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Europe's Final Gambit: 20%-30% Haircut For Oligarchs To Force A Russian Bailout

Tyler Durden's picture




 

It now seems sure that the ongoing discussion in Cyprus' government will see a "no" vote as the WSJ is reporting a rather stunning gamble by the Cypriots (and by Cypriots we mean European leaders) to force the Russians to bear the brunt of the cost of the bailout. The non-resigned Cypriot FinMin is heading to Russia to propose a deal that includes imposing a 20% to 30% levy on Russian-held deposits in Cypriot banks, which could cost them billions of euros. In exchange, Russia will be given equity in Cyprus's future national gas company and some additional strategic benefits in the sector, while Russian investors would be given control of the board of directors at Cyprus's banks. The apparent quid pro quo in this deal does nothing to hide the fact that private property was stolen and while pointing fingers just at the Russians may play well for PR purposes, it is described as "a long shot" as the Kremlin notes, "it's practically impossible to talk without knowing details."

 

Via WSJ,

...

 

The official said that Michalis Sarris, who is being accompanied by a delegation of businessmen, is going to propose a deal that includes imposing a 20% to 30% levy on Russian-held deposits in Cypriot banks, which could cost them billions of euros. In exchange, Russia will be given equity in Cyprus's future national gas company and some additional strategic benefits in the sector, while Russian investors would be given control of the board of directors at Cyprus's banks.

 

...

 

However, the deal looks like a long shot. Ahead of the visit, Kremlin spokesman Dmitry Peskov said: "It's practically impossible to talk without knowing the details."

 

"The situation is very difficult--unprecedented--and we don't understand what's happening," he said. Mr. Putin hasn't spoken to his Cypriot counterpart, he added.

 

"We don't know about the visit [on Wednesday] because we have information that the [Cypriot] finance minister has offered his resignation. Since we don't know if Cyprus has a finance minister, we can't comment on proposals that he might make," he said.

 

...

 

Mr. Anastasiades hinted that the government is already working on a plan B. "We have our own plans," he said.

 

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Tue, 03/19/2013 - 14:22 | 3348505 Tinky
Tinky's picture

I got an idea! Let's play hardball with Putin! He's bound to fold like a cheap tent...

Tue, 03/19/2013 - 14:28 | 3348591 fx
fx's picture

Yeah, Plan B. Perhaps a year or two late and a couple billion Euros short? Not that this was all unforeseeable...

Tue, 03/19/2013 - 14:35 | 3348661 strannick
strannick's picture

As the ever-depricating value of fiat becomes ever more obvious, if I was Putin, I'd take an 15% cut, insist on future gas revenues, and a Cypriot port for tankers and the occasional warship to ''monitor the situation'', which in turn would of course become a full fledged Russian Cypriot naval base.

Tue, 03/19/2013 - 14:45 | 3348708 hedgeless_horseman
hedgeless_horseman's picture

 

 

Who is going to England to impose a levy on the Limeys in order to keep their naval bases in Cyprus? 

And just how much are they paying a year in rent for all that beach front property?

 

Call it an Empire Tax.

Tue, 03/19/2013 - 14:54 | 3348782 TJ00
TJ00's picture

That's not fair, we invite them over all the time for tea and biscuits, and maybe even a scone if they play there cards right.

Tue, 03/19/2013 - 15:11 | 3348894 MiguelitoRaton
MiguelitoRaton's picture

So take the money from Russian Mafia, then give Russia control of the banks and natural resources, so there is no way to restart the economy after ultimate failure...GENIUS. I'm long mafia kidnappings in Cyprus.

Tue, 03/19/2013 - 15:49 | 3349144 MrNude
MrNude's picture

You aren't wrong man.

Ask the FEDS about the broad daylight shootings and kidknappings by Russian Mafia up in Brighton Beach Brooklyn or MI5 about the hits like Alexander Perepilichny in London.

These clowns picked the wrong group of people to mess around with this time, someone will end up being made example off because they entertained the very principle of stealing Russian Mafia money.

It aint no boogey man story, these guys are real, well trained, well organised and international and don't give a fuck, someone is going to end up vanishing or falling out of window, getting lost at sea or having a weird accident or death. It could be this week, it could be six months from now etc. etc. but it will happen to send out a message you can bank on it

Tue, 03/19/2013 - 15:53 | 3349178 lolmao500
lolmao500's picture

Finally good news.

Tue, 03/19/2013 - 16:23 | 3349309 fourchan
fourchan's picture

how you say sleeps with da fish in russian?

Tue, 03/19/2013 - 18:21 | 3349913 grunk
grunk's picture

Hey! There's a finger in my caviar!

Tue, 03/19/2013 - 16:04 | 3349223 Nobody For President
Nobody For President's picture

I know I can bank on it - the problem is, which bank?

Tue, 03/19/2013 - 20:00 | 3350321 sun tzu
sun tzu's picture

If we're lucky, some banksters will be sleeping with the fishes

Tue, 03/19/2013 - 15:13 | 3348919 SWRichmond
SWRichmond's picture

some additional strategic benefits in the sector

Russia Wants Naval Bases Abroad, Navy Chief Says

07/27/12

http://www.huffingtonpost.com/2012/07/27/russia-naval-bases-abroad_n_170...

