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Old 2013-03-20, 12:49   Link #1
AmeNoJaku
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Join Date: Apr 2012
Location: Work in Europe... imminent :(
Cyprus resists?

How do you understand the situation?

From my arguably very biased perspective Ireland, Portugal, and Greece succumbed to UK/DDR executives in Brussels, but Cyprus, having already experienced multiple betrayals from allies (England, Turkey, Greece, and now Germany) has more fortitude to resist the humiliation imposed to them.

Reading news from around the world, I wanted to point out some interesting trivia:
  1. Reigning German oligarchs claimed that Cyprus launders illegal money, but their own country is higher in the relevant list, Luxembourg even higher, not to mention Lichtenstein, Malta, Switzerland, etc.
  2. I was amazed that the church of Cyprus volunteered to aid, usually the church plays hardball with the state, asking for more power (as was the case in the other countries that were ruined by the euro).
  3. Russia proved to be even worse than Germans, not only abandoning their only ally in Mediterranean, in addition they gamble their own investors' money... I guess most of it is clean... otherwise Germany wouldn't have natural gas today... in between this is a "legitimate exaggeration"

Dunno, I am living for some time away from EU, but having experienced it for a long time during my vacation, I get the feeling that fascism is coming back to destroy them. Of course that was coming since mid-2000s, but none seemed to care then

Are they going to destroy again themselves? It's not the first time that conservative to right and extreme-right wing ideologies have killed millions in Europe, but now it's 2013 not 1800s when that idiotic theory made us Prussians, English and French
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Old 2013-03-20, 12:57   Link #2
willx
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Er? Cursory research will tell you the problem with Greece, much of the Mediterranean and a lot of other states that are now in trouble is due not to "right wing" policy but actually "left wing" policies. I'm Canadian and believe in the importance of a social safety net, but you cannot grant your citizens and government employees massive benefits and pensions without tax and other revenues to support it.

On top of that, remember that when a country applied to join the EU, they also agreed to budget constraints and the benefits and limitations of joining a single collective currency. Policy makers failed to understand this issue and the founders of the EU looked the other way when financially unsound countries applied for membership.

Frankly, the idea that there is any conspiracy at work here is laughable, the ability for a large group of people to accidentally do something harmful is generally much greater than any minimal conspiracy among "German oligarchs" -- there is plentiful literature on the topic available. If you want to be informed, it is out there for you, but it may or may not jive with your vision of the world.
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Old 2013-03-20, 13:53   Link #3
Xellos-_^
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just let the banks go bankrupt.
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Old 2013-03-20, 14:18   Link #4
willx
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Quote:
Originally Posted by Xellos-_^ View Post
just let the banks go bankrupt.
This may or may not work. Iceland is an analog we can learn from -- in that situation the banks were all allowed to go "bankrupt" and were seized and restructured by the government. Shareholders and creditors of the banks got mangled. Depositors were mostly left whole -- except for some foreign depositors. See: Landsave dispute. There are some key differences though:

1) Iceland was not part of the EU and had its own currency the Icelandic Krona which it could print and thus devalue the currency. Cyprus cannot as it is part of the EU and cannot freely print Euros. Remember though, printing money is a "currency tax" and causes inflation and therefore hurts everyone that holds your currency. Inflation was up >50% in a year. Imports became prohibitively expensive. Unemployment jumped to double digits. Many shipping and airline and other tourism and import based businesses went bankrupt.

2) When you allow a bank or any large business or institution to go under and you hurt its creditors .. you hurt its creditors no matter who they are. For example, in Iceland's situation, in addition to overseas holders of shares and bonds, Iceland's own pension funds faced significant losses in the range of 15-25%. The reverse trickle down effect resulted in the entire country's economy shrinking by >10% in a year.

That all said, the pain has been "shorter but more intense" than in other situations. The Icelandic economy is expected to grow 2% this year and unemployment is back to single digits.
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Old 2013-03-20, 14:54   Link #5
ArchmageXin
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The whole idiotic problem is EU have so many different cultures/people, and they are strait-jacketed to a single currency.

In pre-EU days, a bottle of mineral water in Greece would worth $0.25 USD, today it is 2.1 Euros.

Yes, Greece cheated, yes Greece didn't reorg their economy in time. Yes Greece has unions. But there lies the fundamental part of the problem, as long as they have Euro hanging over their necks, they can't reform enough to reverse to profitability.
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Old 2013-03-20, 15:02   Link #6
willx
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^ I mostly agree, somewhat disagree. Greece should never have been part of the EU. They shouldn't be part of the EU now. They need to live or die by their own policies and budget.

