EUROZONE - CYPRUS BAILOUT TIMELINE

Well, well, well - late night taxis stuffed with bags of cash, rumours of members of parliament being given stashes of silver bullion, the odd gold bar, black diplomatic bags filled with Swiss Francs and one of the richest residents of Cyprus - a lady who owns a Supermarket - trying to leave by plane with a bag full of 5million EUROS.... Welcome to the island of CYPRUS... REPORT by CHRIS EVERARD...

Dirty filthy black-suited politicians in a late night secret meeting of deals have SOLD OUT the people of this paradise island - They struck a crucial deal for a multibillion-euro bailout in return for a massive raid on deposits at its two largest banks after marathon talks in Brussels overnight.

In return for the bailout, Cyprus will close down one of its two biggest banks and 'restructure' a second. They cash syphoned out of the baks is already being re-distributed as bribes to ministers and lobbyists...

Their plan sees bank accounts owned by Middle Class and Working Class people getting emptied into the pockets of millionaire tax-evading shark-members of parliament... Anyone who has skimped and saved more than €100,000 (£85,400) at the Bank of Cyprus will lose as much as 40 per cent of their savings. MERKEL and the German Banksters struck a sick deal where Cyprus must 'shrink' drastically its tax haven banking sector and cut its budget, throwing innocent people on the streets and making the people revolt in the streets.

This 'bail-out' is yet another LOAN to saddle future generations with yet more crippling taxes.

Date : 3/16/2013

Christine Lagarde, managing director of the International Monetary Fund (IMF), attended the meeting: “I welcome the agreement reached today to address Cyprus’ economic challenges. The IMF has always said that we would support a solution that is sustainable, that is fully financed, and that appropriately allocates the burden sharing.” Cypriot savers hit as eurozone agrees €10 billion bail-out 

Date :3/17/2013

Tony Collings, a British businessman whose savings might be taxed, said if the move was "extended throughout Europe it effectively, it'll withdraw from the principle of the eurozone." Cyprus bank levy 'sleazy backdoor way of revaluing the euro' 

"The Eurogroup considers that in principle financial assistance to Cyprus is warranted to safeguard financial stability in Cyprus and the euro area as a whole," said Jeroen Dijsselbloem, president of the Eurogroup meetings of the 17-nation eurozone's finance ministers, after almost 10 hours of negotiations. "A default of Cyprus and banks would have direct stability implications for Greece and indirect consequences for the wider euro area," said Joerg Asmussen, a member of European Central Bank's executive board. "This could lead to renewed financial instability, requiring further mitigating polices and to a further loss of jobs and growth in the eurozone."Eurogroup defends Cyprus bail-out 

 Marios Skandalis, vice president of the Cyprus Institute of Certified Public Accountants, added: 

"There is a very high risk that this could be the end of Cyprus as a strong and reliable financial centre." 

"The whole banking system is based on trust. If the trust is lost, the whole system is going to collapse," he said. 

"The damage will be long-lasting," said Fiona Mullen, an economic analyst specialising in Cyprus. Cyprus delays debate on bailout 

Date : 3/18/2013

Forbes has called this "Probably the single most inexplicably irresponsible decision in banking supervision inthe advanced world since the 1930s."  

CEO of Saxo Bank, Lars Christensen, did a great job of explaining how incredibly damaging this move by the IMF and the EU truly is...  This is a breach of fundamental property rights, dictated to a small country by foreign powers and it must make every bank depositor in Europe shiver. Although the representatives at the bailout press conference tried to present this as a one-off, they were not willing to rule out similar measures elsewhere - not that it would have mattered much as the trust is gone anyway. It is now difficult to expect any kind of limitation to what measures the Troika and EU might take when the crisis really starts to bite. if you can do this once, you can do it again. if you can confiscate 10 percent of a bank customer's money, you can confiscate 25, 50 or even 100 percent. I now believe we will see worse as the panic increases, with politicians desperately trying to keep the EUR alive. Depositors in other prospective bailout countries must be running scared - is it safe to keep money in an Italian, Spanish or Greek bank any more? I dont know, must be the answer. Is it prudent to take the risk? You decide. I fear this will lead to massive capital outflows from weak Eurozone countries, just about the last thing they need right now. 

