Guest Post: The Deeper Meanings of Cyprus

Tyler Durden's picture

Submitted by Charles Hugh-Smith of OfTwoMinds blog,

The deposit-confiscation "bailout" of Cyprus reveals much about the Eurozone's fundamental neocolonial, neofeudal structure.

At long last, Europe's flimsy facades of State sovereignty, democracy and free-market capitalism have collapsed, and we see the real machinery laid bare: the Eurozone's political-financial Aristocracy will stripmine every nation's citizenry to preserve their power and protect the banks and bondholders from absorbing losses.

The deposit-confiscation "bailout" of Cyprus confirms the Eurozone's fundamental neocolonial, neofeudal structure and the region's political surrender to financialization.

The E.U., Neofeudalism and the Neocolonial-Financialization Model (May 24, 2012)

Let's list what Cyprus reveals about the true state of financial-political power in Europe:

1. The Core-Periphery terminology masks the real structure: the E.U. operates on a neocolonial model. In the old Colonialism 1.0 model, the colonizing power conquered or co-opted the Power Elites of the periphery regions, and proceeded to exploit the new colonies' resources and labor to enrich the Imperial core.

In Neocolonialism, the forces of financialization (debt and leverage controlled by State-enforced banking cartels) are used to indenture the local Elites and populace to the financial core: the peripheral "colonials" borrow money to buy the finished goods manufactured in the core economies, enriching the Imperial Elites with A) the profits made selling goods to the debtors B) interest on credit extended to the peripheral colonies to buy the core economies' goods and "live large", and C) the transactional skim of financializing peripheral assets such as real estate and State debt.

In essence, the core banks of the E.U. colonized the peripheral nations via the financializing euro, which enabled a massive expansion of debt and consumption in the periphery. The banks and exporters of the core exacted enormous profits from this expansion of debt and consumption.

Now that the financialization scheme of the euro has run its course, the periphery's neocolonial standing is starkly revealed: the assets and income of the periphery are flowing to the core as interest on the private and sovereign debts that are owed to the core's central bank and its crony money-center private banks.

This is not just the perfection of neocolonialism but of neofeudalism as well. The peripheral nations of the E.U. are effectively neocolonial debtors of the core (quasi-Imperial) banks, and the taxpayers of the core nations (now reduced to Germany and The Netherlands) are now feudal serfs whose labor is devoted to making good on any bank loans to the periphery that go bad.

Though we can term the E.U. a plutocracy or oligarchy, the neofeudal structure compels us to distinguish a class of those holding wealth and political power that is not limited to national border: this is an Aristocracy.

Serving the Aristocracy is a well-paid technocrat class of factotums, lackeys, toadies and enforcers. Below this well-compensated caste of technocrats is the larger class of debt-serfs, enslaved to interest payments on either their own debts or the debts of others, and bound by their class powerlessness to protecting banks and bondholders from losses.

Cyprus merely adds an expropriation twist to this well-oiled plunder: deposits will be expropriated directly to insure no Imperial (core) banks or bond holders lose money on their absurdly risky loans to periphery nations and serfs.

2. This is a supranational plunder. While commentators can wile away years debating how much Germany benefited from the euro, the real core is not national, it is supranational banks and the political machinery of the E.U. the banks have effectively captured.

The citizenry of Germany may approve or disapprove of the Cyprus expropriation, but it doesn't matter either way: their own serfdom to banks and bondholders is simply being masked: the bailouts of periphery nations are transparently bailouts of core banks and bondholders.

The nation-states of the neocolonial periphery are simply convenient propaganda placeholders, useful misdirections aimed at the naive and sentimental, hollowed-out national structures propped up to mask the ugly neocolonial reality of servitude and plunder.

3. Democracy is a fiction when no matter who you vote for, the banks and bondholders win control of the national income stream and private wealth. Democracy in Europe is a travesty of a mockery of a sham, an absurd play which is acted out as a form of blood-sport circus to distract the masses from their powerlessness and debt-serfdom.

Democracy is a fiction when the policies protecting banks and bondholders from losses remain in place regardless of which political party, coalition or politico is nominally in power.

The German taxpayers' private wealth is being expropriated via taxes to bail out core banks and bondholders; how is this any different from the blatant expropriation of private assets in Cyprus?