 

Deepwater ports:

http://en.wikipedia.org/wiki/Famagusta

 

Tue, 03/19/2013 - 15:43 | 3349128 thisandthat
thisandthat's picture

As long as you ignore the fact that Famagusta is actually the capital of the Turkish Republic of Northern Cyprus...: http://en.wikipedia.org/wiki/Famagusta

Tue, 03/19/2013 - 14:45 | 3348773 Texas Ginslinger
Texas Ginslinger's picture

My theory on all this is that the west is forcing Putin to action on behalf of their ultra-wealthy, which (they hope) will seriously start to undermine his support for the common Ruskie.

Time to start taking him down a notch..??

Tue, 03/19/2013 - 15:49 | 3349133 Lore
Lore's picture

Common folk don't follow this sort of thing in any detail, but even if they do, the issue of depositor theft resonates with everyone.

I think the price of LNG next winter will be the Russian response.  Whatever Russian "oligarchs" lose will be reimbursed quickly by Gazprom customers in Europe.

Be sure that nations on the Russian periphery are re-examining their choice of friends.

Maybe the Chinese would lend a helping hand...?

Tue, 03/19/2013 - 16:07 | 3349241 Texas Ginslinger
Texas Ginslinger's picture

Yes, it will be interesting to see if the natural gas supply to the EU (from Russia) is interupted by this. 

Keep in mind that Cyprus is a tax haven.  I'm sure that has something to do with this decision as well.

Maybe it sends 2 messages - one to tax dodgers (run with your $$, but you can't hide it) and one to Putin (get ready to have your chain rattled).

Tue, 03/19/2013 - 16:17 | 3349258 Lore
Lore's picture

Yah. This is very much on par with the recent quest by American authoritah for tax-dodging evildoers in Switzerland and the Caymans. There's a sense that esoteric circles are engaged in some process of weeding.

Tue, 03/19/2013 - 15:53 | 3349174 Lost Word
Lost Word's picture

Plan B : The USA buys Cyprus and gets the rights to the Natural Gas.

Tue, 03/19/2013 - 14:30 | 3348611 Tortfeasor
Tortfeasor's picture

Brilliant idea - put the ruskies in charge of banking AND give them hard oil assets as well. And this is an improvement?

Tue, 03/19/2013 - 14:38 | 3348701 redpill
redpill's picture

The Bear chuckles, back in the old days they had to invade the place for these sorts of benefits!

Tue, 03/19/2013 - 14:41 | 3348742 fuu
fuu's picture

Cyprus doesn't even have any Mujahideen.

Tue, 03/19/2013 - 14:55 | 3348787 Cult_of_Reason
Tue, 03/19/2013 - 15:38 | 3349099 redpill
redpill's picture

I wonder if those Mi-24s they sold the Cypriots had hidden self-destruct mechanisms....

Tue, 03/19/2013 - 16:29 | 3349333 Go Tribe
Go Tribe's picture

We'll be selling the Bakken to the Chinese soon enough in return for debt forgiveness.

Tue, 03/19/2013 - 18:47 | 3350056 Matt
Matt's picture

"Brilliant idea - put the ruskies in charge of banking AND give them hard oil assets as well. And this is an improvement?"

The Russian offer was to bailout Cyrpus, and in exchange, Gazprom would get the oil and gas rights.

The Cypriot counteroffer is that Russia bails out Cyprus, and in exchange, they get shares for X percent control of the banks and the soon-to-be created Cyprus State Oil and Gas company.

While it seems they are giving them both the banks and the oil and gas, the difference is in the percent of control of each, and in having the gas company owned by Cyprus rather than Russia.

Tue, 03/19/2013 - 14:39 | 3348719 Freddie
Freddie's picture

How is Putin any worse than the EUSSR, Obummer or the US House and Senate?  I bet you voted for O. 

Tue, 03/19/2013 - 14:41 | 3348739 redpill
redpill's picture

Putin doesn't even give you an "Islamic" ritual burial at sea within 24 hours.  He just pisses vodka on your corpse.

Tue, 03/19/2013 - 16:01 | 3349210 JohnnyBriefcase
JohnnyBriefcase's picture

Makes me wish I were Russian...

Tue, 03/19/2013 - 16:06 | 3349231 Freddie
Freddie's picture

YouTube has some of the RT videos of the Russian Navy dealing with Somali pirates.  The Russian do not do politically correct with Africans like Hope & Change.  Putin knows Amerika is a joke now. 

The Somalis are target practice for the Russians.

Tue, 03/19/2013 - 14:42 | 3348746 blu
blu's picture

"Mr. Putin hasn't spoken to his Cypriot counterpart, he added."

There is another bad-ass as bad-assed as Putin? And he's from Cyprus?

WTF man, that's blowing my mind.

Wait hold on. I get a bad feeling. Let's not ever let these two sit down over lunch or anything.

Tue, 03/19/2013 - 15:05 | 3348842 blabam
blabam's picture

I lol'd +1

Tue, 03/19/2013 - 14:43 | 3348759 mr1963
mr1963's picture

Yeah, Russia getting their hands on more of the energy supply Europe needs is a win/win for Russia and a monster loss for Europe. Europe will pay for this big time.