Jeroen Dijsselbloem, president of the group of euro-area ministers, on Saturday declined to rule out taxes on depositors in countries beyond Cyprus, although he said such a measure was not currently being considered. After The Banksters Steal Money From Bank Accounts In Cyprus They Will Start Doing It EVERYWHERE 

Business Insider noted the “multiple reports which indicated that Germany told Cyprus: Confiscate your depositors’ money or leave the euro zone. That’s a terrible political dynamic, and on top of Italy it exacerbates a bad overall political situation.”  EU summit sparks run on Cyprus banks

Lax banking and a reputation for money laundering have brought the Cypriot economy to its knees – and savers are paying the price, says Alex Spillius Cyprus: a sunny place for shady people 

“The moment the idea is admitted into society that property is not as sacred as the law of God, and that there is not a force of law and public justice to protect it, anarchy and tyranny commence.”

- John Adams The Rape Of Cyprus By The European Union & The IMF

“The raid on bank accounts risks triggering new convulsions in the financial crisis that began in 2009 in Greece,” reports Bloomberg.com. It continues: The [looting] is “a worrying precedent with potentially systemic consequences if depositors in other periphery countries fear a similar treatment in the future,” Joachim Fels, chief economist at Morgan Stanley in London, wrote in a client note. Cyprus government’s ‘great bank robbery’ of private accounts may set off bank runs across Europe

Last year, Der Spiegel magazine quoted a German intelligence agency report which said that “Russian oligarchs, business people and mafiosi” would benefit most from a bailout.Cyprus bailout deal to tax savers wins support in Germany 

“The Cypriot Government is implementing measures to protect its banking sector. You should check with your bank for further information," said the Foreign Office. "We advise those travelling to Cyprus to take different forms of payment with you to ensure you have access to adequate funds (such as pounds, euros, credit/debit cards)”. It added: "Tourists should be wary of carrying large quantities of cash and check their travel insurance policy to make sure it covers them for individual items in case of theft or loss."  Cyprus bailout: cash warning for British travellers , Travel money advice for Cyprus

The financial crisis in Cyprus has been flashing brightly on the radars of the European Union since the rescue deal for Greece. The island had lent billions in Greece and faced huge losses when that country was bailed out by European Union. • See here for a full explanation of Cyprus's financial predicament It is the fifth eurozone member to be saved from bankruptcy, following deals for Ireland, Greece, Portugal and Spain. Cyprus impact: how safe are UK savings? 

Date : 3/19/2013

An article in the Cyprus Mail...

And after all, President Anastasiades had emphatically declared in his inauguration speech that “absolutely no reference to a haircut on public debt or deposits will be tolerated,” adding that “such an issue isn’t even up for discussion.” Finance Minister Michalis Sarris made similarly reassuring statements, arguing that it would be lunacy for the EU to impose such a measure because it would threaten the euro system.

Article by Lucas Jackson described, faith in the global financial system is being greatly shaken...It would be hard to over-emphasize how significant the Cyprus situation is.  The EU demonstrated under no uncertain circumstances that they will destroy the rule of law to maintain their own power.  It was a recognition of tyranny that many of us have always assumed was the case but yesterday became reality. The damage done here is not related to the size of the haircut - currently discussed between 3 and 13% - but rather that the legal language which each and every investor on the planet must rely on in order to maintain confidence in the system has been subordinated to the needs of the powerful elite.  To the power elite making the major decisions in DC, London, Berlin, France, Brussels, et. al., laws are like ice cream, easily melted. Which begs the question, who is next?  Will it be Portugal?  Greece? Spain?  Italy?  France??? Will they impose a “one-time” tax on your bank account?  Your house?  Your stocks and bonds?  Retirement accounts? The Great Cyprus Bank Robbery Shows That No Bank Account, No Retirement Fund And No Stock Portfolio Is Safe 

Süddeutsche Zeitung wrote, “Banks closed, money gone, confidence destroyed. The last taboo of the euro crisis has been broken, and it’s now reaching directly into savings accounts… The crisis surrounding the euro has unexpectedly reached a new level of escalation.”

Handelsblatt declared, “Cyprus sets a precedent. What happens there can also happen elsewhere. In Spain and Ireland, bank bailouts have allowed the national debt to explode to an unsustainable level. There, the euro zone could see tapping into bank accounts as the next step. In principle, no European depositor can remain assured that their bank balance will remain untouched—even in Germany.”

