Cyprus scrambles to avert meltdown, EU threatens cutoff

Comments (48)
BlueCannon wrote:

No problem. Russia may ship their cash currency in containers as many as Cyprus wants.

Mar 20, 2013 4:53am EDT  --  Report as abuse
Saristas wrote:

What the hell is happening in the world, where did the money go..?

Mar 20, 2013 4:58am EDT  --  Report as abuse
VonHell wrote:

Imagine the guys that “invested” the russian money in greek debt expecting high interests to distribute the profits among themselves in form of bonuses and the major shareholders in form of dividends… 5 years from now if the deal is off… anyone alive?

Mar 20, 2013 5:07am EDT  --  Report as abuse
ctyankee57 wrote:

Not where did it go, what is it worth??

Mar 20, 2013 5:19am EDT  --  Report as abuse
DanEuro wrote:

I was very proud of the CY parliament decision. The precedent of a government (or the EU) robbing people’s bank accounts in order to solve other problems should never have been suggested. What is the purpose of deposit insurance if the insurancer can rob the depositor whenever they need? How many idiots do you think there are around the world who would trust any European banks or governments if these had actually took place. Congratulations for Cyprus for standing up for its’ people and for the European Union. Shame on the idiots (ECB, IMF and Germany/Holland/Finland) for even suggesting theft as a solution for any problem.

Mar 20, 2013 5:56am EDT  --  Report as abuse
ALALAYIIIAAAA wrote:

to get a good job in cyprus it is prerequisite to speak as a second language russian not as fluent as english of course but in advanced level.many russian financial institutions and companies operate on the island.
it was an expected decision for those who know and the natural gas goes to russia.soory mrs merkel….

Mar 20, 2013 6:02am EDT  --  Report as abuse
Mars_HQ wrote:

It would be interesting to compare the different style of strings attached between the EU bailout proposal for Cyprus, vs a Kremlin bailout proposition. Naturally, the man on the street will want his bank and govt to be bailed out for free, no impact whatsoever and life goes on, etc.. but sadly, it looks like most everyone involved who has a interest in normalized and sustainable Cypriot finances will need to take some form of hit. What I dont understand though, is why there was not a more graduated form of depositor tax proposed. Something like 500k+ gets taxed 12%, 200k-500k 10%, 100k-200k 7%, 50k-100k 5%, under 50k 3%, less than 3k or something is exempt, etc. Kiss that tax haven goodbye.

Mar 20, 2013 6:15am EDT  --  Report as abuse
DanEuro wrote:

What Mars_HQ and others are suggesting is not a Tax. A Tax is announced in advance. You can pay it or you can not do the business (or own the property, etc… your choice). A tax is not confiscation of money that the government promised through deposit insurance was guaranteed. That is called something else: theft. 100,000 Euros was promised by the government (and the ECB) under the deposit insurance program. If the insurer (the government) can steel the money it is insuring, what is the insurance worth? How many idiots do you think exist around the world which would put their money in the EU after this? Hats off the the people and parliament of Cyprus for saying to the Eurocrats: This will not START here in Cyprus!

Mar 20, 2013 6:56am EDT  --  Report as abuse
daddywarbucks wrote:

Envision claw back UN pensions along with “… dismantlement and restitution of its assets.’

UN/League of Nations, both expensive failures

The IMF’s Gold Gambit –

WSJ, By JUDY SHELTON ,April 28, 2009 The fund’s misuse of bullion reserves is crucial to its plan to use the financial crisis to expand? its power.

‘While IMF officials insinuate the receipts would be used to help poor countries, the real goal is to set up a permanent endowment fund for the IMF.’

‘… Congress should call for the IMF’s dismantlement and restitution of its assets.’

Since 1945 the UN is:

… responsible for the maintenance of international peace and security. (?)

… responsible for cooperation between states on? economic and social fields (raising the general standard of living, solve economic, social and health problems, promotion of human rights, culture and education, as well as humanitarian aid). (?)

… how’s that working out?

The IMF is the third biggest holder of gold (yep) after? the USA and Germany (from who did? they get it?) The IMF is an agency of the UN. The IMF is ‘supposed’ to be helping Cyprus, instead the IMF (that pays no tax and is not subject to the laws of any country) is enriching and empowering itself on the backs of citizens savings and taxes.

Remember this?

‘In fact, her IMF salary of $467,940 plus an $83,760 additional allowance is not subject to any taxes. See Christine Lagarde, Scourge of Tax Evaders, Pays No Tax. No taxes is the norm for most United Nations employees? … IMF, vaffanculo !