Tue, 03/19/2013 - 16:31 | 3349341 Go Tribe
Go Tribe's picture

Long Russian equities and gold.

Tue, 03/19/2013 - 14:43 | 3348761 TJ00
Tue, 03/19/2013 - 15:45 | 3349141 thisandthat
thisandthat's picture

Why would Putin explode a PAK-FA is beyond me...

Tue, 03/19/2013 - 16:43 | 3349401 Pairadimes
Pairadimes's picture

"The non-resigned Cypriot FinMin is heading to Russia to propose a deal that includes imposing a 20% to 30% levy on Russian-held deposits in Cypriot banks, which could cost them billions of euros."

 

There is a decent chance that the Cypriots will be getting their FinMin back one fingertip at a time.

Tue, 03/19/2013 - 14:21 | 3348507 MsCreant
MsCreant's picture

Drama. I wonder if THIS was the real destination all along. Make it formal that this is a Russian banking system, give them the GAZZZ.

Tue, 03/19/2013 - 14:25 | 3348551 Bastiat
Bastiat's picture

Backdoor Russian bailout in exchange for gas?

Tue, 03/19/2013 - 14:29 | 3348608 Confundido
Confundido's picture

That was it all along...all along.

Tue, 03/19/2013 - 14:41 | 3348722 Manthong
Tue, 03/19/2013 - 14:30 | 3348619 fx
fx's picture

That would make for an interesting military confrontation between Turkey and Russia. It's absolutely laughable to offer the Russians resources (in exchange for their own bail-out) that they already have plenty of - and that Cyprus cannot get its hands on anyway. Talk about mortgaging your neighbour's house...

Tue, 03/19/2013 - 16:03 | 3349221 css1971
css1971's picture

Turkey?

You realise the UK has 2 military bases there? It ain't happening.

Tue, 03/19/2013 - 14:26 | 3348560 kaiserhoff
kaiserhoff's picture

Yaz, motivation is the key.  What does it mean if Ben doesn't bail them out, which he could easily do with a repo, a CDS deal, a reverse triple sowcow..., WTF?  There  is no audit.  They can counterfeit anyway they want.

If Ben doesn't bail them, it must mean that God/Lloyd likes the idea of a disorderly collapse of the Euro and is already positioned for it.  Gawdhelpus.

Tue, 03/19/2013 - 14:32 | 3348634 McMolotov
McMolotov's picture

I love all this "free market" shit we've got going on.

Tue, 03/19/2013 - 15:07 | 3348844 hedgeless_horseman
hedgeless_horseman's picture

 

 

Indeed.  This is the point where the Monopoly game gets a little wild, nobody is taking turns to roll the dice, but everyone is making side deals...trading Marvin Gardens for a blow job and Vermont Avenue for two beers.  What is that?  The Free Parking money is missing?  Go figure.

Tue, 03/19/2013 - 15:09 | 3348879 MsCreant
MsCreant's picture

Your Monopoly games get pretty wild. Congrats. Sounds like fun for you and your wife. I need to get my husband to play, I had no idea...

Tue, 03/19/2013 - 15:15 | 3348930 Bastiat
Bastiat's picture

Is that a "spot" bj or futures? It matters as bj futures are in strong backwardation (counterparty risk).

Tue, 03/19/2013 - 14:28 | 3348509 TruthInSunshine
TruthInSunshine's picture

Paul "I Was For the Federal Reserve Inflating A Housing Bubble Before I Was Against It" Krugman just tweeted that there should be 100% confiscation of Russian deposits in exchange for a 100% stake in Cyprus's strategic missile defense shield.

Tue, 03/19/2013 - 14:21 | 3348510 Navymugsy
Navymugsy's picture

It's all about da' gas!

Tue, 03/19/2013 - 14:21 | 3348513 camaro68ss
camaro68ss's picture

Russians in charge of the banks. haha,

good luck getting your cash out now

Tue, 03/19/2013 - 14:22 | 3348517 orca
orca's picture

At the Kremlin they are busy making polonium cocktails to welcome the esteemed guest.
Do not fuck with the Ruski's.

Tue, 03/19/2013 - 14:39 | 3348715 MagicHandPuppet
MagicHandPuppet's picture

Bullish polonium-210, Bitchez!

Tue, 03/19/2013 - 16:26 | 3349324 Lmo Mutton
Lmo Mutton's picture

If you are long Po you have been had...

"Applications of polonium are few"

Tue, 03/19/2013 - 19:12 | 3350146 Matt
Matt's picture

Applications for Polonium-210:

1) murdering people

2) using the threat of murdering people to coerce people into doing / not doing things.

Personally, I thought Poland should have amassed a quantity of Polonium-210 for artillery shells, they could have either deterred Germany from invading them, or irradiated their troops if they got attacked anyways.

Tue, 03/19/2013 - 15:50 | 3349165 Fuh Querada
Fuh Querada's picture

a ricin-tipped umbrella thrust into  the left buttock is faster - they say

Tue, 03/19/2013 - 21:53 | 3350735 SHRAGS
SHRAGS's picture

But far less painful...

