Daniel Hannan Urges Cyprus To "Default, Devalue, And Decouple" Itself Back To Growth
"Either Cyprus is going to have to find the money to fund the bailout, or it's going to have to leave the Euro - to default, devalue, and decouple," is the cold hard truth that UK MEP Daniel Hannan explains in this brief clip. Neither of these paths, he goes on to say, is an easy one, but he believes "there is no doubt the second of them is the less painful - allowing Cyprus to price itself back into the market and start exporting its way back to growth again."
There are no good outcomes for a country as indebted as Cyprus is, "but if I were a Cypriot member of Parliament, I would vote now to go back to an independent currency as the least painful of the various difficult options." Hannan then makes a fantastic point, "in the rest of Europe, we have measured the cost of monetary union in unemployment, deflation, poverty, and emigration; in Cyprus that wasn't enough, they have had to gouge the savers directly," and so the Cypriots who claim to want to stay in the Euro can now quantify the cost of that shackle, as he reminds us that , "you don't have to be a Russian oligarch to have EUR 100,000 in the bank," as he concludes, "the really interesting question is - who's next?"
Now that the precedent has been set (that governments can come after what is in your savings account) what country is safe?
(22 votes)
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Hey now, no fair talking commin sense, Minister.
I love this guy.
It's either now or later, malaka!
If only it were so easy. Do you think the Russians will happily accept a new currency in place of their Euros?
Cyprus is going to get "foreclosed."
'Foreclose' is the new "Terminate with extreme prejudice'
As much as I share his proposal - what growth from what kind of , eh, business? growing sheeps? Isn't the world full of them already?
Global bank run in 5... 4... 3... 2...
I think Daniel Hannan is the most outstanding American Constitutional Statesman of our time.
I wish we had someone of similar wisdom and eloquence here.. in the United States.
-- a great speech.. at a more hopeful time:
http://www.youtube.com/watch?v=6doBZ_PPJCY
Iceland those Bitchez!
Once you go Icelandic, you never go back.
Sovereign nations (especially the U.S. and UK) have to make up their minds and either regulate the banks as utilities (not my preference, but still better than unlimited taxpayer $$$ subsidies-- that fund excess & non-market anything related compensation/bonuses of employees and executives-- and too-big-to-fail-- meaning endless rounds of saving them from gambling addiction -- & allegedly-too-big-to-jail status) or let them sink or swim by their own managerial (in)competence and the (un)soundness of their (mal)investment/loan portfolios, period.
Crazy talk! You mean leave it all to a free market? Madness!
+1. though "bank as utilities" is my preference, and I'm not alone, here
That's right, GS: Malaka!
"Don't fool yourself.. it's winking at you... I'd knew you'd be surprises!" - F. Zappa.
He talks sense sometimes, but his false trumpetting of Tory 'acheivements' has irked me too often. The man even tried to claim that an Osborne led Treasury was being fiscally responsible, and made no mention to deficit reduction by nationalisation of pension assets.
"exporting its way back to growth again"
That makes no sense at all. The guy is behind the times. Cyprus won't find a market for its goods in a down global economy suffering from sky-high energy costs.
All the bail outs are about the failure of the growth engine. That game is over and it is never coming back.
Bullpucky. There's no way out without abolishing usury and fake debt dropping the euro and making real government printed money. Cypriots? Cypros? Olive loafs? or just use a piece of wood with notches. Screw the belgian bastards... There's nothing more derogatory than "belgian".
"Belgium man, Belgium!" -- Zaphod Beeblebrox, "HitchHikers Guide to the Galaxy"
This would not please the squid... ergo, its not going to happen.
Agreed. It might catch on too once the remainder of the troubled EU members (read: "most") realize that self imposed austerity and some modicum of self determination may the lesser of two evils.
I were a Cypriot member of Parliament, I would vote now to go back to an independent currency as the least painful of the various difficult options.
Straight out of the Argentina 2001 playbook.