(They'll die. Repeatedly. Greece has gone bankrupt multiple times. There are stories that after being taken over by the Germans during WW2, the regime attempted to extract resources to fuel the war machine but couldn't because Greeks don't pay taxes and don't keep their books in order. They had to basically blow up the economy via tying currency first to gold then to real assets to extract any value.)
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Old 2013-03-20, 15:07   Link #7
mangamuscle
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^ Besides, I dunno why all this drama about the "evil executives in Brussels", unlike any state of the USA they have the option to secede if they really think they would be better on their own.
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Old 2013-03-20, 15:38   Link #8
ArchmageXin
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Quote:
Originally Posted by willx View Post
^ I mostly agree, somewhat disagree. Greece should never have been part of the EU. They shouldn't be part of the EU now. They need to live or die by their own policies and budget.

(They'll die. Repeatedly. Greece has gone bankrupt multiple times. There are stories that after being taken over by the Germans during WW2, the regime attempted to extract resources to fuel the war machine but couldn't because Greeks don't pay taxes and don't keep their books in order. They had to basically blow up the economy via tying currency first to gold then to real assets to extract any value.)
The problems with succession is

1) It will hurt Greece...a lot.

2) EU will be hurt, if close to critically, because EU's debts are priced on the idea it is carried by the power/faint/credit of the entire EU. If people like Greece can just walk off, the other 16 members will be hurt...dreadfully.
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Old 2013-03-20, 20:27   Link #9
AmeNoJaku
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Interesting opinions...

Quote:
Originally Posted by willx View Post
Er? Cursory research will tell you the problem with Greece, much of the Mediterranean and a lot of other states that are now in trouble is due not to "right wing" policy but actually "left wing" policies. I'm Canadian and believe in the importance of a social safety net, but you cannot grant your citizens and government employees massive benefits and pensions without tax and other revenues to support it.
That must have been a very quick search, since the nature of the financial problems of Portugal, Spain, Italy, Greece and Cyprus are very different... probably you are thinking about the solution that the German government imposed on them (as it did with Ireland), which was to turn each problem into public debt. Cyprus, like Ireland (as well as Luxemburg, Malta, UK and Germany) have disproportional financial services compared to the size of their "real" economies. Greece has an extremely inefficient public sector, but the recipe there only made the problem worse since for the last three years they are trying to reduce it by forcing workers into pension, therefore maintaining the cost, while losing the services.

As for right/left wing divide, I consider conservative parties (Merkel, Berlusconi, Sarkozy, Cameron) as right wing. These along with the similarly minded parties in smaller countries bloated the problems in mid-2000s and are now dealing with them.

Also funds for social services can be acquired cheaply by internal lending (as was done before euro), the problem is that the ECB is not allowed to do that, and it's a pillar of the current policy, that it should never be allowed to do that. Couple that with the rest of the austerity measures, obviously the only outcome would be for the economy to shrink.

I am not saying that economies should be bubbles as are all western economies, but deflating them, and having systems that are based in real production, instead of private sector lending should be done slowly and across Europe, not overnight by annihilating whole countries.

Quote:
Originally Posted by willx View Post
On top of that, remember that when a country applied to join the EU, they also agreed to budget constraints and the benefits and limitations of joining a single collective currency. Policy makers failed to understand this issue and the founders of the EU looked the other way when financially unsound countries applied for membership.
The budget constrains were readjusted for Germany and France in early 2000s, and for the US housing bubble. Also there is a misconception between the EU and the eurozone here. EU is a political union of independent states, the eurozone countries are bound by a strange banking system that benefits one of them.

Quote:
Originally Posted by willx View Post
Frankly, the idea that there is any conspiracy at work here is laughable, the ability for a large group of people to accidentally do something harmful is generally much greater than any minimal conspiracy among "German oligarchs" -- there is plentiful literature on the topic available. If you want to be informed, it is out there for you, but it may or may not jive with your vision of the world.
What conspiracy? I think that this is a matter of perspective, whether one understands reliance of politics to the private sector as beneficial or not.

Quote:
Originally Posted by Xellos-_^ View Post
just let the banks go bankrupt.
You mean in every country? Should that happened for example in Greece the German private sector would have lost about 150 billion euros, which was slowly mitigated across all European taxpayers, mainly Greeks (through the memorandum measures).

