Cyprus

Cypriot Legislators Are Rushing to Put Together a Bailout Plan

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Credit: Leonid Mamchenkov/wikicommons

The Cypriot government has rejected the European Union's bailout deal and has failed to secure aid from the Russians.

A brief announcement from the European Central Bank issued yesterday said that it would stop providing emergency funds for the Central Bank of Cyprus on March 25 unless the Cypriot government can reach a bailout deal with the E.U. and the International Monetary Fund.

The Cypriot government rejected the E.U.'s bailout deal in part because it required that those with deposits in Cypriot banks contribute to a bank levy. This understandably made those with Cypriot accounts concerned and some feared a run on the banks. The move upset Russian Prime Minister Dmitri Medvedev, who said that the move would be akin to something seen under the Bolsheviks. Today the Cypriot government is discussing plans that include guaranteeing deposits of €100,000 in accounts with Laiki, one of the largest banks in Cyprus. Those with more than of €100,000 in an account with Laiki could potentially see some of their money seized. From the Associated Press:

As part of the package being discussed Friday, lawmakers were considering restructuring the country's second largest bank, Laiki, which suffered big losses on investments in Greek debt.

A large part of deposits in Laiki above the €100,000 ($129,000) per depositor that are insured could be confiscated. A banking official, who spoke only on condition of anonymity because the talks were ongoing, said seizures of 25% to 30% were being discussed.

What is remarkable about the situation in Cyprus is that under the plan originally put forward by the E.U. and the plan being discussed by the Cypriot government those with savings in Cypriot banks could see some of their money seized. If a plan is agreed upon that allows for money to be seized directly from accounts it will be a worrying precedent to set, despite the fact that taking money directly from depositors accounts is just a more direct way of taking money than inflation.

Member of the European Parliament Daniel Hannan has pointed out that it might be worth remembering another small island that ran into financial problems a few years ago.

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  1. Well, at least when Medvedev calls something a communist plot, nobody sneers and says he doesn’t know what the fuck he’s talking about.

    1. “And I know from Communist plots!”

  2. That is one weak-ass flag. I like the simplicity of the Texas flag, but you really can’t top the Virginia flag. I mean, c’mon, an actual slaughtered tyrant, and a promise to do the same to the next one? That’s just badass.

    1. I just googled Virginia’s flag. It really is badass.

      1. I just googled Virginia’s flag. It really is badass.

        I’ve always said it needs an update. Change the spear and sword to an M1A and a 1911.

      2. You’d think the pro-Lincoln folks would be up in arms about the slogan.

    2. Has an exposed titty as well.

      1. Or is that a dude holding a giant dildo? Shit, I take it back. I take it all back.

        1. I think that’s a bong.

          1. You only get to say that when they legalize weed in Virginia.

            1. You only get to say that when they legalize weed in Virginia.

              Once the other 49 have done it, maybe.

    3. Is that what it is? I thought it was a screen cap from a Michael Landon TV-movie.

    4. Maryland’s flag gives me a headache.

      1. Maryland’s flag is the bomb!

        1. Ohio’s looks like it should be on a ship. aslo, did Texas steal their flag from Chile, or vice-versa?

    5. i rotate. USA, VA, and Gadsden off of my deck.

      1. i rotate. USA, VA, and Gadsden off of my deck.

        Betsy Ross, Continental (Pine Tree canton with red field), Grand Union, Gadsden and 15-star 15-stripe (circa 1800) USA.

        I have a few others, but they don’t get out as often.

        1. We go Gadsden all the time now. I used to rotate between Virginia, Gadsden and the Whiskey Rebellion flag before I met Banjos.

      2. If I flew a flag, it would probably be the Jolly Roger.

    6. Virginia is for tyrant-slayers.

    7. The cyrprus one looks like an olive branch in a puddle of pee.

    8. Yeah, it is pretty awesome. When I start the active resistance, “Sic Semper Tyrannis” will be the “Wolverines!” of my guerilla band. Because Fuck Michigan!

      1. if you don’t have one already, $6 on amazon. free shipping

        1. I don’t have a place to fly it. If I ever manage to buy a house, I’d rotate it with some of my other flags.

    9. California’s flag can devour your state’s flag.

  3. Is it a rule at Temple that the coach has to actually look like an owl?

  4. it will be a worrying precedent to set, despite the fact that taking money directly from depositors accounts is just a more direct way of taking money than inflation.