It is only a difference in technique; the result is the same: the forced transfer of wealth from those who earned it from their labor to banks and bondholders which in a truly capitalist economy would be immediately forced to absorb the losses of their leveraged, highly risky bets.

4. The ideological fiction of capitalism is dead in Europe. Capitalism is a fiction if capital that is placed at risk for a return cannot be lost.

5. Cyprus is a test to see how blatant the expropriation of private assets can become without triggering overthrow and revolution. If the furor dies down soon enough, then the same technique of expropriation will be imposed elsewhere. If the reaction is sustained and threatening to the Aristocracy, other less blatant expropriations will be tested in other neocolonies.

6. Divide and conquer is the propaganda order of the day. The Power Elites are attempting to set the serfs of the periphery against the serfs of the core, the goal being to keep both sets of serfs from realizing they are equally indentured to the core's pathological political-financial Aristocracy.

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A Lunatic's picture

Unarmed = Serf. Same as it ever was, bitchez.............

Irelevant's picture

I have only one question, why didn`t they announce it post factum? There, we took 10%, now go fuck yourself. Why did they want to create panic? Have banks closed for 3 days? All the circus on the MSM?

Is the COMEX defaulting this week?! Because this Cyprus staged circus, with the president telling us how insolvent and broke the banks in CY were, and how this 10% levy was going to rescue the other $100 billion spent on Greek bonds is a huge false flag me thinks.

The Juggernaut's picture

7.  This is and will be a bank run.  Plan and simple.

pods's picture

Sometime on Wednesday, right after they say the banks will not open, you will hear:

And...........It's gone.  Poof.


Irelevant's picture

There is no doubt in my mind all the money is already gone.

(Reuters) - Banks in Cyprus will be shut on Tuesday and Wednesday pending a decision by parliament to approve a levy on bank depositors, a government source told Reuters.

"Tuesday and Wednesday are bank holidays," the source said. A decree will be released shortly from the Finance Ministry to this effect, he said.

How stupid can you be to tell a panicked crowd, whose money you hold, that you are keeping the banks closed 1 day, sorry one more day, sorry still closed, sorry try tomorrow...

The banks in Cyprus are dead and not to reopen EVER. Because if they reopen they will go insolvent in the first minute of business, so all the money is gone by now, but hope remains that sometime in 2025, upon opening said banks, only 10% of your money will be nationalized.

In Cyprus they will open NEW banks. With 0 deposits, SOLVENT! Voila, solved. In this day and age banks don`t go broke, they stay closed!

TerminalDebt's picture

Fictional Fractional banking means they hold less than 10%, when they hand over that 10% to Merkel they have nothing left for anyone.

Irelevant's picture

According to the Cypriot Constitution (art. 24/3) No tax, duty or rate of any kind whatsoever shall be imposed with retrospective effect. So much for constitutional law in the EU I guess. Its theft either way, why not just take the money and pass the law afterwards?

Besides that, why panic $100+ billion in exchange of a mere EUR 5BN?

Why keep the banks closed for 3 days, generating panic?

To many questions, to dumb for a plan!

Better yet, if they pass the law saying we will take 10% and it goes in effect without retrospective effect, why did they suspend bank activity until passing the law? No such measure has the chance to be upheld in court. I will make a educated guess :) the banks in Cyprus will never reopen in this form. NEVER. Locals will be reimbursed for a portion of the money, but all those black mob money are gone forever. Dimitri is going to be very upset.

Even better, the banks are commercial entities under the law, they are not state owned or operated, they are liable and would most likely lose in court for not opening and not respecting contracts which guarantee full access to deposits and the deposits in full. The banks are fucked either way, they will not reopen, ever.

Panafrican Funktron Robot's picture

Manufactured liquidity crisis.  The EU monetary "disunion" is a perfect vehicle for wealth transfer.  Consider, just like with Greece, the "behind the headline" transfer of public assets to private hands (part of this current deal).    

franzpick's picture

Or, they open the banks Thurs. but then announce withdrawal limits of X% per month, at which point they have established the usurpation tactic while preserving the deposit base.  And/or: they allow withdrawals beyond any new monthly limit, subject to further discounts.

I am terrified to think of what new vistas this has opened up in discussions starting to take place now at the White House, and to think about hearing GoBombEm's announcement of his "fair and balanced" u.s. version of the Cyp confiscation.