Paul Krugman of the New York Times commented that the levy on investors “is just the beginning! Even with the effective default on deposits, Cyprus will need a huge loan from the troika, and the condition for this loan will be harsh austerity. This looks like the beginning of endless, inconceivable pain.” Cyprus banks close as bailout terms spark Europe-wide crisis 

The Guardian reports on its livecoverage page, "There are fears that the ECB could pull the plug on the country's two biggest banks, by terminating the support provided under its Emergency Liquidity Assistance -- on the grounds that they could be insolvent. But as the WSJ's Simon Nixon explains, Cyprus could be gambling that the ECB won't risk turning the liquidity tap off."  Cyprus MPs vote down government raid on private bank accounts in defiance against IMF and EU central bank 

Date : 3/20/2013

The problems for Cyprus are only just the beginning... "This is not the end of the process, but instead kicks off a further round of negotiation with Moscow and Berlin," JPMorgan economist Alex White wrote in a research note. "The Cypriot authorities wanted to conduct the vote so that they could reaffirm the extent of their difficulties to the Europeans."

The Sun, bank insiders were tipping people off about what was going to happen in the days leading up to the crisis... But Russian oligarchs and big investors emptied accounts in the days beforehand, prompting claims they were tipped off by bank insiders. A source told The Sun: “It leaked out. Bankers warned their best clients. Government officials warned their friends and relatives. “Billions disappeared from accounts in days, most from accounts held by Russians.”

David Zervos, we could see billions more euros withdrawn from banks in Cyprus once they reopen.  There will be mass panic as depositors scramble to reclaim their money before it can be taxed...The die is cast. There is no going back for the Cypriots or the Eurozone leaders. As soon as the banks open in Cyprus there will be billions in withdrawals. The question of course is - "where will the money come from?". Well, if the parliament votes YES, then the Euros will have to come from the Eurosystem. But there is a glitch. The Cypriots have already borrowed 10b euro via the ELA and Target2. How can Mario just wire over 20 billion more (less the 10 to 15 percent haircut) for the Russians, and another 20 to 30 billion for the wealthy Greeks. What collateral will an economy with 20b in GDP post to get this cash? Unless Mario violates every collateral rule at the ECB, the Cypriot financial system will collapse even with a YES vote. Its a wonderful life - Cyprus style.

Dennis Gartman recently detailed why the tiny island nation is so appealing to the Russians... Cyprus has been their own private Switzerland for many years. Legal and non-legal Russian cash has swamped the banking system in Cyprus since the early 90’s. The beauty of the island; the ease of admission too and exit from the island via boat or plane; the secrecy of the banking laws; the warm Mediterranean climate and the ease of which Cypriot authorities could be bribed and bought all worked to make Cyprus the center of Russian capital flight. Will The Banking Meltdown In Cyprus Be A “Lehman Brothers Moment” For All Of Europe?  - 

Not a single Cypriot politician voted in favour of a draft bill which would have seized part of people's bank deposits in order to qualify for a vital international bail-out. The rejection leaves Cyprus's bail-out in question and Nicosia will have to come up with an alternative plan to raise the money needed. Speaker of the House, Yiannakis Omirou said the rejection of the bill served to protect "all the people of the member countries of the European Union". He also confirmed political leaders would have a meeting with the president on Wednesday to discuss the next steps. Hundreds of protesters outside Parliament cheered and sang the national anthem when they heard the bill had not been passed. Cyprus bail-out: bank levy rejection 'protects all Europeans' 

Date : 3/21/2013

It is worth remembering that a run on banks in Cyprus could wipe out the savings of 60,000 Britons, including at least 12,000 pensioners, if the financial sector collapses. Cyprus: capital controls imposed to prevent crisis spreading to the rest of eurozone 

Worse still for the European powers, speculation is rife that Moscow is seeking the right to use The Cypriot port of Limassol as a naval base. Currently, Russia relies on a base at Tartus in Syria to access the Mediterranean. However, the current Syrian regime of President Bashar al-Assad is the target of a US-led war for regime change also directed against Russia and China. Europe in crisis as Cyprus faces national bankruptcy 

 If the largest banks in Cyprus are allowed to fail, it will be another "Lehman Brothers moment".  The faith that people have in banks all over Europe will be called into question, and everyone will be wondering what major European banks will be allowed to fail next.