    It is precisely as direct a way of stealing as taxes, or highway robbery, but without the calming effect on the more gullible parts of the populace of having taxes debated and voted upon and given the sheen of perceived legitimacy of not being an ex post facto action.

    1. Exactly. This is no different than withholding wages, it’s just more obvious. Also, fuck Milton Friedman for that.

    2. The money is going to prop up the very same banks the depositers have their deposits in. Which are getting bailed out.

      I call that justice.

      Perhaps we can extend the concept and just not bail out the banks at all.

  5. A large part of deposits in Laiki above the ?100,000 ($129,000) per depositor that are insured could be confiscated. A banking official, who spoke only on condition of anonymity because the talks were ongoing, said seizures of 25% to 30% were being discussed.

    So they want to piss off the Russians even more?
    And I assume there’s more than a few Cypriots who’ve saved that much as well

    1. “So they want to piss off the Russians even more?”
      They figure the US will save their butts; no use giving up vacation days to fund any defense.

    2. Or maybe it is that the Russians don’t have much if any money in that bank and when the Cypriot PM was in Moscow earlier in the week Putin explained to him that he could whack as much as they wanted from that particular bank and not have ex KGB agents hunting them down.

  6. It was this sort of thing that made secret Swiss bank accounts so attractive in the first place.

    Swiss banking had already been around for a long time, but it got a huge shot in the arm during the French Revolution. When things started getting dicey, the French aristocracy realized it might behoove them to have some of their wealth stowed away across the border in a secret bank account in Switzerland, where a future revolutionary government wouldn’t have access to those accounts.

    We used to kid my grandmother a lot. After the Depression, she never really trusted the banks again–and certainly didn’t trust the government to make good on their promises.

    Anybody that’s leery of having the government know what guns you have (out of concern that they may come to confiscate them someday) should be ten times more leery of having the government know exactly how much money you have and where it is at all times.

  7. Seriously, why put the blotch from Gorbachev’s head on a flag?

  8. I’m sure it will all work out fine. As we all know, emergency legislation passed without debate in the wake of a national crisis is always well thought out and free of any pesky unintended consequences.

  9. Again, I fail to see the problem with letting depositers lose their money. The banks are getting bailed out and thus the depositors and bank shareholders. The people who are getting ripped off are the people financing the bailout. If you deposit your money in a shaky bank and the bank fails you lose money. That’s how it should be. the fact that they are gettig anything back at all if due to the (forced) generosity of taxpayers elsewhere.

  10. “the country’s second largest bank, Laiki, which suffered big losses on investments in Greek debt.”

    Were these losses the result of the EU-forced fleecing of Greek bond-holders?

  11. You know who else needs to rush and put together a bailout plan? Kansas State.

    They’re getting their ass kicked in. Could we see the oh-so-rare 12 v 13 second round matchup? That would be sweet.

  12. Guys, I think we should rush to finance a Reason bailout. Then they might be able to afford alt-text.

    1. We reached Peak Alt-Text several months ago. I think they’re cutting back a bit for environmental reasons. I blame Ron Bailey.

      1. There has been zero evidence that alt-text contributes to anthropomorphic global boring.

  13. If you think Edna`s story is cool…, last pay-cheque my sister’s best friend basically also recieved a check for $5865 working a seventeen hour week from there apartment and their best friend’s mom`s neighbour done this for 9-months and got over $5865 parttime from a labtop. follow the instructions on this address, http://www.wow92.com

    1. pay-cheque

      Die, you Limey scum.*

      *Or Canuckistani, Australian or Kiwi

  14. How to kill your banking sector in five easy steps:

    1. Invest in Greek debt and real estate bubble instruments.

    2. Go broke.

    3. Shut down the banks and threaten to take everyone’s money.

    4. Back off the plan to take everyone’s money when people riot in the streets and their legislature votes 56-0 against it.

    5. Decide to take only rich people’s money instead.

    6. Keep the banks closed the whole time, then tell people their checking accounts will now be CDs with early withdrawal penalties when the banks finally reopen.

    Yeah, that’ll work. Watch the foreign cash flow into Cypriot banks, now that confidence is restored.

  15. Lets hit it up realy good now dude.

    http://www.Anon-Today.tk

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