Momauguin Joe's picture

Anybody hear from Simon Black in the past 48 hours or so?

PERSAE's picture

Nasty.  Wicked nasty. 


Muddy1's picture

Yes, as a matter of fact.  He's standing in line at a bank in Cyprus hoping to get his money back and hoping to empty the safe deposit box at the same bank.  You see, he followed his own advice and had money squirreled away in foreign banks.

Panafrican Funktron Robot's picture

He'll probably claim some shit like "my core assets are in Singapore".  Yeah, good fuckin' luck getting at those assets when the SHTF there too.  

If you don't hold it, you don't own it.  Period, end of story.  

teahouse's picture

yeah... he posted something....

Muddy1's picture


Where is Jon Corzine these days?

kaiserhoff's picture

Exactly so.  These people are so smug and smart, until the unintended consequences bite them in the ass.

Prediction:  Broken windows and broke bankers ---  Bullish

JamesBond's picture

Prediction -

Obama will be coming to tax your bitcoin accounts.  Word.



McMolotov's picture

This is and will be the end of the concept of private property, at least for us proles. If the assholes in charge can reach into your bank account with government approval and take a slice for themselves and their friends, they can take absolutely anything they want from you.

The line should have been drawn long ago on a variety of issues, but if people don't stand up and draw a line in the sand right now, the thieves will be emboldened to make their future theft even more brazen. They'll be back to take everything we have.

Chupacabra-322's picture

"Forget the politicians. The politicians are put there to give you the idea that you have freedom of choice . . . you don’t. You have no choice. You have owners. They own you. They own everything. They own all the important land. They own, and control the corporations. They’ve long since bought, and paid for the Senate, the Congress, the state houses, the city halls, they got the judges in their back pockets and they own all the big media companies, so they control just about all of the news and information you get to hear. They got you by the balls. They spend billions of dollars every year lobbying . . . lobbying, to get what they want . . .

Well, we know what they want. They want more for themselves and less for everybody else, but I’ll tell you what they don’t want . . . they don’t want a population of citizens capable of critical thinking. They don’t want well informed, well educated people capable of critical thinking. They’re not interested in that . . . that doesn’t help them. That’s against their interests. That’s right. They don’t want people who are smart enough to sit around a kitchen table and think about how badly they’re getting fucked by a system that threw them overboard 30 fuckin' years ago. They don’t want that. You know what they want? They want obedient workers . . .

Obedient workers, people who are just smart enough to run the machines and do the paperwork. And just dumb enough to passively accept all these increasingly shittier jobs with the lower pay, the longer hours, the reduced benefits, the end of overtime and vanishing pension that disappears the minute you go to collect it, and now they’re coming for your Social Security money. They want your fuckin' retirement money. They want it back so they can give it to their criminal friends on Wall Street, and you know something? They’ll get it . . . they’ll get it all from you sooner or later cause they own this fuckin' place.

It’s a big club and you ain't in it. You and I are not in The big club. By the way, it’s the same big club they use to beat you over the head with all day long when they tell you what to believe. All day long beating you over the head with their media telling you what to believe, what to think and what to buy. The table has tilted folks. The game is rigged and nobody seems to notice. Nobody seems to care. Good honest hard-working people . . . white collar, blue collar it doesn’t matter what color shirt you have on. Good honest hard-working people

continue, these are people of modest means . . . continue to elect these rich cocksuckers who don’t give a fuck about you. They don’t give a fuck about you . . . they don’t give a fuck about you.

They don’t care about you at all . . . at all . . . at all, and nobody seems to notice. Nobody seems to care. That’s what the owners count on. The fact that Americans will probably remain willfully ignorant of the big red, white and blue dick that’s being jammed up their assholes everyday, because the owners of this country know the truth. It’s called the American Dream cause you have to be asleep to believe it . . .”



-George Carlin – “It’s a big club and you ain’t in it.”

Pseudo Anonym's picture

who are the "they", the "owners" you refer to?  cant you not be more specific or you just dont know because it's "they"?

daveO's picture

Look at the banksters for your answer. Ben Shalom Bernanke, for one. Poilticians are just their hired hands. 