Mar 20, 2013 6:58am EDT  --  Report as abuse
BobStreb wrote:

Let the banks fail. Cyprus will have a better shot at an economic recovery once the bankster/government fraud has been eliminated from the equation. Follow Iceland’s example, and prosper!

Mar 20, 2013 7:13am EDT  --  Report as abuse
DanEuro wrote:

Iceland was responsible. No one suggested that Iceland would pay its’ bills by stealing money from innocent savers.

Iceland was not required to steel money from it’s citizens to receive assistance. Only Cyprus. Why? (By the way, most of the stolen money would not be from Russians… and why is it ok to steel from Russians… because SOME of them are criminals…. then lets also steel from every country… cause some of them are ALSO criminals.)

Mar 20, 2013 8:25am EDT  --  Report as abuse
AFL wrote:

Most what Russia will give to Cyprus will end up in the same hands, most of the Russian money end up – international banking elite. Look at how poor most regions in Russia are, people are still living in dire conditions everywhere except for some centers. Compare it with the rate of oil (and other nonrenewables) exports you`ll see that most of the profits end up where they initially were destined (from the revolution propped by international fincanceers) to go – Goldman, Morgan etc…

Mar 20, 2013 8:42am EDT  --  Report as abuse
suemarie000 wrote:

Its a big deal to outright take someone’s money AFTER paying the taxes that were required by law. And then steal people’s deposits and call it tax is just too much even for socialists. If this does occur….it WILL spread and I am at a loss at what Americans should do. Maybe stock up on items that are needed that cost money. If all money is gone or useless….how will you buy staples? You don’t. You barter. So….stock up on everything you can but especially one item that will be rare….cigarettes, chocolate, whiskey etc….to barter for meat, milk, eggs, gas, etc. It is a shame that it has come to this but when you have failed leadership in the White House who could not get us out of this slump…what do you expect? American voters have now made the same mistake twice and we are going to pay dearly for that.

Mar 20, 2013 8:44am EDT  --  Report as abuse
otrcomm wrote:

Would some at Reuters please do a detailed report on how Iceland dealt with its deficit issues and its banks?

Mar 20, 2013 9:05am EDT  --  Report as abuse
tbro wrote:

I have to agree suemarie000, but this was coming regardless of who got elected. The election was simply a choice of how soon and in what form the crash will take. As for the EU’s stealing depositors money, Russian gangster money of not, it’s just plain stupid, and wrongheaded on so many levels!

Mar 20, 2013 9:19am EDT  --  Report as abuse
PKFA wrote:

Cyprus is a smoke screen. Where are the stories about the 4 year claw back of small business tax incentives in California (with penalties!)? Sure, read about Cyprus thinking it can’t happen here, but it already IS. And, Saristas, the money goes to the political class (looters) for their own benefit and for redistribution (moochers).

Mar 20, 2013 9:51am EDT  --  Report as abuse
Jocomus wrote:

The Cypriot finance minister should have gone to cash-rich China for loan and aid. At least the Chinese yuan stands a better chance than rupee to convert into euros, via underground channels in Shenzhen or Hongkong.

Mar 20, 2013 10:10am EDT  --  Report as abuse
PeriSoft wrote:

@suemarie000 – Cyprus rejects an EU demand to haircut depositors’ accounts, and you blame Obama and suggest that Americans stock up on whiskey? Really?

The EU’s demands were absolutely absurd – petulant, regressive, financially inconsequential, and tailor-made to cause bank runs and investor panic – but suggesting that the result will be the complete collapse of the very idea of all money is… a tad alarmist, shall we say?

At any rate, if the world is reduced to a barter economy, trust me – you’re not going to want to barter that whiskey. You’ll be drinking it. And you might as well, because frankly, if that happens, the vast majority of us will be dead. And if Hollywood and video games have taught me anything, it’s that the survivors, in spite of the complete lack of transport infrastructure, fuel refining capability, or petroleum extraction facilities, will build large, cumbersome, heavily-armed vehicles and chase one another around the desert for no apparent reason. Strong men will engage in hours of hand-to-hand combat over a 20 ounce Evian, and the service sector will consist entirely of gas stations, quick-lube shops, and tattoo parlors, and everyone will have elaborately spiked hair despite there being no grooming facilities or hair spray available.

Come to think of it, that’s as good a reason as any to oppose these kind of reckless finance decisions. Someone should tell the EU people.

Mar 20, 2013 10:13am EDT  --  Report as abuse
ofilha wrote:

It’s time to leave the EU. It will be tough at first but later on it will be liberating.