Tue, 03/19/2013 - 14:22 | 3348518 SheepDog-One
SheepDog-One's picture

It's come down to guns to peoples heads! 

Tue, 03/19/2013 - 14:45 | 3348772 blu
blu's picture

Times like these, it always comes down to a gun against someone's head.

Tue, 03/19/2013 - 14:23 | 3348528 Sheeple Shepard
Sheeple Shepard's picture

This is getting really fuckin' messy quick.

 

Currency wars, trade wars, world wars?

Tue, 03/19/2013 - 14:56 | 3348790 blu
blu's picture

You forgot resource wars.

We're seeing one play out right now. And I think the Russians won it in less than 48 hours.

Tue, 03/19/2013 - 15:11 | 3348897 reload
reload's picture

Unless Syria is also in play? would Putin stand aside there and let UK/USA/FRANCE/Saudi put boots on the ground in return for Cyprus? Personally I strongly doubt he would do that trade out of choice....but it could be a very decent consolation prize if he thought Syria was going to fall apart anyway.

Reports that rebels and government forces inside Syria are each accusing the other of chemical weapn use today.

The next distraction could be on deck pronto: Nato `humanitarion/peacekeepers` in Syria.     

Tue, 03/19/2013 - 15:59 | 3349202 Lost Word
Lost Word's picture

Russia has not yet won. USA Ben could buy Cyprus and the Natural Gas rights.

Tue, 03/19/2013 - 14:23 | 3348530 insanelysane
insanelysane's picture

Wimpy from Popey would say, "I'll gladly pay you Tuesday for a hamburger today."

Wimpy the EU member says, "I'll gladly take euros today for some nat gas on Tuesday."

Tue, 03/19/2013 - 14:24 | 3348532 Schmuck Raker
Schmuck Raker's picture

Cyprus bank levy bill defeated in Parliament, Bloomberg reports

 

Via The Fly 14:19

Tue, 03/19/2013 - 14:23 | 3348534 akarc
akarc's picture

"Anastasiades hinted that the government is already working on a plan B. "We have our own plans," he said."

How many plans that don't work can you call "B"?

Tue, 03/19/2013 - 14:28 | 3348589 SheepDog-One
SheepDog-One's picture

Yea....and what the fuck WAS 'Plan-A' anyway?? More kornholing of the peasants?

Tue, 03/19/2013 - 15:34 | 3349070 Esso
Esso's picture

Kornholing the peons is ALWAYS Plan-A.

Tue, 03/19/2013 - 14:25 | 3348547 earleflorida
earleflorida's picture

~$ Trillion for a few $Billions sounds like a good rounding error?

Tue, 03/19/2013 - 14:25 | 3348555 optionsman
optionsman's picture

all non-Russian assets are safe. if the Russians dont agree to the terms well balme everything on the Russians. what a mess.

Tue, 03/19/2013 - 14:28 | 3348561 Kirk2NCC1701
Kirk2NCC1701's picture

Not a bad way to buy an EU island in the middle of the Mediterranean, get to take over the gray and dirty Russian money accounts, build a naval port and surrounded by vast gas reserves.  Totally strategic.  Sail on, damn those French torpedoes, full steam ahead!  Putin's a fucking genius!

Tue, 03/19/2013 - 14:36 | 3348688 earleflorida
earleflorida's picture

greatest 'Chess Master's in the Universe', are they!

Tue, 03/19/2013 - 14:39 | 3348711 VonSalza
VonSalza's picture

Russia is on the verge of losing their naval base in Syria, so a new one in Cyprus would be more than welcome.

Tue, 03/19/2013 - 14:58 | 3348805 Bastiat
Bastiat's picture

Yeah, through in a naval base for a deal sweetener. And since their expensive to build let the Brits fuck off and we'll take theirs.  They're broke too.

Tue, 03/19/2013 - 14:59 | 3348810 SmallerGovNow2
SmallerGovNow2's picture

How are they losing the Syrian base?  Think the rebel's are going to take it from them?  I don't think so...

Tue, 03/19/2013 - 15:49 | 3349159 Arkadaba
Arkadaba's picture

Given the Finance Minister was en route to Russia before the vote, I tend to think this is a done deal ... well for now. 

Tue, 03/19/2013 - 15:51 | 3349166 Fuh Querada
Fuh Querada's picture

Reggie says those gas reserves aren't worth dick.

Tue, 03/19/2013 - 14:27 | 3348585 slackrabbit
slackrabbit's picture

Russia would just turn off the gas.

Tue, 03/19/2013 - 15:42 | 3349119 bank guy in Brussels
bank guy in Brussels's picture

Here's the Russian military chorus on television, laughing and singing about exactly that -

Turning off the gas to Western Europe

With English subtitles, very funny -

They turn off a mock cutoff valve on stage while everyone laughs and cheers

http://www.youtube.com/watch?v=A7RD5ONjv8M

Tue, 03/19/2013 - 14:28 | 3348592 WhiteNight123129
WhiteNight123129's picture

How about a naval base in Cyprus, I think Putin would go for that, backstopping deposits against a naval base sounds like a good deal.

 

Tue, 03/19/2013 - 14:30 | 3348617 Confundido
Confundido's picture

Better than against LTRO money backstopped by Spanish bonds, eh?

