Green Room

Cyprus president: We’re not going to leave the Euro

posted at 12:00 pm on March 29, 2013 by

Don’t take that to mean that Nicos Anastasiades is just thrilled with Eurozone leadership. He gave a short but bitter address today, trying to reassure Cypriots that the banking system had been saved, but lashed out at its purported saviors:




In a speech laden with criticism of Europe’s currency union for experimenting with the island’s fate, Conservative leader Nicos Anastasiades spoke a day after banks reopened following an almost two-week shutdown to avert a run on deposits by worried Cypriots and wealthy foreign depositors.

Anastasiades said restrictions imposed on bank transactions in Cyprus – unprecedented in the currency bloc since euro coins and banknotes entered circulation in 2002 – would be gradually lifted. But he gave no timeframe. …

In a speech to civil servants in the capital, Nicosia, Anastasiades hit out at banking authorities in Cyprus and Europe for pouring money into a crippled Cypriot bank that now faces closure under the terms of the €10bn (£8.4bn) bailout plan that averted the immediate risk of financial meltdown.

“How serious were those authorities that permitted the financing of a bankrupt bank to the highest possible amount?” Anastasiades said.

“I don’t want to say more,” he added. “Now is not the time to say who bears more or less of the blame.”

Anastasiades clinched the last-ditch bailout in Brussels five days ago, but has faced a backlash from Cypriots angry at the price that came with it – the winding down of the island’s second-largest bank, Cyprus Popular Bank or Laiki, and an unprecedented raid on deposits over €100,000 that could spell the end of Cyprus as a hub for offshore finance. The country faces steep job losses and a prolonged and deep recession.

The president, barely a month in the job and wrestling with Cyprus’s worst crisis since a 1974 war split the island in two, accused the 17-nation euro currency bloc of making “unprecedented demands that forced Cyprus to become an experiment”. But he added: “We have no intention of leaving the euro. In no way will we experiment with the future of our country.”

Well, not any more, at least.

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We’re not going to leave the Euro…….

…..and give up that money laundering business we run for the Russkies.

BobMbx on March 29, 2013 at 12:51 PM

I truly do not understand the massive loyalty shown the EU — the first country to leave the Euro (and tear up its EU debt) may well be better off than the others.

Just think of the possibilities. You’re Cyprus. You publicly renounce the Euro, switch to a Cypriot currency and default on all the Euro debt. You then re-establish yourself as a non-Euro tax haven, deregulate your economy, and try to become the Cayman islands of Europe and Russia.

Sure, the Euro countries might be pissed off, but what are they going to do? Invade you?

There will be pain in the beginning, but over time, you can increasingly stick your finger in the eye of the other Euro countries, by undermining EU regulation and attracting expats, businesses fleeing high-tax environments, tourism, etc. Your ability to make your own laws constitutes a competitive advantage vis a vis everyone else.

Revenant on March 29, 2013 at 12:51 PM

What is an voluntary slave called?

Oil Can on March 29, 2013 at 1:19 PM

I truly do not understand the massive loyalty shown the EU — the first country to leave the Euro (and tear up its EU debt) may well be better off than the others.

Revenant on March 29, 2013 at 12:51 PM

These guys are all socialists who went to the same kinds of schools and learned the same things and have been trained to venerate the EU as some sort of holy wave of the future. They will NEVER give it up until the entire Eurozone implodes. It’s the same problem with US socialists – most are a bunch of fanatics who cannot concieve of why their schemes don’t work.

Doomberg on March 29, 2013 at 1:48 PM

These guys are all socialists who went to the same kinds of schools and learned the same things and have been trained to venerate the EU as some sort of holy wave of the future. They will NEVER give it up until the entire Eurozone implodes. It’s the same problem with US socialists – most are a bunch of fanatics who cannot concieve of why their schemes don’t work.

Doomberg on March 29, 2013 at 1:48 PM

One would think that they’re love of their own country would take precedent over the amorphous EU, especially in a situation like this. I can’t see how the EU survives this level of contagion — the problems from 2008 have been pushed off, not fixed.

Revenant on March 29, 2013 at 2:20 PM

Thhis morning I woke up next to a horse head that was not my wife and after thorough consideration I decided that we wont leave the Euro!

Valkyriepundit on March 29, 2013 at 3:01 PM

DARN!

LincolntheHun on March 29, 2013 at 3:04 PM

When it becomes serious, you have to lie.

