Exclusive: Euro zone call notes reveal extent of alarm over Cyprus

So Cyprus is asking for more money but it won’t even take part in the call?

The reality is the the euro zone’s crises is seen more in the decision by technocrats to insist that Cyprus’s parliament vote to take a percentage of every savings account in the country than it is in the refusal of Cyprus’s parliament to do that. The separation of European technocrats from political realities has long been a serious weakness of the EU, and it is now seen as a principle factor contributing to the euro crisis.

Cyprus is geographically located in Asia — it never had any business in the Eurozone. Russia needs it for 3 reasons: 1. as its most important offshore location; 2. as a source of vast natural gas deposits; 3. as replacement of its only Mediterranean navy base in Syria. Russia could easily finance the small island if it left the EU.

pbgd@actually cyprus located in asia and especially bordering with china and japan…..

Waterloo

Cyprus gas is going to the russians, europe already depends on russian gas, russians will get a naval base in cyprus, they will skyrocket gas prices next winter in europe and make up the invested money, and in the future control most of the gas supply to europe. genious! i just hope atleast this time germans learned and dont invade russia in summer clothes. it is so frustrating they dont learn, never learn,push push push until the end, their end!

Why they do not ask the clients of the two banks instead of imposing a once off tax if they are willing to invest and how much in bond with a good enough coupon rate backed with shares from the future expoitation of gas? Maybe we are taken by suprise from participation and the needed 5.8bn is far exceeded. But even in the case is smaller still it can be significant.

“Euro zone finance officials acknowledged being “in a mess” over Cyprus”. Noooo, actually Cyprus is in a mess over Euro zone finance officials. These guys don’t seem to contribute much to solutions. They could fix it fast by firing them all and turning it all over to the Bundesbank, but the process won’t be pretty. From goat-herder to investment banker to goat-herder in two generations. Still, Cyprus is warmer than Iceland and drier than Ireland.

I am rather proud of our people in Cyprus. It is about time the overt bullying of Northern Europeans, the likes of Germany etc…have been challenged.
It is also about time to once and for all question the distructive neo liberal economic policies being pushed by the EU right wing and resort back to solid Keynesian recovery fiscal policies. Haven’t we learned with decades of failed neoliberal monetarist and ‘trikle down’ garbage tried in the US in the 80′s and more recently during the W. Bush years. Enough is enough….and so what if the Russians get access to the European Economic basin ?? Why should only the ‘West’ be the ‘so called’ protector of economic prosperity ??? or lack thereof in the West.

Go Cyprus….we are a proud people…

So Cyprus banks buy up Greek sovereign debt as recommended by the EU Finance leaders to help support Greece and prevent a default.

The Eu Finance leaders decide that to get a 2nd round of bailout Greece will have to cut their sovereign debt by forcing holders to take a “hair cut” loosing up to 30% of the value.

The banks in Cyprus that took this 30% “hair cut” are now in trouble because of it.

So the EU Finance leaders have decided that depositors in those banks need to take a “hair cut” to their savings in the form of a “one time” tax of 6-9.9% because some of the investors are from outside the “Euro Zone” (read from Russia or the UK) and thus need to pay the price for saving the banks that the EU Finance leaders screwed over in the first place?

Somehow this sounds like the worst kind of circular logic bound to cause a major spiral of destruction in the Euro zone.

Cyprus… Do it.

Freedom or death.

This sounds like the proverbial small hole in the dike that ends up unravelling the whole structure. I hope i am wrong.

I see a lot of anger expressed against Eurozone officials and I feel it is unnecessary. Though I am shocked by the specific method (idea of levy on bank deposits) suggested by them to raise the part of funding, they are still trying to extend their helping hand to Cyprus by committing nearly two thirds of the overall package and trying to pull Cyprus out of this crisis situation. Else, Cyprus would have been worrying about raising 17b (instead of 5.8b) by now.

I hope that Cyprus doesn’t waver.

I also hope that helped comes from outside of the Euro Zone. Russia and Great Britain stand to gain immensely from the German intransigence. Natural gas reserves are worth the price of admission.

If anyone thinks that Greece will not follow suit… You’re smoking some powerful stuff. Italy, and Spain will also be gone.

Well well…the EU zone officials, led mainly by Germany, Holland, Finland e.t.c, with no offence to the whole of these nations…

They offer a hand of help, by grabbing a percentage of ALL deposits on the island. I repeat, of ALL deposits on the island.

Behold ladies and gentlemen the unity that exists in the EU today. They have approved something never being done before, and something that opens up the path for similar thefts in the rest of the Eurozone.

