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I get the feeling that, despite having\u00a0has been published<\/a>\u00a0at\u00a0various media<\/a>, has gone largely unnoticed by investors in general. But last week, it was quietly announced that no less than half of all Poles\u2019 private pension schemes were to be confiscated. That\u2019s right: a lifetime\u2019s savings, set aside to provide for their needs in old age, have been halved overnight.\u00a0<\/p>\n This is a full-blown default<\/strong>, currently only a partial portion (though still more than 50%) of the bonds issued by the Polish State held by private pension schemes, which will pay only a paltry amount of interest whilst the principal is valued at a paltry zero, as they are being confiscated and transferred to the State itself. In other words, the entire principal is being confiscated from more than half of the bonds in which private pension schemes entrusted the savings of their Polish clients. Oh, and as the height of state magnanimity, the pension funds\u2019 shareholdings remain intact \u2013 at least that\u2019s something. Two years ago, the population was forced to make 5% contributions to the public pension system. But now, on top of that, the State is confiscating, in one fell swoop, more than half of the savings they had entrusted to private pension schemes.<\/p>\n The excuse, as one might expect, is to put the public coffers and pension funds in order, which should give a boost to the state\u2019s ability to meet its debts and commitments to the population (the part that hasn\u2019t been confiscated, of course). The scale of this massive confiscation, however, barely amounts to 8% of the Polish state\u2019s deficit, which, incidentally, is much smaller than that of Spain, Portugal, Italy or Greece\u2026<\/p>\n At this stage, the obvious references are the ones we wrote a few months ago. Today, more than ever, we investors must\u00a0to prioritise the safety of not having them confiscated<\/strong><\/a>\u00a0or face permanent financial losses, as opposed to the reckless returns offered by counterparties such as Spanish banks or peripheral debt. Because\u00a0Legislation has already been introduced in the EU to allow for the confiscation of accounts and funds<\/strong><\/a>\u00a0necessary for every member of the periphery to plug their own gaps with the savings of the long-suffering local inhabitants. Even\u00a0Germany has already warned Spain that the easiest and most accessible route to confiscation is through property investments<\/strong><\/a>.<\/p>\n