Cyprus bailout = money shift to tangible assets (gold, silver, etc...)

Like the USA gov't the EU punishes savers....

 

Log in or Sign up to hide this ad.

Gold price in Cyprus in Euro (EUR) = 40.10 EUR
http://goldpricenetwork.com/goldprice/cyprus/

No different than anywhere else, apparently. A website for NORTH Cyprus (the Turkish part) says "Gold and silver covers most of the shops in the centre of the major towns in North Cyprus. The prices are reasonable and the designs are unusual. The pieces of gold and silver are usually weighed before being sold."

I found nothing online to suggest/prove that Cypriot PM bullion prices are now trading at any higher premium. This is not what a 'Paper currency panic' should/will look like.

INSTEAD, the headlines are this: "Gold Falls to One-Week Low as Cyprus Deal Cuts Haven Use." Is there ANY evidence otherwise??? Pics (coinshop windows) or it didn't happen lol

 

Gee, then why didn't gold jump to record highs if the Cyprus action is leading to the EU downfall, and the USD demise?

Why does the USD remains strong, Euro is very stable, although low to the USD, Looks like the world doesn't think the same way as bullion bulls. Oh, lets not confuse with facts, sorry. Yes, the world doesn't recognize the invisible secret value of PM.

-sorry typing while juan was posting the above.This post was not in response to his, but agrees mostly.

 

Well, not sure about RECORD HIGHS in London or New York - but at the very least in Cyprus - "where is the news" at coinshops and gold bazars????
**crickets**

I remember when the CAD$ hit a high against USD$ in Fall 2007 ... and there were literally HOUR-LONG LINES AT THE BORDER (frenzied shoppers) and in currency lines in front of forex shops of downtown Montreal. (That was no panic, either.) Parity was big news .... http://www.nytimes.com/2007/09/22/us/22shop.html

See, a "panic" must witness some abnormal activity, like Gold shops getting cleaned out by hordes of desperate savers or posted PM premiums skyrocketing... YES it WILL be televised (blogged, instagram'd, etc.) when it happens.

I've seen nothing of note, in this "crisis." Please show us the evidence, otherwise. Or is this another CONSPIRACY of the MSM (successfully hiding from everyone in the world) a PM run in Cyprus???? :rollling:

 

Just playing a PM advocate, isn't it kinda hard for there to be a run on gold in southern Cyprus if the banks are still closed?

 

Are you assuming everyone there keeps every single Euro-cent in the bank? (Given this obvious bank holiday, would you?)
Do you imagine that (Greek-speaking) Cypriots don't know what a bank holiday is?
Or that coinshops have been closed by martial law???

AGAIN: please provide evidence for that.

 

There's been no run, no panic, nor will there be.

The Euro is going to pull through. Ask the people who would be most affected by its collapse, not some PM peddlers from the US and Canada.

Since the Cyprus thing started, gold has not spiked. The market was telling you something.

 

Are YOU assuming people keep piles of cash laying around the house? How many ounces of gold could you buy from cash on you? I might be able to scrounge up half an ounce, and that is because I am stupid and keep a little in my wallet for emergencies. Most people would be hard pressed to buy an ounce of silver with their cash on hand.

I read the stories as if the accounts are frozen. Given that, I feel MOST people would be extremely short of any cash right now, and sure as heck would not wish to waste it on PM. They need to hoard any cash they have to eat until the banks are opened again.

If without notice the US did the same, and you had say $300 on you, are you going to go running to buy as much PM as you can afford, or will you keep this $300 to buy food and essentials until the banks are reopened?

 

The weekend mall shopping frenzy was evident, and here's reference to the 1974 Cypriot bank holiday:
http://www.guardian.co.uk/world/2013/mar/23/cyprus-crisis-russians-euro-europe-eu

People remember that. No mention of mobbed coinshops or local Gold premiums exploding now, though.

**crickets**

 

I made a poll to test your notion on the Cointalkers, medoraman.
http://www.cointalk.com/t225040/

 

I never SAID I agreed with the OP Juan that this would have a quick effect on PM prices. I was just playing devil's advocate and saying it would be too soon what affect it would have, if any.

Cyprus does not have enough money to wad a shotgun. The affect of such a bank seizure, though, would be if it makes other depositers in EU countries, like Spain, Italy, France, nervous, and for THEM to start systematically putting more money aside in non-seizable assets. That would be the affect. In no way can Cyprus, especially with their cash frozen, affect the PM market.