Mar 20, 2013 11:08am EDT  --  Report as abuse
MikeyLikesIt wrote:

What is truly sad about this situation is that another “emergency loan” will do nothing to fix the underlying issues in Cyrpus or Greece or Spain or wherever.

All these loans will do is kick the snowball a little further down the hill, and we all know what a downhill snowball will become.

At this point I honestly don’t know what the cure is for the financial problems the world is facing. Every option comes with its own pitfalls.

Mar 20, 2013 11:12am EDT  --  Report as abuse
ofilha wrote:

@DanEuro,
Good job, i like what you say. This kind of behavior is not only unethical, as you said it is theft, but it is even worst, it dismantels any kind of social contract there is including legal contracts. It starts the break down of social order in a society.

Mar 20, 2013 11:15am EDT  --  Report as abuse
DanEuro wrote:

PeriSoft: Funny comments, but the crisis should not be taken too lightly either.

There are only two thing we must learn from this:

1. EUcrats (ECB, IMF, Germany, Holland… etc) are idiots and/or interested only in their own political welfare and not for the welfare of all Europeans. All those associated with this Cyprus bailout blackmail attempt should be fired (they wont be, but for the good of Europe, they should be).

2. The only way to get out of a serious loss of confidence in the banking system of Cyprus and the European Union now is to highlight the fact that the Cypriot parliament REJECTED the plan to seize money from its’ population and REJECTED the idea of bypassing the Deposit Guarantee System (for deposits up to 100000 Euros), and this is a lesson for all the world that Europe will always respect private property.

A new bailout should be offered to Cyprus. And the world should know that the effort to seize private property DID NOT succeed even though it was pushed by some of the most powerful people in Europe and against one of the smallest economies in the E U.

Mar 20, 2013 11:16am EDT  --  Report as abuse
ncsuMECH95 wrote:

Deadbeat Cyprus wants a new loan approved from Russia (thru the IMF), or they will seize money out of Russian accounts in Cypriot banks (along with everyone else’s money).

Cyprus is similar to an addict wanting to borrow more money. 1 Lend it to them, and they will not change. 2 Refuse to lend it to them, and then they will steal it.

Why are these people broke…

They would love to just seize the money out of the foreigners accounts, while leaving their voting citizens accounts alone. That would be something! (international incident).
All this after setting policies to attract foreign investers to their banks.

Mar 20, 2013 11:26am EDT  --  Report as abuse
Rich_F wrote:

the banking sector in any country has their tendrils deep into all financial aspects of said country, therefore they are for all intents and purposes too important to fail. sure you can let a few small banks go under but the banking system must stay intact and there will be a good % of institutions that must be saved no matter the “cost”. how do you save banks? you have to get them healthy. that comes in many forms including reducing debt, increasing capital, guarantees which perform the same thing, etc. this is why banks should be nationalized. they are as important to the health of a country as national defense. u can see what’s happening all over the world when profits are privatized and losses are socialized. the citizens have zero upside and all downside.

Mar 20, 2013 11:33am EDT  --  Report as abuse
gee.la wrote:

Cyprus is a good lesson that everyone needs to learn. There is no free luncheon. You can get it in advance, but you have to pay later or to wash mountains of dirty dish, instead. Now, all the dirty dishes are waiting. Cypriots are still trying their luck and the outcome is in vain.

“People don’t want to follow the straight and broad ways, instead, they like narrow and chancy lanes.”Lao Tzu said.

Mar 20, 2013 11:37am EDT  --  Report as abuse
DanEuro wrote:

gee.la, what you wrote is non-sense. Cyprus is in trouble because two large banks in Cyprus invested heavily in Greek government bonds. Greek bonds were cut by the EU as part of the rescue package for Greece. Cyprus is a victim of this and the banks lost billions. That’s it. True, the Cyprus government is too big, like most European governments (not worse). Otherwise, the Cyprus economy is doing about the same as most of the rest of Europe. To say because of that, anyone with a bank account in Cyprus deserves to be robbed… is simply wrong.

By the way, Cyprus has many Russians because of the warm weather and similar religion/culture. Some Russians are indeed criminals, like some Germans, Dutch and Finish are criminals as well (I mention those 3 countries for a reason).

So, since we can all agree that some Germans are criminals, I suggest we “tax” 10% of all the money in German banks.

Who is with me? Let us make that proposal to Ms. Merkel (her people seem to like the idea… except maybe the ones with bank accounts in Cyprus)!

Mar 20, 2013 12:03pm EDT  --  Report as abuse
DanEuro wrote:

Doc62 seems to be an expert on Cyprus. But before posting stupid comments, he should learn to spell the name of the country… or maybe he was taking about another place, called Cypress??