Tue, 03/19/2013 - 14:32 | 3348596 earleflorida
earleflorida's picture

and now we know why Syria's, Tartous port has a valid parking functionality de`jour 

Tue, 03/19/2013 - 14:29 | 3348599 Mad Mohel
Mad Mohel's picture

Remember that scene in "300" where Leonidas kicks that black emissary down the well while yelling like a madman? I imagine that this idiot Cypriot's visit to Moscow will play out in a similar fashion.

Tue, 03/19/2013 - 14:30 | 3348605 fuu
fuu's picture

""We don't know about the visit [on Wednesday] because we have information that the [Cypriot] finance minister has offered his resignation. Since we don't know if Cyprus has a finance minister, we can't comment on proposals that he might make," he said."

Just grab a dude in the hall playing Angry Birds on his phone.

Tue, 03/19/2013 - 14:41 | 3348734 MsCreant
MsCreant's picture

LOL!

Tue, 03/19/2013 - 14:31 | 3348629 Hughing
Hughing's picture

It's hard to believe but, Brussels/Berlin managed to fu%k this up. What won't the Russians get? 10b Euros? A few fingers, some thumbs, a nice beach house; they'll survive

Tue, 03/19/2013 - 14:39 | 3348709 slightlyskeptical
slightlyskeptical's picture

It's hard to believe that anyone is dumb enough to offer the Russians a 20-30% haircut in person.


Tue, 03/19/2013 - 14:32 | 3348637 Catullus
Catullus's picture

You're giving away too much Cypriots. Putin would take the haircuts just to get the list of names of Russians with money in Cyprus. Then ask them how they got so much money.

If you're a Russian with an account in Cyprus, leave Russia now.

Tue, 03/19/2013 - 14:37 | 3348689 insanelysane
insanelysane's picture

Are you crazy?  That is like saying the US government would love a list of every Goldman and JPM manager so they can prosecute them.  Putin is in power and alive because the people with money want him there.

Tue, 03/19/2013 - 14:41 | 3348741 Catullus
Catullus's picture

You may not have noticed how autocratic Putin has become, but he's not in office because people in money want him there. If you're in Russia and rich, it's because you're on someone's good side. Not the other way around.

Putin probably has billions to his own name all over Russia. His thugs just take what they want.

Tue, 03/19/2013 - 14:40 | 3348652 Downtoolong
Downtoolong's picture

going to propose a deal that includes imposing a 20% to 30% levy on Russian-held deposits

If I had to face a bunch of Russians on their turf with a proposal like this, I would have tried to resign too.

The one-way tickets weren't exactly a confidence builder either.

Tue, 03/19/2013 - 15:48 | 3349152 Fuh Querada
Fuh Querada's picture

LOL They must be fucking crazy - they'll get their knees rearranged just for starters.

Tue, 03/19/2013 - 14:34 | 3348664 insanelysane
insanelysane's picture

Is this the part of the movie when the Russians send the Cypriot Finance Minister back to Cypress on horse and the finance minister is dead with a note on arrow that is stuck through his body???

Tue, 03/19/2013 - 14:37 | 3348675 slackrabbit
slackrabbit's picture

Meanwhile at EU HQ: Hang on, a Russian gas deal between voluntary partners and no blackmail?  What the hell kind of deal is that?

Tue, 03/19/2013 - 14:40 | 3348724 insanelysane
insanelysane's picture

EU HQ is also waiting to read a press release sent by the US bankster elites that will trigger the algos and send stocks higher.

Something along the lines:  Cypriot miners find 100 metric tons of gold

Tue, 03/19/2013 - 14:36 | 3348683 holgerdanske
holgerdanske's picture

Pee in the pants!!!

It's nice and warm when you do it.

 

Why worry??

 

 

 

 

 

 

Tue, 03/19/2013 - 14:37 | 3348697 TJ00
TJ00's picture

Don't they realise the Russians can get all their money back and more simply by shorting the EUR and nuking Brussels?

Tue, 03/19/2013 - 14:37 | 3348698 Fix-ItSilly
Fix-ItSilly's picture

The EU and EZ can't permit this to happen.  Russia would have a banker's undemocratic control of Cyprus, through an off balance sheet entity giving lip service to the ECB, primarily funded by European nations and their serfs who will bear most of the risk with no geopolitik control, legitimacy and goodwill.  A Central Bank collision with a national banking system devised like this will suck Europe dry just as Romney sucked dry his "turnarounds".

 

Then again, maybe Europe has not read Thomas Jefferson?  :

"I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered.'

Tue, 03/19/2013 - 14:38 | 3348699 Fix-ItSilly
Fix-ItSilly's picture

The EU and EZ can't permit this to happen.  Russia would have a banker's undemocratic control of Cyprus, through an off balance sheet entity giving lip service to the ECB, primarily funded by European nations and their serfs who will bear most of the risk with no geopolitik control, legitimacy and goodwill.  A Central Bank collision with a national banking system devised like this will suck Europe dry just as Romney sucked dry his "turnarounds".

 

Then again, maybe Europe has not read Thomas Jefferson?  :

"I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered.'