Quote:
Originally Posted by willx View Post
This may or may not work. Iceland is an analog we can learn from -- in that situation the banks were all allowed to go "bankrupt" and were seized and restructured by the government. Shareholders and creditors of the banks got mangled. Depositors were mostly left whole -- except for some foreign depositors. See: Landsave dispute. There are some key differences though:

1) Iceland was not part of the EU and had its own currency the Icelandic Krona which it could print and thus devalue the currency. Cyprus cannot as it is part of the EU and cannot freely print Euros. Remember though, printing money is a "currency tax" and causes inflation and therefore hurts everyone that holds your currency. Inflation was up >50% in a year. Imports became prohibitively expensive. Unemployment jumped to double digits. Many shipping and airline and other tourism and import based businesses went bankrupt.

2) When you allow a bank or any large business or institution to go under and you hurt its creditors .. you hurt its creditors no matter who they are. For example, in Iceland's situation, in addition to overseas holders of shares and bonds, Iceland's own pension funds faced significant losses in the range of 15-25%. The reverse trickle down effect resulted in the entire country's economy shrinking by >10% in a year.

That all said, the pain has been "shorter but more intense" than in other situations. The Icelandic economy is expected to grow 2% this year and unemployment is back to single digits.
Indeed, but you are missing another key difference for Cyprus, their economy is based around their banking system, whether you force them into bankruptcy or destroy their credibility is in effect completely destroy the country altogether. On the other hand, it would be unfair not remind everyone that Germany and Cyprus are doing all these for less then 6 billion euros that is about 0.13% of Germany's GDP or 20% of Cyprus'.

Quote:
Originally Posted by ArchmageXin View Post
The whole idiotic problem is EU have so many different cultures/people, and they are strait-jacketed to a single currency.

In pre-EU days, a bottle of mineral water in Greece would worth $0.25 USD, today it is 2.1 Euros.

Yes, Greece cheated, yes Greece didn't reorg their economy in time. Yes Greece has unions. But there lies the fundamental part of the problem, as long as they have Euro hanging over their necks, they can't reform enough to reverse to profitability.
EU and euro are not the same, as for the price of bottled water inflation is to blame (which in principle austerity is trying to fight), and you are forgetting that salaries have proportionally increased in the public sector (for Spain and Italy in the private sector too).

Quote:
Originally Posted by willx View Post
^ I mostly agree, somewhat disagree. Greece should never have been part of the EU. They shouldn't be part of the EU now. They need to live or die by their own policies and budget.

(They'll die. Repeatedly. Greece has gone bankrupt multiple times. There are stories that after being taken over by the Germans during WW2, the regime attempted to extract resources to fuel the war machine but couldn't because Greeks don't pay taxes and don't keep their books in order. They had to basically blow up the economy via tying currency first to gold then to real assets to extract any value.)
With that logic EU should be Germany, Switzerland, Austria, and maybe Finnland and the Netherlands. But again I think you are equating the EU with the eurozone. This is no EU, but WW2-like allience. As for a eurozone with those countries will strip them of the all the benefits euro gave them.

Personally, I agree that Ireland, Portugal, Spain, Italy, Greece, and Cyprus shouldn't have entered the eurozone, and it would have been better if they have left when their problems started manifesting when UK and Germany bailed in their own banks and the later readjusted the budget constrains. I can understand that they were counting on doing so later in their cases, but that was wishful thinking.

Quote:
Originally Posted by ogon_bat View Post
^ Besides, I dunno why all this drama about the "evil executives in Brussels", unlike any state of the USA they have the option to secede if they really think they would be better on their own.
States in the USA can not secede. Back to the eurozone, countries can exit the monetary union, only by exiting the union, which would be disastrous for everyone. It would be great if there was a mechanism to leave temporarily the eurozone, but that like complete exit would be very bad for the strong economies.

Quote:
Originally Posted by ArchmageXin View Post
The problems with succession is

1) It will hurt Greece...a lot.

