The large depositors at Cypriot banks are shouldering a heavy burden. You’ll recall what happened back in March when the Eurozone financial wizards forced average citizens to participate in what was called a “bail-in.” It seems downright unfair for depositors with more than 100,000 euros to suffer a levy on up to 60% of their deposits. That’s about $140,000, give or take, at current exchange rates. And if you’re a retiree, having the government swipe $84,000 from your $140,000 account just to bail out feckless bankers is a pretty big deal. The dangers inherent in the Cypriot crisis may seem foreign to us, but U.S. bank and brokerage accounts are not as safe as we might think. The federal government may imply that we are preferred customers of the FDIC and the SIPC, but that does not mean we will get the royal treatment should our bank or brokerage firm go belly-up. More on Investor Place here.