In fact,Bloomberg is reporting that EU officials are actually thinking about shutting down the two biggest banks in Cyprus and freezing their assets...Finance ministers for the 17 euro countries are considering a plan to shutter the two biggest banks in Cyprus and freeze the assets of uninsured depositors, said the four officials, who asked not to be named because the talks are ongoing. The ministers are holding a teleconference tonight. Cyprus Popular Bank Pcl (CPB) and the Bank of Cyprus Plc would be split to create a so-called bad bank, one of the officials said. Insured deposits -- below the European Union ceiling of 100,000 euros ($129,000) -- would go into a so-called good bank and not sustain any losses, while uninsured deposits would go into the bad bank and be frozen until assets could be sold, said the four officials. Losses to unsecured creditors, including uninsured depositors, could reach 40 percent under the plan, which has support from the International Monetary Fund and the European Central Bank. The proposal, a version of which was rejected last week, is considered a better option than taxing insured deposits or allowing Cypriot banks to collapse in a disorderly fashion if they lose access to ECB aid, the officials said.

European officials are even publicly talking about the possibility that Cyprus will soon need to start using "their own currency"...In Brussels, a senior European Union official told Reuters that an ECB withdrawal would mean Cyprus's biggest banks being wound up, wiping out the large deposits it has sought to protect, and probably forcing the country to abandon the euro."If the financial sector collapses, then they simply have to face a very significant devaluation and faced with that situation, they would have no other way but to start having their own currency," the EU official said.

Politicians in Cyprus are frantically searching for a way to raise the needed cash without raiding private bank accounts.  The following is what CNN is saying about the latest efforts... Leaders of Cyprus' political parties agreed Thursday to create an "investment solidarity fund," which would issue bonds backed by state and church assets. The plan was due to be discussed by the Cypriot government and parliament on Thursday evening, but few details were available and it was not clear how much the fund would be worth.

According to Reuters, other proposals have been under consideration as well... The government said a "Plan B" was in the works. Officials said it could include: an option to nationalize pension funds of semi-government corporations, which hold between 2 billion and 3 billion euros; issuing an emergency bond linked to future natural gas revenues; and possibly reviving the levy on bank deposits, though at a lower level than originally planned and maybe excluding savers with less than 100,000 euros.

German Finance Minister Wolfgang Schaeuble is saying about the situation in Cyprus... German finance minister Wolfgang Schaeuble told the ZDF public broadcaster on Tuesday night (19 March) he "took note with regret" of the Cypriot parliament's rejection of the bailout deal, but insisted that the terms will stay the same. 

Asked if the eurozone was willing to let Cyprus go bust, he answered: "Well, we are much more stable in the eurozone - we took measures to protect ourselves from the risks of contagion ... but I don't want to have any of this." 

He added: "It is a serious situation, but this cannot lead to a decision that makes absolutely no sense, to rescue a business model that has failed. Cyprus has a banking sector that is totally oversized and this made Cyprus insolvent. And nobody outside Cyprus is to blame for it." Schaeuble knows that the EU is holding all of the cards and that Cyprus is doomed without their help...

"The Cypriot state cannot fund itself on the markets. Its two largest banks are insolvent and are being kept afloat with emergency funding from the ECB, but only on the condition that there will be a long-term rescue programme. If this condition is no longer met, Cyprus will no longer be solvent and this is something Cypriot decision makers must know" Mass Panic In Cyprus: The Banks Are Collapsing And ATMs Are Running Out Of Money

Proposals to reach a Plan B will do nothing to change the fundamental character of the bailout, which demands a massive attack on the living standards of the working class. Coming after a large anti-EU vote in the Italian elections, on-going strikes and protests in Portugal, Greece and Spain, and the toppling of the Bulgarian government last month, ruling circles are well aware that class relations in Europe are at the breaking point. Europe in crisis as Cyprus faces national bankruptcy

Date : 3/22/2013

A Cypriot plan for a new state investment fund to recapitalise banks will be backed by nationalised pension funds, church property and, as yet untapped, oil and gas reserves. Cyprus overhauls two biggest banks to stave off collapse 

With the crippling uncertainty over the future of Cyprus' banks, islanders' deposits and the nation's membership of the euro continuing, Jeremy Warner assesses the latest plan to rescue the country's stricken economy. Cyprus bail-out: Plan B is 'hopeless', says Jeremy Warner - 3/22/2013

3/23/2013

The Troika—the EU, ECB and the International Monetary Fund—

are determined to put Cyprus on rations, demanding savage cuts. On Thursday, reports had already begun to emerge of the crippling impact of the shutdown of the country’s financial sector. Medication was beginning to run out in hospitals, and many businesses were demanding payment in cash for fear that credit cards would never be charged, should the banks fail to re-open. Cyprus to face savage cuts and economic dictatorship

