Global Stock Market Collapse Begins as European Finance Chiefs Raid Personal Bank Accounts
The decision by the Eurozone to force bank depositors in Cyprus to contribute towards a bailout, a first in the Eurozone debt crisis, could hurt other peripheral nations, the Euro and the global stock market rally, analysts warned.
On Monday March 18, 2013 — the levy could unleash a sell-off in the Euro, the stock markets and bond markets of peripheral nations and usher in the beginning of a 2013 Great Depression.
Eurozone finance ministers forced Cyprus’ savers to pay as much as 10 percent of their deposits to help pay for a bailout of the country’s troubled banking sector, a move which is expected to raise 5.8 billion Euros. In return, the country will get 10 billion Euros ($13 billion) in assistance.
European stock markets will crash (FTSE International) and could fall 11.0 to 13.0 percent on Monday, while the S&P 500 will crash and could fall 5.0 to 7.5 percent.
Meanwhile, The New York Times reported on Saturday that savers had already been trying to withdraw money from banks via ATMs and that many machines had run out of cash but it might be too late already. Cyprus has declared a bank holiday on Monday to prevent such a run on the banks and banned electronic transfers.