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Europe, Russia Reject Latest Cyprus Bailout Plan Before It Is Even Voted By Parliament

Tyler Durden's picture


Yesterday, when we described the latest Cyprus bailout proposal being (belatedly) debated by the Cyprus parliament and soon to be voted, we wondered how long before the Troika rejects it outright.  After all the "Solidarity Bailout" Plan C (or whatever it is) did not do what Germany more than anything wanted to accomplish - punish Russian depositors as this entire farce has been nothing but a political gambit dictated by Germany from the onset. And so while GETCO's entire army of algos awaits the flashing red headline with a touch of optimism to unleash robotic buying of ES and EURUSD, we fast forward to the inevitable denouement, which is, not surprisingly, bad news for Cyprus, because as the FT reports, confirming our initial skepticism, "European officials rejected Cyprus’ plans for an alternative package to save its banking sector and remain in the euro, starting a fresh round of talks with the island nation’s government on Friday."

Full details:

The latest plan involved winding up Laiki, the island’s second-largest lender, and split it into a “good” and “bad” bank, with larger deposits over €100,000 folded into the latter. Deposits up to €100,000 would be guaranteed and bank jobs were to be safeguarded. 


But several of its elements – such as raising €2bn by nationalising the state pension fund and issuing bonds based on future revenues from offshore gas deposits – continued to be seen as non-starters by Brussels and Berlin.


“There was some discussion of going back to the original plan of a bank levy, but there are objections from the central bank,” said one person with knowledge of the talks.


The dismissal of the plan comes as time is running out for the island nation to agree on a plan to raise €5.8bn and avert financial collapse before the European Central Bank suspends funding on Monday.


There were already long lines at cash machines in Nicosia on Friday morning and one Cypriot official summed up the sense of desperation saying: “We are waiting for a messiah to come and save us, and of course, there is none”.


Indeed, Angela Merkel, German Chancellor, on Friday told lawmakers that the nationalisation of Cyprus’ pension funds was not acceptable.

Elsewhere, pouring gas on the non-bailout fire, was Russia which Bloomberg reported has crushed all hopes it would swoop in as an alternative white knight, and bailout Cyprus. After all why would it: the worse the situation on the ground, already blamed on Merkel and the Troika, the greater its leverage, and the more power it has to acquire any and all Cypriot assets for free if and when Cyprus is "spun off" from Europe. From Bloomberg:

Russia spurned Cyprus’s offers of assets for a bailout as the island nation’s lawmakers debate legislation to avert a financial collapse.


“I think we are not able to get the support that we wanted to get,” Cypriot Finance Minister Michael Sarris said in an interview after checking out of the Lotte Hotel in downtown Moscow. “But we must go back home because things are getting serious.”


Russia has ended talks with Cyprus and will decide on participating in restructuring debt after the so-called troika overseeing euro-area bailouts, makes its decision, Finance Minister Anton Siluanov told reporters today in Moscow. The troika comprises the EU, ECB and International Monetary Fund.

Bottom line: Europe will not agree to any plan that does not promote "debt sustainability", i.e., impairment of Russian oligarch savings, which in turn is a non-started in Cyprus, and would lead to an immediate trade war with European energy supplier Russia.

That is, in a nutshell, the stalemate as we head into the weekend, and a Monday Cyprus bank holiday, during which the ECB has issued the supreme bluff, and said it would cut off all the funding to the small island.

It is certainly shaping up as a fun weekend.


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Fri, 03/22/2013 - 06:51 | 3361184 Cassandra Syndrome
Cassandra Syndrome's picture

Yet another Eurozone crisis weekender.

Fri, 03/22/2013 - 06:55 | 3361187 GetZeeGold
GetZeeGold's picture



Just write the damn check already Angela.

Fri, 03/22/2013 - 07:00 | 3361199 supermaxedout
supermaxedout's picture

no Bernanke for him its nothing.

Fri, 03/22/2013 - 07:07 | 3361211 Cdad
Cdad's picture

Yeah...that would go over well in the States.  "US bails out Russian Billionaires"  Go ahead...I dare you, Ben.

Fri, 03/22/2013 - 07:15 | 3361229 francis_sawyer
francis_sawyer's picture

That's Plan "P"...

Fri, 03/22/2013 - 07:40 | 3361297 Dr. Richard Head
Dr. Richard Head's picture

Benny has been bailing out European millionaires for the past few years and the sheep are concerned about some broad and her nipple slip on this regurgitated show or that. A few Russian tzars being bailed out will make no difference.

Let them eat horse meat and poo!

Fri, 03/22/2013 - 08:05 | 3361353 Town Crier
Town Crier's picture

Here's video of the latest meeting of the Keynestone Kops.