The Cypriot government has described the negotiations with the eurozone and IMF over the fate of Cyprus as “hard ... bearing in mind the social misery that a possible rejection of the proposal would cause”. A spokesman for President Nicos Anastasiades said: “We will be called upon to take the big decisions and reply to the hard dilemmas. The next few hours will determine the future of this country. We must all assume our responsibility. Any solution involves pain. Cyprus savers face draconian measures in bid to avoid nation's exit from eurozone 

3/24/2013

“People are worried not just because they could lose their savings but because they could lose their jobs too,” said Ioanna Constantinou, 24, who works in the financial services industry in Nicosia, the Cypriot capital. “I think a lot of people will be out of work soon and looking for jobs. The young people, especially, will go abroad because you can’t live with this level of uncertainty,” said Miss Constantinou, who like many Cypriots attended a British university. “The banking sector is finished, we have lost all credibility – who is going to want to bring their money to Cyprus now?”

“We are the guinea pigs – they are testing the “bail-in” model here before applying it to other countries. They are punishing us and making sure the rest of Europe sees. It’s a public whipping. The only question is, who’s next?” said Mr Angelides.

“The talk among a lot of locals is that Germany has engineered this deliberately to scare off the Russians and so that they can get their hands on the LNG deposits. That way we will be forced to turn to Germany as our next sugar daddy. We have been forced to slap the Russians in the face, even though we didn’t want to,” said John Leonidou, a reporter with the Cyprus Weekly, who was brought up in the UK. “We have always been important strategically, from the time of the Venetians, the Ottomans and the British. We are slap bang in the middle of Africa, Asia Minor and Europe. The gas reserves makes us even more important. But as a commercial centre, we have been destroyed. We will have to pull off a miracle to bring back our credibility.” Cyprus facing ruin regardless of deal, islanders warn - 

Olli Rehn, the European Economic and Monetary Affairs Commissioner, said it was essential that eurozone finance ministers reached an agreement on a rescue deal on Sunday. “There are only hard choices left,” he said. Wolfgang Schaeuble, German finance minister, noted that financial markets were calm and the euro stable despite the Cyprus crisis, in a veiled warning that the eurozone may force the island's exit from the single currency. "Framework for the assistance programme will not change and the European Central Bank cannot guarantee its relief assistance until after Monday. Cyprus has a hard road to go either way," he told German newspaper Die Welt this morning. The 20 per cent rate on high-value accounts at the Bank of Cyprus is likely to trigger political conflict on the island, which has seen widespread protests in the last week. It is expected to particularly hit Russian investors, who make up the bulk of the Cypriot financial sector's high-value clients.  Eurozone offers Cyprus the exit - our way or the highway  

3/25/2013

Bernanke Fails to Answer Concerns about a Cyprus-Style Seizure of American Bank Deposits HERE

Posted on March 21, 2013 by WashingtonsBlog

Bernanke Entirely Fails to Answer Question

The government of Cyprus wants to grab bank deposits, and the chief economist of the German Commerzbank has called for private savings accounts in Italy to be similarly plundered, and other nations may be movingin that direction as well. The American government has seized private assets before, and President Obama authorized seizure of property again last year. (The Argentinian government grabbed 401k assets; and some in the American government have mulled the same thing. And the  U.S. government’s take-down of Megaupload was also an exercise of the power to seizeall of the legal property held in a storage facility because a handful ofcrooks have illegal property in theirs.  ) Zero Hedge has been warningfor years that Western governments – including the U.S. – would eventually seize bank assets. Bernanke was asked yesterday whether a Cyprus-style grab of bank deposits is possible in the U.S. : 

Question: I was wondering if you can tell me how if a run on the banks happens in Cyprus, how that might affect U.S. markets. And also is it possible for the U.S. to levy a tax on regular deposits here? Or why not? 

Bernanke: As someone mentioned Cyprus is a tiny economy. I don’t think these issues as worrisome as they are and as concerned as we would be for the Cyprus people, I don’t think that they have a direct implications for the U.S. economy. The only way that they would create a problem would be if the runs became contagious in some sense, if depositors in other countries lost confidence. But to this point I’m not aware of any evidence that that is in fact the case. The argument the Europeans are making is that Cyprus is a unique situation, very different situation, and indeed, it is quite unusual to have a banking sector as large as they have relative to their economy. In terms of the United States, the FDIC was founded in 1934, and we have insured deposits and they are very proud of the fact that no one has ever lost a dime in insured deposits. And during the crisis the response of the government was in fact to increase the level of deposit or account sizes that were insured. So I consider that to be extremely unlikely in the United States.

