angela Merkel proved once again lastly on 25th March 2010, when she announced that there would be no financial aid for Greece, and all of this just a few hours later to approve the aid package for Greece intended by all heads of state and government of the Euro zone countries.
Government heads should not cause such confusion, because it reduces one thing above all else: the confidence of the voter in a European policy that pretended to want to preserve the Euro as a stable currency.
With their consent to aid for Greece, the heads of the Euro countries violated the self-imposed, so-called no-bailout clause of the Maastricht Treaty designed to secure the stability of the currency, which states that no country should provide another country with financial assistance if it gets into financial trouble, simply in order to maintain the stability of the Euro system.
This was more than a slip of the tongue, it was a betrayal of trust in European policy leading to the Euro fiasco which we have today; the next was the ratification of the ESM/Fiscal Pact, which set aside the budget sovereignty of the German Bundestag, thereby making a parliament superfluous.
In addition to all these great obfuscations, which have increasingly reduced confidence in the work of the Chancellor, this guarantee of savings is yet another breach of trust, particularly when it is represented as a special case, simply to reassure nervous and anxious German savers that Cyprus is far away, and what applies for savers in Cyprus does not apply in Merkel’s domain.
You are far off the mark, Mrs. Merkel, because apart from the fact that such a guarantee has no legal substance, and is no more than a sort of private promise by a Chancellor, but has neither been approved by a parliament nor supported by our European partners, this promise is not a special case, but a trick, because the financial affairs of Europe are all interlinked. The same fate will overtake every saver in every country, because a debt union, i.e. countries that are connected via mountains of debt, is moving daily towards the loss of purchasing power of the currency. It is therefore questionable how any guarantee on € 100,000 of investments can be given, when they will no longer be worth as much as early as tomorrow?
Such promises are actually lies - at least when regarded between people, because if somebody makes a promise to someone which they know they cannot keep, it all ends at the very best with a bloody nose for the liar - although on the political level such fabrications still remain unpunished. This at least should be reviewed and corrected.

URGENT MESSAGE – also published 25th of March 2013 at >facebook

With regard to the statement of Angela Merkel, that the savings of Germans were safe, and that this was guaranteed by the Chancellor (for the 4th time, by the way), it can only be said: This is a lie.
Nobody can give a guarantee on this matter, not even Merkel, the savior of the Euro, because after a crash, no German citizen (including the Chancellor herself) would have any chance of getting their money back on the basis of this guarantee given by the Chancellor.
To this extent the announcement from Berlin is nothing more than an overhasty reaction to a hyper-nervous Chancellor, who is increasingly losing her grip on the supposed rescue of the Euro, and who is concerned with one thing above all else: her interests are in danger.
This monstrosity is compounded by the fact that there are firm links between the Cypriots and the Germans: All the countries of the European Finance Union have been deceived both by their governments and the ECB. Cyprus is no less bankrupt than Germany; the money that we Germans have to pump into the rescue packages comes from the tax system, and the funds will be used for the clearly hopeless rescue of a currency that nobody should have had to accept (the United Europe was achieved with the Schengen Agreement), instead of funding needed reforms and other support.
These payments do not help Cyprus, nor do they help Greece. Finally it will come to the point that we Germans, in addition to all previous payments to a hemorrhaging Europe, will be asked to pay up once again, when the Euro has been more and more devalued.
Our sincere sympathy goes out to all Cypriots, as well as to all the countries of the Euro community.
We therefore call once again for an immediate stop to the Euro rescue, and from the Merkel government, we call for openness about the total bankruptcy of the debt union and immediate currency reform, instead of unsustainable guarantees.