Tue, 03/19/2013 - 14:38 | 3348707 TheLooza
TheLooza's picture

Putin: Yes, we are very interested in this proposal. Please come right away so we can discuss. Oh, feel free to bring your wife and kids, Siberi---ur I mean Moscow is beautiful this time of year.

Tue, 03/19/2013 - 14:42 | 3348713 earleflorida
earleflorida's picture

Question:   Can you slant drill in the 'dragon sea of leviathan's'?

Tue, 03/19/2013 - 14:39 | 3348718 q99x2
q99x2's picture

Is Greece going to Fucking default. How bout you just tell me that.

Tue, 03/19/2013 - 14:41 | 3348735 Oligarch
Oligarch's picture

banksters vs gangstaoligarchs. Interesting ...

Tue, 03/19/2013 - 14:41 | 3348736 Piranhanoia
Piranhanoia's picture

Yesterday,  Putin was looking at the gun.  Today, he is pointing it.  Tomorrow, we will see what the target was.

Tue, 03/19/2013 - 14:41 | 3348743 EmileLargo
EmileLargo's picture

The Germans don't seem to remember what happened the last time they tangled with the Russians.

Tue, 03/19/2013 - 14:44 | 3348763 earleflorida
earleflorida's picture

haste made waste

Tue, 03/19/2013 - 14:42 | 3348749 1000924014093
1000924014093's picture

"and some additional strategic benefits in the sector" 

If these "benefits" could be defined to include a secure and deep harbor for the new fleet of Russian ships sailing about in the neighborhood and maybe even an airfield, it it would fulfill one of the biggest  and longest held dreams of Kremlin strategists:  A warm water port in the Mediterranean.

Forward !

Tue, 03/19/2013 - 14:43 | 3348751 ekm
ekm's picture

They just got involved WSJ into the chess game.

 

Never, I repeat never will NATO let Cyprus fall into russian hands, unless Obama or Merkel or Cameron have lost their mind, which is possible, though.

Tue, 03/19/2013 - 16:35 | 3349357 Cathartes Aura
Cathartes Aura's picture

do ventriloquist dummies even have minds?

 

*wink*

Tue, 03/19/2013 - 14:43 | 3348757 russwinter
Tue, 03/19/2013 - 15:13 | 3348786 TomGa
TomGa's picture

How about a nice warm deep-water naval port facility as well.

 

BRB, this much fun calls for some more pop-corn and a beer run.

Tue, 03/19/2013 - 14:56 | 3348795 dojufitz
dojufitz's picture

Doe this mean Depardieu gets to open a chain called GERRYS?

Tue, 03/19/2013 - 14:57 | 3348796 MFLTucson
MFLTucson's picture

Out of their fuckin minds getting in bed with Russia.

Tue, 03/19/2013 - 15:07 | 3348855 MsCreant
MsCreant's picture

Scared chicks do weird shit with weird guys all the time for similar reasons. Besides Russia already has set up shop there, this just brings it out in the open and makes it formal, if indeed this is the way it goes down.

Tue, 03/19/2013 - 14:57 | 3348799 l1b3rty
l1b3rty's picture

Downloads of Bitcoin-related apps started rising in Spain over the weekend. For instance, itcoin Gold spiked in the Spanish iPhone Finance category from 498 to 72, while another app called Bitcoin Ticket zoomed from 526-52 in just one day. Leading service, Bitcoin App, jumped from 194 to 151 from Friday and Sunday while Spaniards took notice of Cyprus.

http://silvervigilante.com

Tue, 03/19/2013 - 15:03 | 3348826 diffusing
diffusing's picture

Dont know if anyone here noticed.  but BTC is now on the radar, and FinCEN has stated their views yesterday - http://fincen.gov/statutes_regs/guidance/html/FIN-2013-G001.html

 

enjoy.

 

 

Tue, 03/19/2013 - 15:00 | 3348814 MsCreant
MsCreant's picture

Russians got some great PR. Everyone is scared of them. Just WOW!

Can you imagine anyone scared of Obama? Bush? What a joke. 

If I have to live in a fascist state at least I want my figure head to scare all the other figure heads.

How about this:

"I am the Nightrider. I am the chosen one. The mighty hand of vengeance, sent down to strike the unroadworthy! I'm hotter than a rollin' dice...I'm a fuel injected suicide machine. I am the rocker, I am the roller, I am the out-of-controller!"

Can we at least have one of those?

Tue, 03/19/2013 - 16:55 | 3349466 Cathartes Aura
Cathartes Aura's picture

no worries, I'm sure that the incoming corporate military ruler figurehead will have brass balls dangling to his knees, with weaponry available to cause any mortal to instantly shit themselves. 

all will fall in line at the mere thought of being ruled by this monster.  the rape 'n' pillaging will be legendary!

Tue, 03/19/2013 - 19:02 | 3350107 willwork4food
willwork4food's picture

But will he improve the economy?

Tue, 03/19/2013 - 15:01 | 3348816 gwar5
gwar5's picture

As been said, Russians could 'buy' Cyprus for a paltry sum ($15 Billion bailout?) if they truly have as many rubles in Cyprus ($5 Trillion) as some say.