Cyprus already has the corralito. Why not the debt relief too?
I'll fix this mess. Somebody get this link to the Cypriot leaders. Tell them they can give their regards to Drs. Greenspan, Bernanke, Krugman ect.
http://www.delarue.com/ProductsSolutions/BanknoteProduction/
Better still: A GOLD & NATGAS-BASED RUBLE! GAZ(PROM) the IMF, BIS!
"Cyprus already has the corralito. Why not the debt relief too?" and the soft currency that goes with it? wonder if Cypriots want that
Exactly. If the new notes are worth half as much as Euros, that is a 50% haircut for ALL depositors.
Well it sure as f**k ain't New Zealand
http://www.scoop.co.nz/stories/PA1303/S00306/national-planning-cyprus-st...
I keep waiting for some Eurocrat with a cameraman to walk out from behind a bush in Cyprus to inform the planet that we're all on Candid Camera.
So....your cosmic bunny hole has also gone super nova. Glad I'm not alone.
"...but if I were a Cypriot member of Parliament, I would vote now to go back to an independent currency as the least painful of the various difficult options." .."
god almighty, someone with intelligence who is also a politician....i hope his life insurance is current....
You really think printing your own currency (at what devaluation?) is less painful than just letting Gazprom drill of natural gas?
Hannan is being his usual polemical self. The Brezhnev Doctrine made it clear in 1968 that Czecoslovakia could not deviate from the doctrine of the Warsaw Pact and that Dubcek was a heretic. In much the same way the Euro is an indisoluble union so Cyprus cannot be permitted to leave or to default of find a solution to its problems that deviate from the program. They have botched the first attempt and the Cypriot President has botched this just as he botched the proposals to sort out the divided island when nobody backed his proposals in the referendum.
The Troika will attempt to get Putin to stump up the readies and they will tell him all about their Brezhnev Doctrine.....in case he has forgotten
Juncker promised war in Western and Northern Europe. How is that going to happen.
...what country is safe?
Surely this couldn't happen in the US of A?
/s
No way it can ever happen here.
Krugman said so - an' he's gotta Nobel Prize thingie
No, merely an idiot.
"Here, central bank, PLEASE take 5-10% of the value of my savings annually! I'm too much of a sheep, or an ignorant fool, to do anything wiser or safer with it than allow you to continually devalue it!"
Russian drug dealers don't play nice.
shallow graves take valuable time
boris doesn't get blisters...
i respect ther shit...
a nod of understand.
With moral and honest leadership focused on getting the country back on its feet in the fairest and most painless method possible, this would be the best approach.
As if that is possible in our world today.
Any option out of the Euro is still better than being stuck forever in the dead-end deal that the EU offers today.
sschu
How come the Iceland answer isn't more popular?
Because it worked and it screwed the vested interests.
It is very popular. But in a world ruled by the Powers who create fiat currency, popularity does not matter. The politicians do not serve the voters.
The only way it happened in Iceland is that they gathered around their parliament building and threatened to go Viking.
Gazprombank was in Cyprus
Gogle translation
http://www.livenews.com.cy/cgibin/hweb?-A=12715&-V=economy
'The Cyprus pound was replaced by the euro as official currency of the Republic of Cyprus on 1 January 2008'
http://en.wikipedia.org/wiki/Cypriot_pound
That was only five years ago!
I could print these on my inkjet:
http://www.leftovercurrency.com/Resources/banknote-1-cypriot-pound-1995.jpg
Maybe they should call their new currency the Cyprus Ounce.
Probably you meant to type 'the Cyprus OUCH' ...
Cyprus Gram
Medusa played rugby?
Silver gold and bit coin bitchez
He has met our friend MDB yet. I have an MDB to sell ya!
Well yeah. Print yourself to the moon in your own currency like the UK.
I, for one, am thankful that the EU is heading for a collapse at a glacial speed. just moves the US' eventual day of reckoning farther out in the future. I might even be able to steal a few more years of paychecks before chicken's come home to roost.