Bernanke’s response is unsatisfactory for 2 reasons. 

Initially, the FDIC only insures deposits up to $250,000. So deposits over that amount are unprotected.

Indeed, the FDIC has, in fact, come very close to being insolvent at various times.  See the following articles from the New York Times, American Banker, Bloomberg, Zero Hedge and Mish. 

True, the Treasury Department would likely just bail out the FDIC if the FDIC really went belly up. But that would take a political act of will. 

And so Bernanke should have said, “we will always make sure the FDIC has enough money”. 

Second – and more important -  Bernanke failed to answer the question altogether.   The question was not about whether the government would save bank depositors from economic conditions caused by others.  The question was whether the government itself would grab deposits.

People didn’t think any European country would seize bank deposit assets.  But the EU demanded that the government of Cyprus seize private bank deposits.  The attempt of a government to seize  private property is undermining confidence in Europe … and many people worry that that contagion will spread.  That is what the question was about. Bernanke entirely failed to answer the question which was actually asked … and has thereby caused a tsunami of distrust on the Internet. In the same way that the Department of Justice’s wishy-washy assurances that it probably wouldn’t assassinate Americans on U.S. soil hasn’t reassured anyone, Bernanke shouldn’t have given a half-hearted reply.  

He should have said:

The U.S. will never, ever seize any American’s bank deposits under any scenario whatsoever … without exception. We respect the rule of law as the basis for our economy, and we will never do anything which interferes with private property rights.Bernanke’s failure to reassure couldn’t have come at a worse time. 

British MP Nigel Farage just gave the following advice in response to the Cyprus bank deposit grab:

Get your money out while you still can. The failure of American economic “leaders” to provide real reassurance regarding our bank deposits will just increase mistrust. Indeed, more and more Americans realize that the government has bailed out the super-eliteof the big banks,  and enabled their fraud … while  hosing the little guy again and again (and again). People see that we have socialism for the rich, butcut-throat, sink-or-swim capitalism for everyone else.   They see that we have a malignant synergism between D.C. politicians and giant companies. Look here, here, here. Indeed, after Wall Street giants such as MF Global and JP Morgan got caught seizing segregated client funds – but were never prosecuted by the government – both amateur and sophisticated investors have lost trust in the American financial system and financial regulators. 

(It has become obvious to all that the government is trying to cover up for the stunning crimes of the big banks.)

This entry was posted in Business / Economics, Politics / World News. Bookmark the permalink.

In a televised address Monday evening, President Nicos Anastasiades claimed that the deal had averted “the collapse and the bankruptcy of the state,” enabling the country to return to “normalcy,”“The danger for the bankruptcy of Cyprus is definitely left behind and the tragic consequences for the economy and the society are averted,” he said.In fact, the restructuring plan is tied in with the loss of thousands of jobs in the banking sector, privatisations, and severe austerity on a par with measures that have devastated Greece.

As the BBC’s Robert Peston commented, “The rescue of Cyprus won't feel like one to its people.” It amounted, he continued, to “An economy that will be starved of credit, and will therefore shrink rapidly and very painfully for citizens,” and whose “main industry, offshore banking, is being shut.” 

The Fitch rating agency has put Cyprus on “watch negative,” stating that “the shock resulting from the systemic failure of Cyprus's banking system will have profound negative implications for the domestic economy, which heightens the risk to public finances.”

3/25/2013 

Cyprus bank bailout agreement is pure theft: 40% of private deposits to be looted from selected accounts - 

 3/26/2013

Two geo-strategic issues are at stake in this conflict. 

As yet unverified supplies of gas off the coast of Cyprus are only likely to be extracted by 2018-19 at the earliest. But conflict over access to them is a major consideration. The bailout of Cyprus by the troika will be used as a mechanism to strengthen the control of European and US firms over these resources, and potentially create an alternative supply of gas for the European market to that controlled by Russia. 

This strategy is not only dangerous because of the conflicts it will provoke with Moscow, but because the gas deposits are in disputed waters also claimed by Turkey. Ankara has threatened that any exploitation of energy reserves in “Turkish” waters would be deemed an act of war. 

