Poland seizes half of its people’s retirement funds

Stalin the butcher smiles.
Stalin the butcher smiles.

This is disheartening as Poland appeared until very recently to be on the fast track to legit 1st tier European status. Sadly it has just taken a big step off of this track.

As we have said many times on this site we are witnessing the ebbing of the economic tide around the world. Greece, Portugal, Spain, Ireland, Argentina, Cyprus, Italy, Hungary, Japan, France, the United Kingdom are all dealing with unprecedented (at least in the modern era) economic challenges. China and the USA because of unique circumstances are a little further behind but the waters are moving out in these countries too, and it is becoming more obvious.

This is why the Fed is not “tapering.” Things are bad. The bile of 2007/2008 which floats through the world’s economic bloodstream was never purged. A more calamitous economic disruption than 2008 is likely to happen in the relatively near future (years not decades) and there will be seizures of assets in other countries along the way. Plan accordingly.

Nothing is 100%. Perhaps things calm down. Perhaps a solution other than coming clean economically on a global scale will be found. Perhaps there is some way forward other than letting markets finally clear. Perhaps gravity will no longer work. But I doubt it. You should doubt it too.

(From Forbes)

Poland has pulled a destructive stunt worthy of Argentina. It is seizing half of the Polish people’s private retirement funds. All government bonds in these pension-plan portfolios are being forcibly transferred to the government. Since the bonds are no longer held by investors, the government is declaring that the national debt has been reduced by the face value of those securities. Neat trick, including the spin on this Soviet-style seizure: The government is calling the nationalization a “pension overhaul.” The ghosts of Stalin and Lenin must be smiling.

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