Panafrican Funktron Robot's picture


Generally, if you control even the Danish fucking kroner, you are "they".

  • Barclays Bank plc
  • Deutsche Bank AG
  • HSBC
  • JP Morgan Chase
  • Lloyds Banking Group
  • The Royal Bank of Scotland Group

Everyman's picture

"I think we are gonna need a lot more bullets!"


Oh, wait, that is why DHS bought up all the ammo!

saucy's picture

First of all you're asking George Carlin? He's dead man. Second, if you don't know who they are you aren't one of them so get over it. Stupid fucking question.

illyia's picture

That was his best piece. A man way, w-a-y ahead of the game.

Ha. Ha. Ha. Tragic that he is no longer here. He would have too much to say.

smlbizman's picture

hes still here....he just speaks italian now......

Muddy1's picture

"If the assholes in charge can reach into your bank account with government approval and take a slice for themselves and their friends, they can take absolutely anything they want from you."

IF????  IF?????  Whaddaya mean IF???  All together now, MF Global

Jonas Parker's picture

If it's not a bank run all over Europe, the sheeple in Europe are completely asleep!

wee-weed up's picture

The liberal MSM in the US are doing their best to try to ignore what is happening in Cyprus.

Momauguin Joe's picture

Speaking of which,

Young Thai bitches are hotter than fat old bitches, bitchez.

LFMayor's picture

you getting that ad too?  It's a damn good thing I'm poor, it forces impulse control, because if I even thought I had enough money I'd call them up and tell them to send the lot.

Pseudo Anonym's picture


Young Thai bitches

not the ones with syphilis, right?

Momauguin Joe's picture

Not much of a choice is it, between the foreign syphillis, TB and God knows what else vs. the domestic aged pudgy yeast infected ground beef.

Meat Hammer's picture

Thai bitches are hot....except for their male genitalia.

Not Too Important's picture

They're also doing their best to ignore Fukushima losing all power, preventing any water cooling or replacement, and they most likely had fuel fires (whatever is left) start after about 5-6 hours.

They don't have any water to put out those fires, and TEPCO says it may take 4 days to fix the power problem.

And really, once the fires start, humans can't go on site anyway.

You think Cypress has a problem? The US is about to get slammed.

Matt's picture

3 out of 7 spent fuel ponds without circulation for several hours. That is not good:

Oh, but the Japanese have successfully extraced Methane clathrate from the bottom of the ocean, so they may have a domestic source of natural gas soon:

Westcoastliberal's picture

These banksters/politicos would fuck up a wet dream.  That's your answer.

They_Live's picture

The British extended the traditional August bank holiday before ww1 to print and distibute a new fiat currency no longer backed by gold.

Cypriots, do you know where your gold is?

Frankie Carbone's picture

So you think that Cyprus might actually consider going off of the gold standard? LOL

cornflakesdisease's picture

I believe, like Greece, it's collateral.

JOYFUL's picture

I see as of this moment Chas, 16,666 pairs of eyeballs, have read this piece. Interesting number.

None of them apparently have any problem with the thesis you let me step in...

The ideological fiction of capitalism is dead in Europe. Capitalism is a fiction if capital that is placed at risk for a return cannot be lost.

Capitalism is a fiction of "capital"...invented to replace the 'risk for return' entrepreneurial traits of traders and producers with the theory that an upper crust of parasitic moneychangers can insert themselves into the interplay between land, labor, and trade without harm to both the social fabric and the ability of markets to function as real arbitrators of that interplay.

Failing to understand the fiction of capitalism places the rest of your thesis in terminal fail mode. This is the moment of 'capitalisms' denouement and highest stage...when state and monopolistic cartels merge into an uber-criminal class which needs no longer hide itself behind the veil of 'democracy' or the rule of law.

PILLAGE is the religion of capitalism...and the myth of social democracy is the opiate of the people it preys upon.

Weishaupt, Mazzini and Pike and Hughes-Smith...mouthpieces of the kabbalistic konspirators who kreated 'kapitalism.'

bank guy in Brussels's picture

We actually have plenty of guns in Europe, and there are plenty of home civilian loaded firearms in Cyprus and Greece too

Perhaps about 100 million privately owned civilian European guns, especially concentrated in Western Europe

Huge number of Greek and Cypriot families have long guns, especially shotguns

The 300 million firearms in the USA do not seem to have prevented America from going fascist ... with 2.3 million prisoners in the US concentration camp gulag, and constant theft of assets via corrupt US courts and lawyers, and things like MF Global, Peregrine and Sentinel bank confiscations ... and now guns getting confiscated in California etc.

