In the Canadian Financial Post, columnist Barbara Shecter penned an article entitled “Ottawa Reveals Proposals to Protect Tax PayersFrom Covering Bank Bail-outs.” It was said that just this past Friday Canadian Finance Minister Joe Oliver launched the process of instituting a “Bail-in regime,” were there to be a “highly unlikely” event that a Canadian bank would go bankrupt.

What’s put forward is the same narrative we’ve heard regarding the bail-in in Cyprus and the Single Resolution Mechanism being imposed on the entirety of the European Union, except they’re saying its not the same thing: instead of tax payers having to pay, so they say, it will be the creditors themselves as a means of “protecting” the tax-payer.

This is essentially the same process the world witnessed with the famous case of the Spanish bank Bankia. In the case of Bankia, upon its perceived bankruptcy, its depositors were deceived into purchasing the banks preferred stocks, only to have those stocks tumble to .01 percent of their value in the matter of weeks. In this case, reference is made to senior long term debt, which the bank will be able to convert into equity for the bank. Senior long-term  debt concerns in large part fixed income sources, of which pensions and  Canadian Pension Plans for example, are invested. Therefore the idea of tax payers being exempt is completely fraudulent, given many of these “tax payers” have pensions, and savings, which across the world as in the case of Detroit’s bankruptcy, Cyprus or the planned EU Single Resolution Mechanism, are all different tricks for looting the population in order to save a dying financial empire. In this specific instance it explicitly states that bank deposits are exempt unlike in the Title II of Dodd Frank and others,  but the reality of the world financial system disintegrating should give any thinking citizen the perspective that Canada would not fare too well were Europe and the USA to go into a systemic seizure of depositors accounts.

There’s also a proposal for the cancellation of some or all of the pre-existing bank shares, which is exactly what it means; the banks shares will be devalued to zero…

An ominous foreshadowing of this comes as only recently the Royal Bank of Canada announced its sale of “Bail-in Bonds,” which are bonds, like senior long term debt, which would be converted into equity i.e. Bankia style shares, in the case of a default declared by the Office of the Superintendant of Financial Institutions (OFSI). In fact, under the new Basel III international banking regulations, nations are actually required to issue “bail-bonds.”

Are secret bail-in bonds already being sold, as in the case of Spain’s Bankia, in Canada?