2) EU will be hurt, if close to critically, because EU's debts are priced on the idea it is carried by the power/faint/credit of the entire EU. If people like Greece can just walk off, the other 16 members will be hurt...dreadfully.
That was true before the memorandum, because one of the terms was to switch external debt to foreign legal jurisdictions (mainly UK law). Still political and psychological factors aside, euro will rapidly rise, German exports will be hurt, and should the poor countries leave EU (and only the eurozone) a third of the highly skilled workforce of rich countries will overnight disappear.
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Old 2013-03-20, 20:56   Link #10
willx
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So, I addressed each of my responses to separate part of your statements, but you appear to have a rather interesting set of preconceived notions that is clear from your language. I'm curious what these beliefs are founded upon? I work in Finance, I evaluate companies/businesses in financial distress and I'm generally well versed in macro effects and policy impacts on particular markets and businesses. I've also done research on the working papers that resulted in the formation of the EU/Eurozone and how they were adjusted beyond the framework of its initial design to allow countries that would have otherwise not met the initial thresholds.

I personally think the EU, which I mean to also include the concept of the Eurozone or officially "euro area" despite knowing they're different for simplicity's sake, in terms of an economic and monetary union perspective was the dumbest move in the world. The difference is I think it was very stupid for France and Germany as well, despite the benefits to those countries (currency, terms of trade).

Anyways, the idea of taxing all depositors was a bad idea, the structure will likely in coming days be revised to apply a "tax" only to deposits above the statutory insured amount. Ultimately, if the banks were to go bankrupt instead without support only the statutory insured amount would be guaranteed by the government anyway.

Ultimately, I'm unsure of what you believe to be the "ideal" situation with regards to the banking system, global reserve currencies and use of leverage in business. Germany benefited from a weaker currency and thus benefited via trade. Greece and numerous other countries benefited due to an increased perception of safety and thus could borrow and otherwise have terms of international trade beyond its fundamental credit worthiness. Cyprus benefited when it joined as it then shared the same currency as its largest trading partner, Greece, and became ever more a finance gateway between Western Europe and Central Europe. That said, Greece, separate from the EU would have faced financial issues much sooner and without a bail out would have declared cascading private and public bankruptcy. Cyprus as one of Greece's largest trading partners and holder of significant Greek bonds would have faltered as well. Is any of that really in doubt?
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Old 2013-03-20, 21:17   Link #11
mangamuscle
formerly ogon bat
 
 
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Quote:
Originally Posted by AmeNoJaku View Post
States in the USA can not secede.
That is what I said
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Old 2013-03-20, 21:34   Link #12
ArchmageXin
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Quote:
EU and euro are not the same, as for the price of bottled water inflation is to blame (which in principle austerity is trying to fight), and you are forgetting that salaries have proportionally increased in the public sector (for Spain and Italy in the private sector too).
No, is not inflation, is the value of their currency. (Lira I think?), It is like how Americans visit Japan and say "everything is cheap!" because Dollar holds > value than Yen.

So if Greek economy is getting weak, is currency falls, and people will buy greek goods more. The problem is now you are straddled on to a super currency that worth more than the dollar and slightly less than British pounds, your currency cannot depreciate by either design or market force.

Now you are in trouble. You can't just all blame "public sector" for this, especially since public sector also provide services.
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Old 2013-03-22, 03:26   Link #13
AmeNoJaku
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Sorry, but I can not address everything here, I'll try though as many as I can...

Quote:
Originally Posted by willx View Post
So, I addressed each of my responses to separate part of your statements, but you appear to have a rather interesting set of preconceived notions that is clear from your language. I'm curious what these beliefs are founded upon?
Trying to listen carefully arguments from all sides, whether it's current or historical politics. Obviously, I (like everyone) have come to certain conclusions, but in my case, I have been persuaded by strong counter-arguments.

Quote:
Originally Posted by willx View Post
I work in Finance, I evaluate companies/businesses in financial distress and I'm generally well versed in macro effects and policy impacts on particular markets and businesses. I've also done research on the working papers that resulted in the formation of the EU/Eurozone and how they were adjusted beyond the framework of its initial design to allow countries that would have otherwise not met the initial thresholds.
I guessed as much, your perspective follows the popular beliefs of that sector in the west.

Quote:
Originally Posted by willx View Post
I personally think the EU, which I mean to also include the concept of the Eurozone or officially "euro area" despite knowing they're different for simplicity's sake, in terms of an economic and monetary union perspective was the dumbest move in the world. The difference is I think it was very stupid for France and Germany as well, despite the benefits to those countries (currency, terms of trade).
I insist on separating the political union from the monetary... The reason is that the political union progressed slowly but steadily before the monetary one, most of the successful policies are also independent from the monetary union. In any case, concerning the monetary union, I disagree that Germany lost from it, Germans did, but their companies and economy bloomed again, after cheap East German cost was running out of steam. For the rest of the countries, it wasn't a bad idea, they could take advantage of it, but should I oversimplify, they made the worse possible decisions.