I want this to be heard loud and clear. They started sending faxes to Cypriot business owners on the island, advertising “secure funds” and “high AA+ secure standards”, urging people to move their funds to their economic institutions.

I will very clearly state the following. We have accused by mainly the Germans that we are the money-launderng depot for Russian investors. I believe strongly that the inventors of money-laundering are others. The findings of researches on the above matter have showed that Cypriot banks are a lot cleaner than many German banks and financial institutions.

I am extremely proud of my country, and I believe we can become the ticking bomb in the whole “North/South Europe” scheme of things in the European scene.

I will close my post with the following words, which were seen on a banner outside the Cypriot Parliament two days ago.

“If they dont let us dream, we will not let them sleep”.

Jeez, Cyprus is in Northern Africa and 1/2 the island was taken by Turkey. EU will never get their money back unless they invade or the UN orders Turkey to. Cypriots are just enjoying the sun and wine laughing.
I would be to.
Not all of northern Europe buys gas from the Russians. Holland lays over it’s own pool of natural gas and is energy efficient. Would there be a problem if they, Cyprus, had lived within their means?

komiates,
Please explain how the EU right wing would/could be using neo liberal economic policies? That’s about as logical as dry water or vegetarian beef.
Now, even if such oxymoronic policies were the issue, you had no problem with them as long as you were on the receiving end but now that the house of cards is shown to be what it has always been known to be you want someone else to finance a ‘do over’?
What economy Cyprus has ever had has been based on money laundering and sex tourism. It certainly has not grown to its dizzying heights based on goat cheese, cotton and olive oil. It has grown due to crime and support of crime. Even if they didn’t directly commit the crimes they benefited from being able to skim off of the ill gotten gains.
Tell me, how’s that sex trafficing thing working out?
Yeah, I guess you are a proud people.

Any resolution for Cyprus must not include taking funds from private depositors’ accounts. Seriously, ANY governmental body that mismanages its economic policy needs to take responsibility for its own actions and strike deals at the National level – stealing private funds from average citizens to cover faulty investments and debts is criminal and should never be part of any deal. That is simply insane. Further – global finance policy needs to eliminate off-shore banking regardless of nation or shore…banking deposits and taxation need to be up front and absolutely transparent. This goes for Bermuda, the Caymans, Delaware, Cyprus, Switzerland and any other territory. Period.

To my friend Vuenbelvue

You must be smoking some pretty good stuff, I cant see it any other way…

You are implying that the EU should invade to get their money back? Or if Turkey does so? But Turkey already invaded. Again? Where do you buy stuff like the one you smoke? Must be pretty good…

The Germans are becoming increasingly scary. Seems they are willing to damage the entire EU as long as they don’t have to support one of their members. I don’t blame Cyprus for heading to Russia after the attempted cash grab from the Cypriot people. Even Putin is proving more humane than Merkel. I hope Germany’s economy goes into a major stall when they can’t sell their Mercedes and BMWs to rich Greeks and Cypriots, and now Italians and French…..so keep it up Germans, by all means. Germany has twice been bailed out of economic morass and this is how they behave when it is their turn to contribute to the solution? But Germans do seem to enjoy grabbing others’ property.

Vuenbelvue: Would there be a problem if they, Cyprus, had lived within their means?
Luckylook: do you have any proof they aren’t?
Vuenbelvue: No
Luckylook: That is because they are, at least most of them. The government dept is 70-80% of the GDP and this is after the Greek bond haircut, which cost Cyprus Banks $4.8 billion. The haircut was 2 years ago and significantly impacted on the economy. The dept increase during this period from about 50%. So let me ask you something. If the haircut didn’t take place, or the haircut was correctly weighted among EU nations then Cyprus wouldent have a problem. It is clear that Germans are after the Natural Gas resources of the Island.

Luckylook So Cyprus did not benefit from any loans made to Greece that would have been used for any infrastructure work on the island?
Factalone The government exists because of the people and normally has the right to tax and defend. So you are saying the people don’t have to repay what the elected officials decide to do? Does that even work?
Luckylook and Marios The government in the US doesn’t allow the sale of Hash or opium here so you beat me on the good drugs. The haircut you mention is the owners of the debt are accepting less interest than they originally thought they would receive when buying the debt. Did you take a loss? Here it is called buying high and selling low.

So,Russia will buy Cyprus and NATO and the UK will lose the right to use Cyprus for a base,whereas Russia can set up a Naval Base in Cyprus.

Well done EU-half way to WW3.