Secondly, there is a political imperative to deny Russia access to the Cypriot port of Limassol as a naval base. With Russia presently reliant upon a base at Tartus in Syria to access the Mediterranean, US-led moves to depose the regime of President Bashar al-Assad and then target Iran in order to establish undisputed hegemony over the Middle East’s oil riches require the exclusion of any counter-offensive by Moscow. European Union imposes bank bailout on Cyprus - 3/26/2013

 3/27/2013

Thousands of workers and youth took to the streets of Cyprus Tuesday to protest terms imposed by European authorities in exchange for a €10 billion ($12.9 billion) loan to avert state bankruptcy. The Mediterranean island remained under financial lock-down, and its working population face the prospect of economic collapse and penury. 

Bank staff fearing mass layoffs demonstrated outside the central bank headquarters in the capital Nicosia, while high school and university students walked out of classes and gathered in front of the presidential palace. Their slogans were “Troika go home,” and “those who stole our money should go to jail and pay.”  Cyprus faces deep recession, high unemployment after bank bailout - 3/27/2013

How it feels to lose 40% of your savings.

“It is theft when the government has access to your bank account and takes whatever amount they want. That’s money that we earned, that we saved, that we worked hard for.” How It Feels To Have Your Life Savings Stolen In Cyprus

3/28/2013 

Cyprus: atmosphere 'tense' as banks open - 3/28/2013

3/29/2013 

The bailout imposed on Cyprus by the European Union (EU) is a politically criminal act of financial looting, aimed at destroying the country’s banks and reducing the working class to penury.

In the name of avoiding state bankruptcy, the small Mediterranean island of some one million people is being subjected to the type of shock-therapy already inflicted on Greece.

The European Union’s looting of Cyprus - 3/29/2013

Published: May 10

Cyprus considered exiting the euro zone in March

By Howard Schneider

Cyprus seriously considered dropping out of the euro zone at the peak of its financial crisis in March as it faced a standoff over the terms of an international bailout, Cyprus Foreign Minister Ioannis Kasoulides said in an interview in Washington on Thursday.

The country’s leaders discussed severing ties with the 17-nation currency union for “24 to 48 hours,” after the parliament rejected an initial bailout plan, throwing the country’s economic future into doubt, Kasoulides said. “It was an internal reflection” about how the country should proceed, he said. “We had to think of all the plans B or C that existed.”

The exit idea was shelved after it was estimated that reinstating the Cypriot pound would have caused an immediate 40 percent drop in the value of the new currency, devastating a small island that relies heavily on imports.

Kasoulides’s comments give insight into just how perilous the past three years have been for the euro zone but also into some of the currency union’s underappreciated strengths.

That government leaders would include an exit as an option undermines broad claims that the monetary union is “irreversible” and that the euro is destined to remain and grow as a world reserve currency. Indeed, Kasoulides said Cypriot leaders were aware of the broader implications of their actions.

“Once we were out, many governments — in Greece and Portugal — it would have been very, very difficult to convince their public opinion that they should stay” and follow the tough economic plans laid out by other European countries and the International Monetary Fund, he said.

But it wasn’t just concern about the effect on imports that led Cyprus to recommit to the euro. Kasoulides said officials were hesitant to undermine what has been at the center of efforts to knit Europe into a tighter political and economic community. “We did not do it for altruistic reasons. But we had to take into account the political factors, as well,” he said.

Amid three years of speculation about a possible euro-zone rupture, some analysts have pointed to just such political considerations as one reason the currency zone was likely to hang together.

Cyprus posed a unique challenge as the IMF and other European nations discussed and ultimately approved a rescue loan. With its major banks failing, the country faced an unusual international demand that losses be imposed on depositors and that institutions without a credible path back to profitability be allowed to fail. The IMF and others said depositor losses were the only way to make a rescue plan work, because the country did not have the resources to guarantee all deposits, and neither the fund nor neighboring countries were willing to lend enough to make that guarantee.

Kasoulides said that responsibility for the crisis “lies with Cyprus itself” but that he thought the country was also used to set an example. None of the institutions at risk in Cyprus was large enough to be a threat to the regional or global system, he noted, making it the perfect place to draw a line on taxpayer bailouts of the banking system.

“An experiment was needed,” he said. “We will recover in the coming years. . . . But I think . . . they should make sure that Cyprus is assisted so that this experiment succeeds.”

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