-Jean Claude Juncker

Weight of Glory on March 29, 2013 at 3:19 PM

You couldn’t leave the Euro if you wanted to, dipshit. The only way you’re going to avoid a run on your banks now is to convince the plebes that you don’t want to. Good luck with that.

gryphon202 on March 29, 2013 at 3:36 PM

What is an voluntary slave called?

Oil Can on March 29, 2013 at 1:19 PM

A democrat?..mainstream media?..college kids?

Mimzey on March 29, 2013 at 3:57 PM

What is an voluntary slave called?

Oil Can on March 29, 2013 at 1:19 PM

Indentured servant was the term, IIRC from my history classes.

MelonCollie on March 29, 2013 at 4:05 PM

In no way will we experiment with the future of our country.

Yeah, I guess you should stick with the failed experiment you already have. Might as well go down with the ship.

RadClown on March 29, 2013 at 6:50 PM

Yeah, but in the prequel they said, “We’re not going to steal 40% of the money in banks.”

wte9 on March 29, 2013 at 9:14 PM

So the EU should just be envisioned wearing a dirty white tank top and Cyprus, sporting a new black eye, is just saying, “But you don’t understand.. I love him!”

Nethicus on March 29, 2013 at 9:16 PM

Some folks say that a lot of the large accounts in these banks in Cypress belong to the Russian Mafia (mob), if that is true and they take 40% of their money, they (the Russian Mafia) might get a little pissed. There might be a few EU bankers, EU Politicians and some of their family members (and not just in Cypress) that end up on slabs in morgues that may be difficult to positively identify without DNA tests. Huh, at any rate, good luck with that.

Wallythedog on March 29, 2013 at 11:45 PM

Some folks say that a lot of the large accounts in these banks in Cypress belong to the Russian Mafia (mob), if that is true and they take 40% of their money, they (the Russian Mafia) might get a little pissed. There might be a few EU bankers, EU Politicians and some of their family members (and not just in Cypress) that end up on slabs in morgues that may be difficult to positively identify without DNA tests. Huh, at any rate, good luck with that.

Wallythedog on March 29, 2013 at 11:45 PM

Supposedly a good amount of the Russian money was able to escape the capital controls. Apparently, there were exceptions to the electronic transaction ban, such as for “humanitarian aid,” etc. From what I understand, much of the Russian deposits were able to flee while the banks were closed.

That’s one of the reasons why the haircut taken by uninsured depositors rose so high (remember, it was initially to be about 10%). Now some uninsured depositors will end up taking an effective 80-100% haircut.

Revenant on March 30, 2013 at 8:47 AM

Now some uninsured depositors will end up taking an effective 80-100% haircut.

Revenant on March 30, 2013 at 8:47 AM

IT’s just a wealth tax. Not all that different in theory than what we do to earned income here in the states.

gryphon202 on March 30, 2013 at 11:08 AM

Ouch!

a capella on March 30, 2013 at 2:34 PM

IT’s just a wealth tax. Not all that different in theory than what we do to earned income here in the states.

gryphon202 on March 30, 2013 at 11:08 AM

Its a big difference in that, theoretically, the money has already been taxed once.

Suppose you earned ordinary income and paid taxes on it, and deposited your after-tax money in a bank account. The government doesn’t come back and tax the after-tax money you placed in your bank account again as income.

My guess is that most Cypriot depositors likely paid income taxes on the money when it was earned also. Now its just being confiscated.

The haircut does make some sense from a workout perspective: a bank deposit really is an unsecured loan to the bank. If the bank goes under, secured creditors generally take priority to unsecured creditors. One would expect unsecured depositors to take some kind of a hit. But then, the bank should end up going bankrupt.

Revenant on March 30, 2013 at 2:38 PM

Progressive confiscation?

DFCtomm on March 30, 2013 at 5:37 PM

This one is funny too.

DFCtomm on March 30, 2013 at 5:40 PM

Sorry for all the posts, but they just keep coming. No bank runs in the EU, no sir. Nothing to see here move along folks.

DFCtomm on March 30, 2013 at 5:43 PM

Yeah, but in the prequel they said, “We’re not going to steal 40% of the money in banks.”

wte9 on March 29, 2013 at 9:14 PM

According to an article I read yesterday they took over 60%.

dogsoldier on April 1, 2013 at 5:45 AM

http://finance.yahoo.com/news/big-depositors-cyprus-lose-far-012924065.html

But the official decree published on Saturday confirmed a Reuters report a day earlier that the bank would give depositors shares worth just 37.5 percent of savings over 100,000 euros. The rest of such holdings might never be paid back.

dogsoldier on April 1, 2013 at 5:47 AM