Mar 20, 2013 12:06pm EDT  --  Report as abuse
WAKEUPtoday wrote:

I have read all the comments and articles on the Cyprus financial issue lately but I beleive no one seems to understand that this is a game that started back in 2004.
Troika proposed that the Cypriot government steels around 6 billion euros from the depositors to minimize the amount of the bailout. In their formula they claim that for a debt to be viable, it has to be less than 120% of the GDP. They knew (or even they planed it so) that most foreign and even a lot of the local depositors would not appreciate such a move and would transfer their money elsewhere. This would directly decrease the Cypriot GDP by at least 10% (or even double that if you take into consideration the side effects) which would then make the loan unviable again (based on their formula). The same happened in Greece when they proposed more taxes and more taxes, but instead of the government receiving more money, the income droped to a lower level because people were left with no jobs and money so there was less spending which translates to less taxes.
The problem is not really of economic nature. Troika wants to have the upper hand on the Cypriot gas and even impose a solution to the Cyprus problem based on third countries’ interests rather than the Cypriot people (see 2004 referendum).
Europe actually created the problem to the Cypriot banks when they were forced to lose more than 5 billion euro in the Greek “haircut” and then they said to the Cypriot government that they have to find a solution to the problem that they created.
Most of the people understand that their proposal was disastrous. For Cyprus and even for the rest of Europe, especially the european finacial institutions. Cyprus is a unique case they said. Like Greece, Portugal, Spain and Italy. They were also treated uniquely. Who knows what next from Troika to their next unique country? By the way, did you see any progress within the 5 European countries they have “helped”?

Mar 20, 2013 12:17pm EDT  --  Report as abuse
gee.la wrote:

“No regulation or management statewide; no farmers in land to plant; no grains in barns. But they are wearing luxurious clothes and sharp-blade sabers; they have been eating and drinking until they dislike to eat and drink more; they have more than enough private prosperities. This is called ‘Thieving’.” Also said Lao Tzu.

Mar 20, 2013 12:18pm EDT  --  Report as abuse
WAKEUPtoday wrote:

I have read all the comments and articles on the Cyprus financial issue lately but I beleive no one seems to understand that this is a game that started back in 2004.
Troika proposed that the Cypriot government steels around 6 billion euros from the depositors to minimize the amount of the bailout. In their formula they claim that for a debt to be viable, it has to be less than 120% of the GDP. They knew (or even they planed it so) that most foreign and even a lot of the local depositors would not appreciate such a move and would transfer their money elsewhere. This would directly decrease the Cypriot GDP by at least 10% (or even double that if you take into consideration the side effects) which would then make the loan unviable again (based on their formula). The same happened in Greece when they proposed more taxes and more taxes, but instead of the government receiving more money, the income droped to a lower level because people were left with no jobs and money so there was less spending which translates to less taxes.
The problem is not really of economic nature. Troika wants to have the upper hand on the Cypriot gas and even impose a solution to the Cyprus problem based on third countries’ interests rather than the Cypriot people (see 2004 referendum).
Europe actually created the problem to the Cypriot banks when they were forced to lose more than 5 billion euro in the Greek “haircut” and then they said to the Cypriot government that they have to find a solution to the problem that they created.
Most of the people understand that their proposal was disastrous. For Cyprus and even for the rest of Europe, especially the european finacial institutions. Cyprus is a unique case they said. Like Greece, Portugal, Spain and Italy. They were also treated uniquely. Who knows what next from Troika to their next unique country? By the way, did you see any progress within the 5 European countries they have “helped”?

Mar 20, 2013 12:19pm EDT  --  Report as abuse
frek149kie wrote:

This is the most dramatic indication so far as to what will happen to countries that fund socialism with debt. Increased theft from the so-called “rich” and corporations wont work either. Wealth goes where it is welcome.

Mar 20, 2013 12:26pm EDT  --  Report as abuse
DanEuro wrote:

gee.la: Have you ever been to Cyprus, because you are not writing about the same Cyprus I know.

Mar 20, 2013 12:31pm EDT  --  Report as abuse
gee.la wrote:

Lao Tzu wrote the two clauses in one paragraph. In the past, I was not very clear about the internal logic connection between the two. Now I have no question, thanks to Cypriots.

Mar 20, 2013 12:36pm EDT  --  Report as abuse
gee.la wrote:

For the past 2,500 years, many states haven’t changed dinky. It is amazing, isn’t?

Mar 20, 2013 12:50pm EDT  --  Report as abuse
327 wrote:

why don’t they just make the bankers bail them out?

