Cyprus Bank Account Grab Raises Widespread Fears

Eurocrats shocked that people don't like being robbed

The smallest eurozone bailout yet is producing one of the most drastic solutions, with a proposed tax on deposits in Cyprus raising fears of bank runs elsewhere in Europe.

The 10 billion euros ($13 billion) that eurozone governments and the International Monetary Fund would provide is a fraction of the 85 billion euros for Ireland and the more than 240 billion euros for Greece.

But the condition that another 5.8 billion euros essentially be seized from depositors is a first for the European debt crisis. That raises concerns that other countries might pinch savings in a future crisis — or that such fears trigger destabilizing bank runs.

Comments

[Sevo]

"But the condition that another 5.8 billion euros essentially be seized from depositors is a first for the European debt crisis. That raises concerns that other countries might pinch savings in a future crisis ? or that such fears trigger destabilizing bank runs."
As I understand it, the EU commissioners specifically required the tax on deposits. WIH were they thinking?
Do they really want to scare every depositor and cause runs on banks across the continent?
I mean it makes no interest buried in a coffee can in the back yard, but at least it doesn't *lose* 10% instantly.