[ExI] cyprus banks

[Mirco Romanato]

Il 19/03/2013 21:35, Adrian Tymes ha scritto:

> Not a European, but I'm seeing a clear view from the media:

> * It was proposed to take the money.  The money couldn't actually be
> taken until Parliament approved.

> * Parliament said "HELL NO".

The lawmakers said "Hell NO!!! If we approve this the people will want
hang us, the Russian Mafia will want hung us and our family, the people
will take their saving out of the banks, the Russians will take money
out of the banks and the banks and the government will be broken and
dead anyway.

> * Their President suggested exempting deposits under 20K euros, but
> noted that might not be agreed to by the bailout negotiators.  Parliament
> rejected the idea even with that exemption.

Because this would have broken the banks and the government anyway.
Their president wanted to shave his citizens because shaving too much
the Russian would have made them fly away with their money (like 10% is
not reason enough to fly away with the money).

BTW, the effect of not obtaining the Troika help could be the immediate
stop of the currency flow from the ECB to Cyprus banks. So they would go
broken immediately for lack of liquidity (not to talk about solvency).

> * The banks over there are closed until Thursday anyway.

> * It is possible that a bank run may happen once the banks reopen
> despite the rejection, since the mere suggestion of this quickly lead to
> mass protests.  (The currency is confidence based, after all.)

The only way to reestablish some confidence is to put in their
constitution, an article forbidding the government to put any tax on
bank accounts or any form of cash.
Tomorrow could be a good idea. Today a better idea.

> * It has been suspected that their banks might be close to collapse.
> Ironically, a bank run makes it more likely that they will collapse.

Russia (Gazprom) is offering a lot of money (comparable to the Troika
Packet) in exchange for the rights on the gas fields offshore Cyprus.
If I was Cyprus I would evaluate the offer very well, because this would
help them a lot with Turkey interference (Greece and EU are useless for
this).

Mirco