Quote:
Originally Posted by willx View Post
Anyways, the idea of taxing all depositors was a bad idea, the structure will likely in coming days be revised to apply a "tax" only to deposits above the statutory insured amount. Ultimately, if the banks were to go bankrupt instead without support only the statutory insured amount would be guaranteed by the government anyway.

Ultimately, I'm unsure of what you believe to be the "ideal" situation with regards to the banking system, global reserve currencies and use of leverage in business. Germany benefited from a weaker currency and thus benefited via trade. Greece and numerous other countries benefited due to an increased perception of safety and thus could borrow and otherwise have terms of international trade beyond its fundamental credit worthiness. Cyprus benefited when it joined as it then shared the same currency as its largest trading partner, Greece, and became ever more a finance gateway between Western Europe and Central Europe. That said, Greece, separate from the EU would have faced financial issues much sooner and without a bail out would have declared cascading private and public bankruptcy. Cyprus as one of Greece's largest trading partners and holder of significant Greek bonds would have faltered as well. Is any of that really in doubt?
I think you assumed some things there... probably it's my fault too making partial statements

Anyway, about the banking system, I think that separating investment and shadow banking from savings accounts, pension funds and low-risk loans. This was actually how banks were operating up to mid-90s. Now shadow banking and high-risk funds shouldn't be insured by states or even allowed to loan states. Now this is simply impossible, not only for Cyprus, but for Germany and the UK, the later in particular is trying to do it for a couple of years now with very little success. In Cyprus they tried to do this overnight, destroying completely the whole country... which makes me extremely suspicious about the ultimate goals in their case.

Quote:
Originally Posted by ogon_bat View Post
That is what I said
Sorry, I misread you there

Quote:
Originally Posted by ArchmageXin View Post
No, is not inflation, is the value of their currency. (Lira I think?), It is like how Americans visit Japan and say "everything is cheap!" because Dollar holds > value than Yen.

So if Greek economy is getting weak, is currency falls, and people will buy greek goods more. The problem is now you are straddled on to a super currency that worth more than the dollar and slightly less than British pounds, your currency cannot depreciate by either design or market force.

Now you are in trouble. You can't just all blame "public sector" for this, especially since public sector also provide services.
Education, trans-national mobility, peace, support programs, social inclusion programs, and a lot more are benefits from the union... agricultural policy was a great idea, but ended up as an expensive and unpopular flop.

The monetary union had the potential for rich countries to benefit form an undervalued currency boost their exports, while poor countries gained access to cheap funds in order to expand their real economy, instead of finance institutions, public sector, land bubble, etc.
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Old 2013-03-22, 03:54   Link #14
Vallen Chaos Valiant
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The priority of any government concerning financial policy should be to prevent a bank run.

I don't care how in debt you are and how much bail out money you need. I don't even care if you are in danger of a default; NOTHING is worse than a bank run that leads to every Tom Dick and Harry withdrawing all their savings at the same time.

Fractional Reserve Banking requires that no bank runs take place. Bank run = System collapses.

To directly erase money from savings accounts is a direct and unmistakable signal to begin a Bank-run intentionally. Which means it might as well be a suicidal move.

If there are no savings in banks, then there are no fractional reserves period.

Even though they backed off for now, the damage is done. The EU has shot themselves in the head.
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Old 2013-03-22, 04:16   Link #15
AmeNoJaku
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Quote:
Originally Posted by Vallen Chaos Valiant View Post
The priority of any government concerning financial policy should be to prevent a bank run.

I don't care how in debt you are and how much bail out money you need. I don't even care if you are in danger of a default; NOTHING is worse than a bank run that leads to every Tom Dick and Harry withdrawing all their savings at the same time.

Fractional Reserve Banking requires that no bank runs take place. Bank run = System collapses.

To directly erase money from savings accounts is a direct and unmistakable signal to begin a Bank-run intentionally. Which means it might as well be a suicidal move.

If there are no savings in banks, then there are no fractional reserves period.

