[Tex Pro]

ECB Tells Cyprus It's Monday Or Bust:

http://www.slate.com/blogs/moneybox/2013...dline.html

^Looks like this game of chicken is coming to an end soon. Either Cyprus accepts the bailout by Monday or the ECB will cut off their banking system from emergency funding and it collapses.

[Handsome Creepy Eel]

Can anyone think of a reason for Portugal/Greece/Ireland/Spain/Italy citizens not to stage a mass bank run Monday? If governments are forced to steal their citizens' savings at gunpoint like this, why should anyone trust that they won't be next?

[Tex Pro]

(03-21-2013 08:53 AM)Handsome Creepy Eel Wrote:  

Can anyone think of a reason for Portugal/Greece/Ireland/Spain/Italy citizens not to stage a mass bank run Monday? If governments are forced to steal their citizens' savings at gunpoint like this, why should anyone trust that they won't be next?

The biggest problem is that if the ECB lets the Cyprus banks fail, then Cyprus will have to leave the Euro and start printing the Cyprus Pound.

This would set a terrible precedent since it would start to give ideas to Greece, Spain, Portugal, and Italy. In fact, it would only be a matter of time before one of the PIIGS would decide to just default in their debts, leave the Euro, and start printing their own currency.

[Tex Pro]

Euro Official On Cyprus: "Markets Believe We Will Find A Solution, This Might Not Be The Case":

http://www.zerohedge.com/news/2013-03-21...se-we-have

[Tex Pro]

The Cyp-Riots Begin:

http://www.zerohedge.com/news/2013-03-21...iots-begin

[Deepdiver]

(03-21-2013 08:48 AM)The Texas Prophet Wrote:  

ECB Tells Cyprus It's Monday Or Bust:

http://www.slate.com/blogs/moneybox/2013...dline.html

^Looks like this game of chicken is coming to an end soon. Either Cyprus accepts the bailout by Monday or the ECB will cut off their banking system from emergency funding and it collapses.

This is basically a declaration of economic war against the people of Cyprus by the ECB in the form of a 10% shakedown on their bank accounts - if it can happen to Cyprus why not the other PIIGS or any other country for that matter that decides radical Austerity measures are in order.

Best thing Cyprus and the PIIGS can do is to reinstate Monetarily Sovereign Currency Systems versus giving up control of their economies to the people who control the Euro (ECB, IMF, Germany et al) and could really care less about the CPIIGS and their people.

http://neweconomicperspectives.org/p/mod...rimer.html

http://neweconomicperspectives.org/2011/...oland.html

[Greek kamaki]

Schauble puts again a masterful performance.While the Germans bluffed in case of Greece they do not bluff in the case of Cyprus.They will let the banks go bankrupt since the size of the country is too small to have any effect.Let's see how the Germanics played out the South:
1.They treated each country as a different case with different deals which was beneficial for them
2.As a result the countries in the South failed to collide a common front
3.The Germans could use bluff and threat of imminent collapse by just showing one member to the other as an example to be avoided.
So the middle class in all South is in a clusterfuck situation.They do not know what to do because the Germans put them in front of false dilemmas where the one choice is bad and the other even worse.The South can never gain any initiative.Germans have the general order.

By acting independantly like in the case of Cyprus the southern countires put their necks under the German sword.It is like the fish which when it moves trying to get out of the fishnet gets inside it even more.The South is really trapped and Germanics complete the encirclement in their triumph.

[Mekorig]

*See the Cyprus situation, remember the 2001 in Argentina* Ahhh, the shitty times...

[Samseau]

(03-21-2013 02:22 PM)Mekorig Wrote:  

*See the Cyprus situation, remember the 2001 in Argentina* Ahhh, the shitty times...

Did you live through that directly? What were your experiences?

[BIGINJAPAN]

Cyprus needs to do exactly what Iceland did. Cover all deposits and let the banks go under and prosecute the bankers. Let interest rates go to 20% and devalue their currency. Britian and Holland tried to blackmail iceland and it didn't work. They even tried having them listed as terrorists. Iceland had growth after 2 years. Unlike the PIIGS which haven't seen any real growth since 2008.

[Mekorig]

(03-21-2013 02:23 PM)Samseau Wrote:  

(03-21-2013 02:22 PM)Mekorig Wrote:  

*See the Cyprus situation, remember the 2001 in Argentina* Ahhh, the shitty times...

Did you live through that directly? What were your experiences?

I wasnt working at the time, so i didnt have any money seized, and my family`s didnt too, but i know people with saving in dollars that lost a lot, and i still remember seeing in the news the riots, and fearing for the worst. The fabrics of the national cloth almost broke that day.

[Handsome Creepy Eel]

But don't worry, Cyprus, Ireland's austerity measures have resulted in a sharp recovery, low interest rates and a plummeting employment!
/sarcasm

[Locksmith]

Indeed, I see the greatest danger here being a Run For The Banks in other southern countries if people get the "It could happen to me too" idea.