Mar 20, 2013 1:02pm EDT  --  Report as abuse
DanEuro wrote:

gee.la: Your admiration for Lao Tzu is understood. I am not sure you realize that your Guru was NOT actually referring to Cyprus in regard to these quotations. Nor would any reasonable person equate them to Cyprus. You might consider learning something about the country (Cyprus) you are condemning before submitting another post.

Mar 20, 2013 1:11pm EDT  --  Report as abuse
FreedomRadio wrote:

I’m sure the Russian Navy would like to have a presence as well.

Mar 20, 2013 1:12pm EDT  --  Report as abuse
gee.la wrote:

The ‘North Sea’ is an artificial, virtual zone between the Sun and the Earth.

Mar 20, 2013 1:38pm EDT  --  Report as abuse
johnbloggs wrote:

By abandoning Cyprus to its fate,the EU has just made WW3 more likely.
Russia will just take over the Eastern Med.

Mar 20, 2013 2:11pm EDT  --  Report as abuse
Garys_opinion wrote:

Possibly Russia could buy Cyprus, they’d straighten things out real fast!

Mar 20, 2013 3:12pm EDT  --  Report as abuse
the_Gaul wrote:

DanEuro: You’re too thoughtful. gee.la is just tweaking you.

Mar 20, 2013 3:29pm EDT  --  Report as abuse
GFR wrote:

One has to wonder what the Cypriot government is thinking by extending the bank holiday until Tuesday. If private accounts are really going to remain unmolested then why not open the banks immediately? The longer that people have to wait, the more nervous they will get. Expect long lines at ALL Cypriot banks on Monday night.
.
The only way to stuff this genie back in the bottle is to make it worthwhile for people to risk keeping their funds in the banks. I would suggest a 1% bonus on all accounts that carry a positive balance for one week past Tuesday. A further 1% on all positive balances carried for one month past Tuesday. After that people MAY have enough confidence that the Cypriot government has realized their error that there won’t be a run on the banks.
.
If they DON’T give people an incentive for staying in EVERYBODY will pull ALL there cash “just in case”. When that happens it will be “Katie bar the door” throughout Europe, and possibly in the US.

Mar 20, 2013 3:50pm EDT  --  Report as abuse

So you move to Cyprus for its pleasant climate, laid-back administration, lax banking rules and a general attitude of good time on credit. You know all this full well. As you make your bed, sleep in it.

Mar 20, 2013 3:55pm EDT  --  Report as abuse
DanEuro wrote:

the_Gaul: Yeh… I get that (now).

MauriceCalvert: See my comments above to gee.la. You 2 should get together.

BYW: I am familiar with Cyprus banking rules. Not so lax in last few years. More lax in countries in Central Europe: Czech Republic, Slovakia and Slovenia (also Euro), and Hungary. Cyprus financial regulations are equal to most other European ones (although it does happen in Cyprus as it does in other countries that bankers and criminals find loop-wholes or bribe officials). The myth of Cyprus as one big hotbed of crime or Russian mafia is complete rubbish.

Mar 20, 2013 4:28pm EDT  --  Report as abuse
pbgd wrote:

It serves those crazed European Empire builders right who insisted on incorporating the Asian island of Cyprus. That not enough they are seriously thinking of annexing two additional Asian countries, to wit Turkey and Georgia.

Mar 20, 2013 7:52pm EDT  --  Report as abuse
daruma wrote:

Strangely, all this happens when gas has been discovered in the East Mediterranean roughly between Cyprus, Syria and Israel.

Russian Gazprom has already managed to get an agreement for the exploitation of the gaz fields in the Israeli zone.

If Assad manages to stay at the bar, Russians will probably have access to Syrian gas field too and they might also have had Cyprus gas because they are already well present at the island.

Something had to be done, EU tried to do something and as usual failed.

I hope that Russians bailout Cyprus (they have the money for that) get the gas and a naval base in Cyprus.

Maybe some of you remember that Island also asked for Russian money back in the days, however they did not agree on the terms (which involved a proposed Russian military aviation base)…

Mar 20, 2013 8:17pm EDT  --  Report as abuse

The scary thing about thisis that the Obama administration, believe me I know no matter whose administration it is this would happen, has talked about taking over pensions and 401ks and all kinds of moneymarkets for private retirements as well as public. There are around $15trillion out there in the U.S. in retirement funds. The Eye of the Tiger is watching and wonderering how to pounce

Mar 21, 2013 8:57am EDT  --  Report as abuse
ereilad wrote:

Cyprus a satellite of Russia?

Mar 21, 2013 9:07am EDT  --  Report as abuse
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