I would be willing to wager, though, that a year from now if you polled Cypriots that a larger percentage of their assets will either be offshore accounts or in hard assets.

Does this matter to PM prices? IDK, since Cyprus is so tiny, probably not. Its only the psychology to others in the Eurozone that could affect PM demand.

 

You wrote:

That's an excellent question to put to the forum. I did. No need to get defensive.

To paraphrase you "{in} a year from now, it's very likely a significantly larger percentage of Cypriots' assets will either be offshore accounts or in hard assets"

Well what you wrote is very waffle-y and vague but I agree that more Cypriots will probably hold +Ag/Au, YES. We'd need baselines for what %age of the Cypriot public has assets offshore and in hard assets in 2012. I believe some/many already do hold some %age in PMs (because I've been there & know/heard that's historically a tradition/practice) but we'll see how 'offshore accts' for Cypriots will be affected going forward. Foreign 'offshore' asset might evaporate, but those aren't CYPRIOT assets either.

This phenomenon might affect PM bullion prices but only if IF IT SPREADS (Euro-Malaise) because YES, Cyprus itself is basically a sideshow and insignificant in global PM demand anyway.

The SIGNIFIER, however, might be milestone - we shall see.

 

I don't disagree, especially about Cyprus traditionally being a gold buyer, (like Turkey), and this event is more important potentially as a bellwether to others than the event itself. One thing I am pretty sure of, having this done so close to their country, its going to make it that much harder for Turkey to convince their citizens to not buy as much gold as they have been buying. They were trying to convince them to "deposit" gold in special gold ounce accounts at the banks. I doubt now this idea will fly.

Btw, I am not sure how valid your poll results will be, since by its nature people on CT are much more likely to wish to own PM. I think your results will be a stronger predisposition to buy PM than the general public would show.

 

I see somewhere the Population of Cyprus is 1,116,564. Although that includes the Turkish part, I'd bet BOTH areas see more indigenous PM ownership/%age as a result of these events. I have no idea who favors MORE GOLD (by culture, both are 'gold buggy') but more non-Greek Western European expats live on the 'Greek Cypriot' side I suppose. otoh, maybe expat types are more apt to hold PMs too?!

More informative might be to compare PM ownership on MALTA or some other Mediterrean offshore haven (Gibralter? Monaco? Ceuta?) but all of these are secretive, too small, no Gold bazars, etc.

C'mon!!!! Really?!

 

If you look at the Great Depression it took years for gold and silver to peak as people slowly got up to speed. Expecting things to shoot up overnight or using the fact that they didn't do so as an excuse that PMs will not fulfill the role they always have in the past is short sighted. In fact there was a very small spike when this was first announced over a week ago, but it was hammered down. Why anyone would think price discovery based on 2% real supply and 98% faux supply is an accurate measuring stick is beyond me.

 

London, figures.

http://www.reuters.com/article/2013/03/25/eurozone-cyprus-muddle-idUSL5N0CG13920130325

 

Please share these details, thx

 

We'd have to ask Reuters or someone in the industry. I would imagine most of it was done electronically.

 

Howdy,

Ah, why doesn't it surprise me that there may have been some other forms of withdrawal of targeted deposits.

This is based upon the Cypriot gov't setting itself up as a tax shelter/haven in order to buoy their economy. It attracted lots of russian mafia money and got so out of control the EB decided to shut the operation down - per force.

The origianl deal floated by the Cypriots was to only hit the russians by 15% and screw their entire population to give themselves cover from unhappy russians. This was completely beyond the pale and sent shudders through the entire banking system world wide because it would violate the 'FDIC' insurance that covers deposits up toe $100K. Nada said the huns. Now they've got to hit the russians for 40% to get enough and close the worst of the banks.

Now, the Cypriot politcians can get reelected (instead of burned at the stake) so they'll be easy pickens for unhappy russian mafiosos. Not a fun place for them [but personally I love to see policians hoisted on their own petard].

Ergo, to hopefully save their miserable lives, they left the drive up windon open in London.

Is anyone surprised?

peace,

rono

 

The Cyprus banks failed because they invested (gambled) heavily in Greek bonds, which promptly headed south, causing enormous paper losses.

The bank failures had nothing to do with Russian deposits. Of course the Russians are angry, they look like fools for failing to see the obvious.