They get: Banks, Naval bases, Gas reserves and geopolitical clout with MENA and Turkey. Jeepers!

Cyprus could then open their own BitCoin and physical gold exchange on the Island, offering services to continental Europeans and Westerners who want to dump Euro's and USDs.

Cyprus could be the new Switzerland, or Singapore, since the old Switzerland no longer exists. Nobody would fuck with them with the Russian Navy standing guarding. That's how we roll.

Tue, 03/19/2013 - 15:05 | 3348837 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

Or they could put nuclear missiles on the island, and point them at ... well, whoever has nukes over there, and then Putin could go to the UN and bang his shoe on the podium, and, and ... well, all sorts of fun could break out.

Tue, 03/19/2013 - 19:03 | 3350111 willwork4food
willwork4food's picture

Ahh. ..Good times...good times.

Tue, 03/19/2013 - 16:11 | 3349255 Lost Word
Lost Word's picture

The recent Nato war in Libya should indicate that Nato will not allow Cyprus to sell its Natural Gas to Russia.

Tue, 03/19/2013 - 15:02 | 3348821 Joebloinvestor
Joebloinvestor's picture

Russians should just take control and be done with it.

Tue, 03/19/2013 - 15:04 | 3348834 MsCreant
MsCreant's picture

It has to look like Cyprus was rescued if it goes down this way, Russia has to look reluctant. It has to be all "civilized."

Give me a damn break.

Tue, 03/19/2013 - 15:07 | 3348853 Peter K
Peter K's picture

Cypriots should make Bob Pisani the MinFin. Sure he could explain to the Russians about what's going on. :)

Tue, 03/19/2013 - 15:07 | 3348854 Cacete de Ouro
Cacete de Ouro's picture

I don't think the Cypriot Minister of Finance will sleep will tonight. Its like knowing you have to go to the headmaster's office tomorrow morning with the added dread that he might molest you....

"Accompanied by a delegation of businessmen"...hopefully Special Ops and a few ex French Foreign legionnaires dressed as businessmen...

Tue, 03/19/2013 - 15:10 | 3348882 kralizec
kralizec's picture

This truly is getting hilarious.

Tue, 03/19/2013 - 16:04 | 3349225 Arkadaba
Arkadaba's picture

I'm running out of popcorn!

Tue, 03/19/2013 - 15:16 | 3348938 Cacete de Ouro
Cacete de Ouro's picture

- Cypriot delegation cars crash into bollards at high speed on way from Moscow airport. There's been a terrrible accident...

Or - Cypriot delegation treated royally. It all goes well tomorrow afternoon. They all go out to club 911 and get hammered with strippers. Cypriot delegation go back to hotel with strippers who funnily enough aren't drinking. Mysteriously Cypriot delegation all have heart attacks supposedly due to over stimulation.. Strippers untraceable next morning..

Tue, 03/19/2013 - 15:19 | 3348961 Sudden Debt
Sudden Debt's picture

It's a powerplay thing.
It's "hold off to Iran and maybe you'll get your money back"

The money is also putins private money and his loyal friend.
and now those friends look to putin and say: KEEP IT DOWN OR WE'LL LOSE OUR MONEY!!

And Russia will keep calm, get the money and the message is received.

Nd America can go to war and Russia will do shit.

Tue, 03/19/2013 - 15:27 | 3348999 Joe A
Joe A's picture

Long Polonium 210

Gee, giving the Russians a stake in a future Cypriot oil company. Now why didn't they think of that when the negotiations with the Eurozone countries, the ECB and the IMF took place? Why not use the gas and oil reserves as a collatoral for the EU bailout?

Tue, 03/19/2013 - 15:29 | 3349017 Diogenes
Diogenes's picture

So, Russia gets to take over the Cyprus banking system and all their petroleum rights for a lousy 30 billion Euros? Which will end up right back in their own banks?

And once they own the banking system doesn't that give them control of the politicians and everyone and everything else on the island?

Tue, 03/19/2013 - 15:27 | 3349021 halcyon
halcyon's picture

1. Giving potential gas rights to Gazprom = Stupid. Ask Belarus.

2. Giving control of Cyprus banks to Russians = Stupid. Ask anybody who lives in Russia and has to deal with the endless corruption, cronyism, oligarchs and so forth.

There are no good options here.

Just let Cyprus burn and let the money-launderers bear the brunt of the burden.

Would teach everybody a lesson:

1. Government : don't let the banking sector too big, too unregulated

2. Banks : you can always fail. The lender of last resort can decide to go away

3. Voters : Don't vote for fucking corrupt morons or you will suffer yourself

4. Money launderers : you are not safe

5. EU leader : better control of corrupt nations, esp. when they try to join EU.

6. Depositors : choose your bank wisely and do NOT trust your deposit insurance

Just let it fucking burn already.

 

Tue, 03/19/2013 - 15:40 | 3349111 Sandmann
Sandmann's picture

Voters : Don't vote for fucking corrupt morons or you will suffer yourself

Do like the Americans do and vote for honest Congressmen and honest Senators.


Tue, 03/19/2013 - 15:54 | 3349184 halcyon
halcyon's picture

US is a lost cause. System that is just riding on world reserver currency and petro-dollar status.

