[ExI] cyprus banks

Mirco Romanato painlord2k at libero.it
Sat Mar 23 21:07:40 UTC 2013


Il 22/03/2013 17:47, Adrian Tymes ha scritto:
> On Fri, Mar 22, 2013 at 8:38 AM, BillK <pharos at gmail.com> wrote:
>> On Fri, Mar 22, 2013 at 2:48 PM, Mirco Romanato  wrote:
>>> This imply they will stop giving them paper cash monday.
>>> The Cyprus bank will become immediately illiquid and insolvent.
>>
>> Or they might be issuing Cyprus pounds instead of euros.
>> They can print as many of these as they require.
> 
> Not unless they exit the Euro...which they might.

There are as many dollarized economies around the world (places where
the currency is the US$ but they are not the US) as eurized economies
around the world (places where the € is the currency even if the place
is not in the Eurozone).

Cyprus out of the Euro imply the Central Bank of Cyprus is unable to
obtain € from the ECB and is unable to have any say about the ECB policy.

Cyprus people can and will continue to use € as they wish to accept them
in payment for goods and services. Like in Argentina the people accept
US$ in payment for goods and services and prefer them to pesos.

Cyprus government and Cyprus central bank can issue as much as Cyprus
pounds as they wish, people will prefer a sounder money to something not
worth the paper used.

Mirco




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