In Brazil, it took decades of major pain, downturn and reform before some confidence was reestablished. People (and thus the wider economic scene) don't easily forget when their money is confiscated from their accounts. This is the one thing you should never try to suggest if your aim is to seek stability.

By the way, can we completely exclude that the Russians won't jump in financially? Or is it all a big bluff? I really don't know what they will do in the end, but they could, theoretically, afford it. Interesting precedent if it ever happens.

[babelfish669]

I've been reading economics books, The Economist, and The WSJ, for over 10 years, I picked this brand new book up about two weeks ago and its done more to explain international trade than anything I've read before. What does Cyprus have to do with China and the US? A lot. Highly recommended, after reading it you'll understand more about this stuff than 99.9% of people out there.



Btw, the writer advocates solutions which I don't really agree with, and a lot of people here probably don't either, but, I think he presents a very honest and realistic representation of balance of payments and international trade (which consequently is basic math being turned in to ludicrously complex explanations by pop economists and cable talking heads.)

[Partizan]

There are strong rumours that the Laika Bank will never reopen. The Cypriot Government is meeting tonight to consider Plan B.

Cyprus is heading for Argentina style meltdown if they dont act very soon.

[Deepdiver]

(03-21-2013 02:31 PM)BIGINJAPAN Wrote:  

Cyprus needs to do exactly what Iceland did. Cover all deposits and let the banks go under and prosecute the bankers. Let interest rates go to 20% and devalue their currency. Britian and Holland tried to blackmail iceland and it didn't work. They even tried having them listed as terrorists. Iceland had growth after 2 years. Unlike the PIIGS which haven't seen any real growth since 2008.

+1 and Cyprus has a major advantage over Iceland - it is a strategically located warm weather island full of refuge seeking people and money - all Cyprus needs to do is issue its own Sovereign Currency and still allow its Banks to offer various interest bearing accounts in various currencies backed official instruments of the major Currency holders and NOT backed by the Cypriot Government - keep the same low tax environment and Cyprus could be come the Grand Caymans and Singapore of the Med on Steroids fueled by EU RU and USA tourism, trade and financial holdings - quite similar really to Switzerland which merely offers a histroy of neutrality but during times of financial upheaval and massive inflows of Cash to Switzerland they allow their Banks to charge depositors up to 2 or 3 % per year for the privilege of holding the money in "safe" Swiss banks - or investing in various instruments the Swiss create to facilitate international trade and make Switzerland one of the richest places on the planet yet with a population smaller than most other EU countries at only 8 Million +/-. As part of a conversion to a true Monetarily Sovereign currency the peoples deposits would not only be covered but receive a 50% one time conversion bonus and shops could accept exchange the Euro Ruble Dollar or Cyprobuck - all shops and restaurants could use smart phone apps that scan a menu item and present the bill in whatever currency the tourists and visiting business men want to pay in and the offshore businesses and accounts so popular in Cyprus could be held in individual or baskets of currencies similar to what Everbank foreign currency CDs (FDIC insured btw) in Jacksonville FL offers. Bottom line NO protests No riots and Cypriots earn a 50% bonus for converting to a Monetarily Sovereign currency and Cyprus south retains its safe have status for Russian and EU multi-millionaires and international businesses.

This ECB and German arm twisting would be seen as a small bump in the road as Cyprus relative wealth of it people skyrockets relative to the other Euro users and PIIGS & EE in particular.

[Deepdiver]

Interesting:

http://finance.yahoo.com/blogs/daily-tic...51783.html

“At this stage of a recovery normalized interest rates should be around 2-3%,” says Rickards. “Apply that 2-3%…to the entire multi-trillion-dollar deposit base of the United States of America and that’s a $400-billion per year wealth transfer from savers to bankers so they can pay themselves bigger bonuses or make crazy bets.” Over time, Rickards says, that wealth transfer could reach $1 trillion.

[poutsara]

I'm not an economist. Someone who knows more than me please explain if there is a real difference between these two scenarios:

The proposal in Cyprus is to simply take 10% (or so) of the deposits from the accounts in the bank. This is to pay off the creditors who could bail them out?

Is another option to get rid of the value of the debt itself? For example by just printing cash/devaluing your money? Is this what America does? Does it matter in the end if your money is just taken out at once or if it is "devalued" by 10% over a year or two without you noticing? Is this like boiling a frog versus throwing a frog into boiling water? Am I missing something? I'm not an expert in this.

[Deepdiver]

The Bear has spoken:

Russia may rethink euro in reserves after Cyprus :

MOSCOW (Reuters) - Russia may need to review the share of euros it holds in its central bank reserves over the euro zone's bungled handling of a bailout of Cyprus, Prime Minister Dmitry Medvedev was quoted on Thursday as saying.

"I would like to answer in an optimistic way but I have to say that this is a reason to think about it," Medvedev said when asked whether the situation in Cyprus was a reason to reduce the euro share of Russia's reserves, according to Interfax.