Otherwise it would already be destroyed by the shadow banking system speculators.

 

Tue, 03/19/2013 - 17:00 | 3349487 Cathartes Aura
Cathartes Aura's picture

all nationstates are fictions, created to occupy minds with loyalty notions, people who want/need an idea of a nest and a parent overlooking their lives while they play. . .

what is happening now, and certainly at other times in "history" - clues.

Tue, 03/19/2013 - 15:28 | 3349031 GOSPLAN HERO
GOSPLAN HERO's picture

Cyprus will get Corzined and be told to like it.

Tue, 03/19/2013 - 15:32 | 3349047 Arthur
Arthur's picture

it will be very interesting to see where this all ends up.

"Russia will be given equity in Cyprus's future national gas company"

Who is Cyprus's nation state partner in the gas fields destined for future development?  Israel.

Can't recall whether an oil company already has locked up the exploaration rights or not. 

 

Tue, 03/19/2013 - 16:14 | 3349268 Arkadaba
Arkadaba's picture

Here is article outlining some of the players in the area: http://www.globalresearch.ca/the-new-mediterranean-oil-and-gas-bonanza/2...

Tue, 03/19/2013 - 15:39 | 3349050 Sandmann
Sandmann's picture

This is an interesting arrangement. in future we can have haircuts by nationality so that American corporate accounts could be raided when London has financing difficulties or simply impose a 30% haircut on US corporates in China. The game is getting really interesting now and has possibilities like say impounding all the accounts of Goldman Sachs inside the EU. Why these idiots think Russian money is all mafia money in Cyprus is bizarre - the major Russian mafia bosses live in Israel and own Israel which is just opposite Cyprus where they do their banking

Semion Mogilevich

http://en.wikipedia.org/wiki/Semion_Mogilevich

http://www.globes.co.il/serveen/globes/docview.asp?did=1000605267&fid=1725

http://www.richardsilverstein.com/2010/12/01/israels-organized-crime-maf...

http://www.sptimes.com/News/071600/Perspective/Russia_takes_underwor.shtml

Tue, 03/19/2013 - 15:50 | 3349161 _ConanTheLibert...
_ConanTheLibertarian_'s picture

Got gaz?

Tue, 03/19/2013 - 16:27 | 3349327 omi
omi's picture

Why all the Russia hate?

When Iceland needed help. Russia gave them emergency assistance, it was sad them trying to justify "renting" an airstrip to the people. Russians were pretty angry.

Why the jokes about Russian economy? Russia has been growing at faster pace than western countries, finances are sound. Almost no debt. You're more likely to be getting money out of Russian banks than out of Western banks, which most of you would say are insolvent in another forum discussion.

Tue, 03/19/2013 - 16:42 | 3349397 stant
stant's picture

nostrovia!! if you have a account we are all russian now!!

Tue, 03/19/2013 - 17:40 | 3349660 Zer0head
Zer0head's picture

When does Turkey make its move?

Tue, 03/19/2013 - 17:56 | 3349771 Wilcat Dafoe
Wilcat Dafoe's picture

Everyone keeps saying "Russian mafia."

 

Why won't anyone say that the "Russian" mafia, at the top inside Russia, and majority of the  upper and mid levels overseas,  is in fact Jewish?  I suspect a lot of this "Russian" money is owned by Jews now living in the UK or Israel, and who were helped in stealing the national wealth of the Russian people by their international fellow tribesman, and useful idiots under Boris "I'll have another" Yeltsin.

eg.

http://open.salon.com/blog/gordon_wagner/2010/02/25/the_global_reach_of_...

http://masterrussian.net/f16/russian-mafia=jewish-mafia-1061/

 

http://www.russiawithoutborders.com/russian-mafia/

The point, dear Thought Police, is that the 'ill-gotten' wealth is largely money stolen from Russians by the oligarchs, and half or more {likely more} were Jews who were assisted by Jews in the UK, US, Romania, and elsewhere.

 

I don't know how to read this, and, no, despite how this sounds, and despite some selected texts from the Talmud, I'm not pointing to an omnipotent, megalomaniacal conspiracy of and by 'the jews' - but there really is something to Jewish media and banking power, really something to there being a Zionist fifth column in countries as off the beaten track as Ukraine and Georgia and New Zealand, and there may well be something to the notion that Israel is, above all, a home base for an international criminal syndicater based on Jewish supremacism/nationalism....

 

But it's not the only such global power.  The Cyprus haircut stuff may involve a clash of "the elites" - that is, fractures in what Alex Jones calls the NWO.....   but when there's this much money involved, Jews are involved, which means Israel is involved, which measns watch our zio-trapped government and the EU's most prominent Israeli 5th columnists all come down to a solution which will uniquely help only 'certain' stake holders.

 

And count on this Iran thing being, really and truly this time, just weeks away.

Tue, 03/19/2013 - 19:29 | 3350210 are we there yet
are we there yet's picture

Russia would happily take a Navel base port in Cyprus as compensation.

Tue, 03/19/2013 - 22:01 | 3350761 Savvy
Savvy's picture

So who cuts the bank opening ribbon Thursday? Mr Weimar, or Mr Potemkin?

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