Even though they backed off for now, the damage is done. The EU has shot themselves in the head.
They didn't back out, Germany and the IMF insist on seizing about 6 billion euros from all the banks (though it is unclear if that would be only from large deposits), since Cyprus hasn't come up with any alternative that they consider worthy to discuss... in between Denmark has also seized a fraction from bank deposits of two banks back in 2011.

But yes, I generally agree, like most plans that IMF and Germany came up with ended up destroying the countries they claimed to be helping.

I disagree in principle that any state should nationalize private sector flops, like Greece did and destroyed what little was at least working there, and generally since states decided to base their wealth in private sector lending, now they can not just let banks fall... what they decided to do in Cyprus puts the whole banking system into even greater risk, then Lehman Brothers did.
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Old 2013-03-22, 04:48   Link #16
Vallen Chaos Valiant
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As it stands, Cyprus has kept their banks closed for a week.

If this drags out to a month, we can be sure the Cyprus banks are finished. Everyone now know a bank run is guaranteed, and the only question is how long they are going to delay it.

I just never expected Cyprus to be the match that lights the powder-keg. All because someone was stupid enough to undermine the very concept of banking. In the end it wasn't chronic mismanagement but a critical error that blew it all.

People need to believe their savings are protected. That Trust is the essence of all financial transactions. The trust doesn't have to be based on reality, but it had to be believed. If you rip that illusion away, banks cease to BE.
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Old 2013-03-22, 06:46   Link #17
ganbaru
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Russia rebuffs Cyprus, EU awaits bailout "Plan B"
http://www.reuters.com/article/2013/...92G03I20130322
Quote:
Russia rebuffed Cypriot entreaties for aid on Friday, leaving the island's increasingly isolated leaders scrambling to strike a bailout deal with the European Union by next week or face the collapse of its financial system.
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Old 2013-03-22, 07:36   Link #18
Vallen Chaos Valiant
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EU either bail them out with a trivial sum or risk catastrophic bank runs that may spread.

They can risk it by letting Cyprus fail assuming it is too small to matter, but that's a gamble I think the EU is not willing to attempt.

Oh, and it is interesting that the original plan to take money from all the savings accounts has been unanimously rejected, even by the people who created the plan. So Cyprus politicians essentially realised they messed up and is back-peddling as fast as they can.

But the damage is done. There will be a bank run, the week long banking holiday and counting, makes sure of that.
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Old 2013-03-22, 10:55   Link #19
monsta666
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The idea of putting a bank levy on savings accounts to fund a bailout is tantamount to theft. What is more this policy goes against the basic promises made in the aftermass of the 2007-2008 financial crisis when various banking reforms were put in place to insure that any accounts upto €100,000 would be insured. This proposal breaches this agreement and thus breaks the trust between banks and depositors that their funds will not be raided in the next bailout. How anyone can justify this course of actions is beyond me. The depositors of these banks have no influence in the lending practices of the bank so I fail to see how they can be held responsible nevermind punished for extravagant spending of other parties (be it the banks or other customers). The banks have a lot of tools and resources to measure and assess risk so the argument of ignorance are not really valid. Sure we can also blame irresponsible lenders but since the banks have more sophisticated tools to identify risk the main blame should lie with them. Yet as we have it, it is the debtors and not the creditors (banks and bondholders) who are getting the shaft here.

As to the issue and morals of repaying debt while I can understand it is important to pay ones dues there is a important caveat that is often not said in this debate. When paying someone back the moral obligation to pay them back is only really applicable if the lender actually owns the asset or cash in question. Due to the way commercial banks lend money out of thin air through the fractional reserve system most of the money lent was not owned by them to begin with. It was created into existence. If the banks lend money that is not theirs then it raises the issue of whether it is morally right they should demand payment with interest. If I borrowed my mates car but lent out to you with a charge would that be morally right? In any case though it is somewhat academic because a lot of the debt we see today will never be repaid. Politicians and banks have to acknowledge this fact and find a more equitable way of distributing the loses. Problem is no one wants to hold the empty bag when the music stops so they will try and shift the losses to the weakest parties who are less able to defend their own interests.
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Old 2013-03-22, 11:02   Link #20
willx
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^ You do understand that as a depositor, beyond your deposit insurance, you're basically a junior unsecured claim against the bank right? Cyprus got bullied a bit by the EU, pushed back and they will eventually negotiate something slightly more palatable.

The big mistake hurt was an attempt by the EU to get the government of Cyprus to void its own deposit insurance limits.
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