Cyprus surprise - Cypriot depositors to take a 'haircut'

socrates

BlondeHeadOn wrote: »

What I can't understand is that most Cypriots I've seen interviewed stil say they want to stay in the euro.

I will probably be shot down in flames for this, but I really can't see any advantage to them now in staying in?

At least if they had their own currency again they could devalue and set own interest rates etc., and boost tourism by having a cheap exchange rate etc.

I for one wouldn't fancy visiting Cyprus now if it stays in the
euro - it will remain expensive in euros, and lots of small businesses will have folded and the economy will be shot. And the local people will be well fed up.

Have they shot their other main industry - tourism - in the foot as well?

:cool:

Because they are still under threat from the Turks in the North of this divided island

Mistakenly they believe that if the Turks decide to move southwards if they are not cut in on future Gas Revenues and invade that part too - that Europe gives two monkeys and will protect them

The reality is that Britain stood aside back in 1974 and Europe will do exactly the same - they may even sanction the move on some pretext

exarmydreamer

http://www.washingtonpost.com/blogs/wonkblog/wp/2013/03/24/m

Move over Cyprus, the little countries are all starting to fall. Seem's that lying catches up with you, when you 'cook the books', to join the Euro brigade. Interesting reading though but not mentioned much in the news.

socrates

John_Pierpoint wrote: »

No capital controls though ?!

As the saying goes:
"Fool me once, shame on you
Fool me twice, shame on me".

Why should anyone have more than 100,000 Euro in Cyprus?

Because not everybody was prepared to launder the money

ILW

Mr_Mumble wrote: »

The Cypriot people did not. It was Cypriot banks that lent this money.

Note the losses on Greek government debt for the private sector (notably Bank of Cyprus and Laiki/Popular bank) were so high because of subordination to allow Eurozone taxpayers to be kept whole.

Have any of those responsible had anything to say?

Itismehonest

BlondeHeadOn wrote: »

What I can't understand is that most Cypriots I've seen interviewed stil say they want to stay in the euro.

I will probably be shot down in flames for this, but I really can't see any advantage to them now in staying in?

At least if they had their own currency again they could devalue and set own interest rates etc., and boost tourism by having a cheap exchange rate etc.

I for one wouldn't fancy visiting Cyprus now if it stays in the
euro - it will remain expensive in euros, and lots of small businesses will have folded and the economy will be shot. And the local people will be well fed up.

Have they shot their other main industry - tourism - in the foot as well?

:cool:

They want to stay because, until the present problems started, it was a case of 'We've never had it so good.'
The Euro has always been more of a political move than a monetary one. The 'poorer' countries all saw it is a way to get easy money & for a while that worked. They live in the hope that it will be the same again.

As far as tourism is concerned, while the places remain peaceful (I'm not sure how long that will last) people will still want to visit. Much of Greece & Cyprus' problems came about because tax collection was almost non-existent.
If you are holidaying & have ready cash then you will find that places like Greece & Cyprus are great for getting bargains. They want your money & will fight over it. You could probably get upgrades on everything you want & spend a fraction of the normal price. The average Brit will be welcomed as if they were millionaires, I'd guess.

socrates

ILW wrote: »

Have any of those responsible had anything to say?

They have said as much as the people who sold RBS and the other UK banks toxic mortgage packages from the US

BlondeHeadOn

socrates wrote: »

Because they are still under threat from the Turks in the North of this divided island

Mistakenly they believe that if the Turks decide to move southwards if they are not cut in on future Gas Revenues and invade that part too - that Europe gives two monkeys and will protect them

The reality is that Britain stood aside back in 1974 and Europe will do exactly the same - they may even sanction the move on some pretext

Ahhh ... thank you, that actually starts to make more sense of it to me. I had forgotten about the Turkish North, it's been a while since I last visted - and none of the commentaries I've seen of the recent crisis has mentioned the North.

Does this make the gas reserves a potentially poisoned chalice? In the sense that they could cause more problems than they solve....

Lordy, what a mess!

ILW

socrates wrote: »

They have said as much as the people who sold RBS and the other UK banks toxic mortgage packages from the US

I would tend to blame the "professionals" that bought them.

socrates

BlondeHeadOn wrote: »

Ahhh ... thank you, that actually starts to make more sense of it to me. I had forgotten about the Turkish North, it's been a while since I last visted - and none of the commentaries I've seen of the recent crisis has mentioned the North.

Does this make the gas reserves a potentially poisoned chalice? In the sense that they could cause more problems than they solve....

Lordy, what a mess!

Why do you think America (Obama) convinced Israel to apologise to Turkey the other day - Israel has secured some of the exploration plots from Cyprus....

socrates

ILW wrote: »

I would tend to blame the "professionals" that bought them.

You can blame who you want

Did either the sellers or the buyers face any punishment?

Have any of them had their accounts raided to get back the bonuses they earned off the back of these deals?