Some 42 percent of Russia's foreign exchange holdings - the world's fourth-largest - were held in euros as of January 1 this year, when Russia's total gold and forex reserves were worth $537 billion.

"This is a big money but for us, as for any other country, predictability is important, while the proposal (to levy a tax on bank deposits) was not only unpredictable but is evidence of a certain inadequacy," Medvedev was quoted as saying.

In a vote on Tuesday, the island's legislature threw out the proposed tax, which was a condition for a 10-billion euro bailout from the EU, and the country ordered banks to stay shut till next week to avert financial chaos.

"If it can be done in Cyprus, why not in Spain, in Italy, or in other countries where there are problems with finances? Tomorrow they will start to confiscate deposits there. This is a reason to begin to think," he added.

On Wednesday Medvedev also said the EU had behaved "like a bull in a china shop" and compared its proposals, which would force Russian customers to contribute to the rescue of Cypriot banks, to Soviet-era confiscations.

[michelin]

Kamaki, how is the Russian poon in Cyprus?

Among population of 30.000 Russians there must be some talent, too, right?

[Deepdiver]

(03-21-2013 04:45 PM)poutsara Wrote:  

I'm not an economist. Someone who knows more than me please explain if there is a real difference between these two scenarios:

The proposal in Cyprus is to simply take 10% (or so) of the deposits from the accounts in the bank. This is to pay off the creditors who could bail them out?

Is another option to get rid of the value of the debt itself? For example by just printing cash/devaluing your money? Is this what America does? Does it matter in the end if your money is just taken out at once or if it is "devalued" by 10% over a year or two without you noticing? Is this like boiling a frog versus throwing a frog into boiling water? Am I missing something? I'm not an expert in this.

Long term devaluation you can hedge in a manageable way sort of how the markets factor in the USA inflation rates both official and real shadowstats.gov - this however was an unexpected surprise Confiscation of 10% of most major depositors accounts - basically legalized theft forced on Cyprus by the ECB - no way to hedge thus enraged depositors from Nicosia to Moscow and London. That the ECB and Germans would even suggest this gives pause to everyone holding any Euros... of course the outcome is likely conversion to safer currencies and a drop in the demand for and therefore value of the Euro and a more economical climate for UK and NA game aficionados across Euroland.

[poutsara]

(03-21-2013 05:11 PM)Deepdiver Wrote:  

(03-21-2013 04:45 PM)poutsara Wrote:  

I'm not an economist. Someone who knows more than me please explain if there is a real difference between these two scenarios:

The proposal in Cyprus is to simply take 10% (or so) of the deposits from the accounts in the bank. This is to pay off the creditors who could bail them out?

Is another option to get rid of the value of the debt itself? For example by just printing cash/devaluing your money? Is this what America does? Does it matter in the end if your money is just taken out at once or if it is "devalued" by 10% over a year or two without you noticing? Is this like boiling a frog versus throwing a frog into boiling water? Am I missing something? I'm not an expert in this.

Long term devaluation you can hedge in a manageable way sort of how the markets factor in the USA inflation rates both official and real shadowstats.gov - this however was an unexpected surprise Confiscation of 10% of most major depositors accounts - basically legalized theft forced on Cyprus by the ECB - no way to hedge thus enraged depositors from Nicosia to Moscow and London. That the ECB and Germans would even suggest this gives pause to everyone holding any Euros... of course the outcome is likely conversion to safer currencies and a drop in the demand for and therefore value of the Euro and a more economical climate for UK and NA game aficionados across Euroland.

So the difference is that one you can plan around because it's expected and the other you can't. Got it.

[Greek kamaki]

(03-21-2013 05:09 PM)michelin Wrote:  

Kamaki, how is the Russian poon in Cyprus?

Among population of 30.000 Russians there must be some talent, too, right?

It is quite good.Unfortunately the Russian women there tend to hook with the locals in case they search for a work or residence.There are chances with tourist girls though.I remember one who told me she could not follow me because her husband was waiting for her at the beach.Generally Russian women are mega infidels and have several boyfriends(it is a slavic custom).
The local Cypriots I saw they always hooked up only with Russian girls and no other nationality(their appearance is also inferior compared to mainland Greeks).

[Greek kamaki]

The Germans know that the Russians do not have the money to bail out Cyprus.They just pretend on everything.Schauble appears like the mega capitalist by saying ''they(the Russian firms) took great risk by putting money in banks which gave 4% interest rate per year so now they have to endure the consequences of their risky behaviour.''Western hypocrisy in its top.Schauble plays the South like the cat plays the mouse and is heavily sarcastic.The Cypriots understand this but have no power.

[Partizan]

http://www.eutimes.net/2013/03/russian-l...banks-now/

Statement from the Russian MFA sent to its embassies around the world urging all Russian nationals and businesses to divest themselves from Western banking institutions.