In fact we Europeans are much better and effective at street demonstrations, political general strikes shutting down an entire country, and political rioting ... in the USA people fear the 20-year prison sentence for 'terra-rism' so they stay at home with their guns no matter how bad it gets

We have real political revolutions in Europe unfolding, like with Beppe Grillo in Italy ... this theft of bank deposits in Cyprus by the European Commission, will intensify those populist revolutions

So don't think Americans are the only ones with 'guns' ... we Europeans just bluster and brag about them less, we know it is the last resort against the Nazis and fascists, with whom we have some very valuable experience ...

Facts of gun ownership and policies in countries around the world:

LFMayor's picture

Shit, we just ain't played Metroseckshuls vs. Rednecks yet.  

Wait for it...

Binko's picture

Good point, Bank Guy. Americans are too scared and too stupid to hit the streets. Instead they stay home, fondle their guns and shoot off their mouths. At least Europeans still know how to protest.

What do all these Americans with lots of guns imagine will happen when things get really bad? Do they think that thousands of citizens with guns will band together in some kind of organized militia and fight for positive change? That's the most laughable thing I've ever heard. People will just hunker down, protect their own and blast away at their neighbor.

We saw what happens to protesters in America when the Occupy movement actually tried to get out and protest. You may agree with Occupy or disagree with Occupy but, either way, you should be scared shit-less at the way they were beat down and marginalized.

You want to protest in America? Here, you can walk quietly down this one street in this one direction for exactly this much time and if you deviate from the rules the great seething angry mass of militarized police will rip into you and toss you into the maw of our twisted "justice" system where walking wrong can get you charged with a dozen different felonies.

LFMayor's picture

"Occupy" was a protest?  I thought it was just some hygenically challenged beatnik sleepover.

Protests are worth about a squirt of piss in a forest fire.  Just like emailing, calling or writing your congressman.  Or voting for or against the motherfucker, for that matter.  It's all just a form of self gratification to make you feel like you DID YOUR PART, CITIZEN.

Out here in flyover, there are lots of gats n shit that have been bought.  Still flying off the shelves, when a trickle arrives to be sold.  Rednecks are busy, casting wheel weights, pulling the handles on RCBS, Dillon and Lee machines, steadily cranking out things that go bang.

Just because your TV hasn't been loaded with images of "protestors" for your gratification doesn't mean shit's not being stacked up.  These are hunters, they sit their ass motionless in the worst kinds of weather just for the small hope of committing some violence.

They wait for the shot, not your plaintive Feman whining.

cornflakesdisease's picture

I overflowing Wal Mart Toilet, (yes, that's me).  I prefer small suttle ways to protest.  The huge trail of fruit punch at Target?  Me again.

Archduke's picture

sort of.

in some countries europeans own shotguns.
practically no one owns long range long rifles.
france for example bans any military cartridge,
which pretty much rules out most .30 cal.

saucy's picture

Yeah right dude. I live in Europe and wanted to get a gun. I live in the EU country with the most liberal gun ownership laws. Let me tell you it's easier to cure cancer than get a fucking firearm here or anywhere in the EU. You even need a note from a doctor to get one! I've got 6 guns back in the U.S. Bought one of those bad boys at Walmart and took it home the same day. I haven't seen a firearms dept. at Tesco.

Kinskian's picture

The 300 million firearms in the USA do not seem to have prevented America from going fascist ... with 2.3 million prisoners in the US concentration camp gulag...

Can you still do hard time in a European prison for doubting the veracity of six million dead Jews in WWII? Are you going to argue that somehow this equates to Europeans having more freedom than Americans?

The US has many faults but we have yet to resort to putting people in prison based on their opinions or interpretations of events that took place seventy years ago. If we do start doing such a thing, our politicians will no doubt look to Europe for inspiration in drafting the legislation. 

You Europeans might have experience in standing up to "fascists", but you haven't had much success in shaking off the influence of the communists or the ones David Irving used to call "the traditional enemies of freedom".