"We Track the Financial Collapse For You, so You'll Thrive and Profit, In Spite of It... "

Fortunes will soon be made (and saved). Subscribe for free now. Get our vital, dispatches on gold, silver and sound-money delivered to your email inbox daily.

This field is for validation purposes and should be left unchanged.

Safeguard your financial future. Get our crucial, daily updates.

"We Track the Financial Collapse For You,
so You'll Thrive and Profit, In Spite of It... "

Fortunes will soon be made (and saved). Subscribe for free now. Get our vital, dispatches on gold, silver and sound-money delivered to your email inbox daily.

This field is for validation purposes and should be left unchanged.

What If You Had An Italian Bank Account? Or A Portuguese Bond?

Though it might yet drag on for weeks, months or even years, Greece’s drama can end in one of only two ways: Continued austerity which consigns its most vulnerable 50% to an endless “capital D” Depression, or some form of temporary dictatorship complete with capital controls and wealth confiscation — and a then “capital D” Depression. Either way, some of today’s Greek kids might grow up without ever holding a job in a legitimate business. For more details, see Greece’s hideous choice: More austerity or collapse.

But Greece was never the main story. At best (worst?) it’s an illustration writ small of what’s really coming, as the eurozone’s bigger weak economies travel the same road. Italy, Spain, and Portugal will soon need (more accurately demand) a Greek-style bailout, though with a twist: There isn’t enough money available anywhere to bail out economies of that size sufficiently to allow them to remain in the common currency union NOR to manage the debt writedowns that would instantly hit the major European banks if those countries withdraw from the euro. So whatever Greece does, the real crisis is on its way. Here’s a good Zero Hedge analysis of what comes next.

To understand this convergence of inevitable and imminent, put yourself in the shoes of an Italian with a local bank account. You’re seeing the footage of Greeks queuing up around the block only to be greeted with “No Money” signs when they finally reach the ATM. And you’re drawing the right conclusion: Get your money out of the local bank and under your mattress, into a tin can buried in the back yard, or into a Swiss franc account even at the cost of a negative interest rate. Later, when Italy has left the eurozone and returned to a much-devalued lira, those euros/francs will be worth twice as much as they are today.

Or buy gold just in case Italy gets bailed out with a trillion newly-created euros, causing that currency’s value to plunge. Just don’t leave it in the local bank to be confiscated by the government.

All it will take is a few tens of thousands of like-minded Italians, Spaniards and Portuguese to crash their local banking systems. But why would it be only that many? Why would anyone with money in those banks, even if they’re far more optimistic than our hypothetical Italian, not empty their accounts just to avoid the turmoil caused by the pessimists?

And why would anyone lend money to those countries for five or ten years, which is what you do when you buy one of their bonds? That banks, governments and hedge funds around the world have gorged on eurozone debt while writing hundreds of trillions of dollars of derivative “insurance” on them is something historians will be scratching their heads over for decades.

12 thoughts on "What If You Had An Italian Bank Account? Or A Portuguese Bond?"

  1. SO PROUD OF THE GREEKS….that no vote took guts, they didn’t cave to pressure and threats and bank closure and bailins…. a little truth in the market place is a good thing, let’s acknowledge un-payable debt, stop playing pretend, Bravo! truth…. Bravo! Democracy.
    I’m going to celebrate by pulling money from my bank account and buying gold and silver. I also pledge to sent aid to Greece in the coming challenges they face.

  2. And why would anyone not empty their bank accounts since the “opportunity cost” is so low? With interest rates so low on savings, what is there to lose by holding cash outside the banking system? (Possible loss due to theft, maybe?)

    But here’s another question which may contain the answer: Why didn’t people do this a long time ago? I think the answer to that is they didn’t understand how the monetary system works and/or they didn’t believe it. If that’s true then they may still be stuck on stupid and may end up as road kill. After all, when Draghi/the ECB said it wanted to devalue the euro in 2010 then shouldn’t people have converted euros to something tangible back then? And when talk of Greece leaving the euro started back in 2012 shouldn’t have Greeks hoarded euros then?

    I think one of the most confounding things about the financial and monetary worlds since 2008 is that the markets have not been rational. That makes analysis and predictions especially difficult.

    That said, I hope Italians and Spaniards and Portuguese do start to get it and really get this show on the road.

    1. Your comment may very well fit the USA in about 2 years. Would you lend me $100 USD if I told you that in a year I would give you back $100.50? However, there is a very very very good chance that I will default on that and you would lose your money? Because that is EXACTLY what every American who has money in a savings account is doing today.

      1. Very true, and what are bond holders in Europe thinking? They’ll lend Germany, say, 1000 euros and then end up with 970 euros two years later.

    2. You answered your own question – How comfortable would YOU feel with let’s say $100,000 in USD hidden somewhere in your house? In the case of fire or burglary, you’re toast. Plus you’d either have to notify your heirs or risk the money being lost in the event of your passing.

  3. That little devil on my shoulder asks “How do we begin some bank runs in earnest in Spain and Italy/” he he…

Leave a Reply

Your email address will not be published. Required fields are marked *


Zero Fees Gold IRA

Contact Us

Send Us Your Video Links

Send us a message.
We value your feedback,
questions and advice.



Cut through the clutter and mainstream media noise. Get free, concise dispatches on vital news, videos and opinions. Delivered to Your email inbox daily. You’ll never miss a critical story, guaranteed.

This field is for validation purposes and should be left unchanged.