Fri, 03/22/2013 - 08:19 | 3361369 toys for tits
toys for tits's picture

Someone posted this about Russian governments keeping their money in Cyprus.  Don't know how reliable it is.

Russian Prime Minister Dmitry Medvedev complained Thursday that accounts of Russian government agencies in Cyprus had been blocked as Cypriot Finance Minister Michalis Sarris was set to resume talks in Moscow to secure aid.

In comments released early Thursday, Medvedev warned that Russia would take a “firm” stand on Cyprus because the accounts of governmment structures had been blocked on the island.

Fri, 03/22/2013 - 07:18 | 3361237 sunnydays
sunnydays's picture

Once Cyprus is willing to give Russia everything, then Russia will come in and save the day.   But the gas fields are shared by Turkey and so there is no just giving the future production of that to them. 

Fri, 03/22/2013 - 09:58 | 3361547 JOYFUL
JOYFUL's picture

Based upon the fact that internet banking has been out of order for 5 days now here, I decided to have it out with them this morning...

I'm pulled over on the side of the road, and going to do some thinking out the hopes that there's some kind of banking analyst\IT type dood out there who can help me put the pieces together of what the puzzle is presenting:

once again...everything is functioning normally inside the bank...the system problem from Tuesday appears to be over. But I now believe this is "Ptotemkin Village 20.0"'s what support told me on the in branch phone(help line not answering outside calls!)

"we're experiencing techncal problems, it may be Sunday or Monday before we can give you back service." Is everyone having this problem?"no, the foreign customers of the bank are."Let me see if I understand you...Turkish citizen customers can log in OK but foreign customers system but different results."Yes, that appears to be the situation, but they are not telling us any more."

Ok. Since I was in branch, I had my chum who works there give a shot at recreating my password for on line was clear that everyone thought that I was nuts at this point = couldn't be the system!...15 minutes of screwing around later, it turned out it wasn't my error...

so I had him get on the phone again with c.s. and we learned the following: some foreign customers can log in, but not most, and some Turk customers are also stranded...very interesting...have a nice day!

Here's where I'd like some feedback...the fact that this situation began and is running parallel to the developing disaster in Cyprus...the fact that this is being micro-managed to induce the max sheeple-ness...on the part of customers and bank people...nothing to see here...or must be just me! The fact that folks like myself who don't keep fiat in banks and only use it for the XAU accounts they offer...are more than likely foreigners with a more advanced sense of what's goin down than the locals...who still do physical (another friend of mine in a bank here was complaining what a tough sell the XAU account is to Turks!) almost exclusively..the fact that the Russians are the new crew in the expat department here...the Brits are running for cover...the fact that my bank is half owned by a very large European zombie bank that(like most) may be way more exposed to this crisis than the containment squad wishes anyone to believe...


the fact that as the above commentator, and myself, have pointed out previously, that the Turks and the Ruskies are the only players on the off shore Cyprus fields that matter now(cept for tel aviv!)and the fact that nothing is going to go down now without Putins' say so. I'm less concerned about this as a personal bank crisis than as a very bad sign of something brewing underwraps. Luv to hear the brain trust speak up on this...what about punters in other places with European bank exposure subsidiaries... like, hey SDT Charlie in Bulgaria etc....what's goin on there doods? Somethings up.

Fri, 03/22/2013 - 07:20 | 3361244 Urban Redneck
Urban Redneck's picture

The Russians could use another naval base in the Med right now as a hedge... A Russian military base on EU soil (and the slap in the face to NATO and Brussels control of FP) would go down even worse than the US bailout of Cypress, But then again the US sales job would fall to bozo-the -clown who great difficulty speaking intelligently about such matters...

Fri, 03/22/2013 - 07:34 | 3361278 Lebensphilosoph
Lebensphilosoph's picture

Hedge? The Russian navy today consists of a bunch of rusting tins cans.

Fri, 03/22/2013 - 07:43 | 3361308 knukles
knukles's picture

While the EU member states navies....

Fri, 03/22/2013 - 07:51 | 3361326 Urban Redneck
Urban Redneck's picture

In the event that the lease on Tartus is "revoked" by new regime or to minimize the current incentive of the EU to oppose Assad's regime thereby putting their plum strategic parking spot for their rusting tin cans at risk.

Fri, 03/22/2013 - 08:36 | 3361419 fudge
fudge's picture

Does Titanium rust ?



Fri, 03/22/2013 - 09:23 | 3361579 thisandthat
thisandthat's picture

Rusting tin cans that can fire supersonic torpedoes...

Fri, 03/22/2013 - 07:23 | 3361251 NoDebt
NoDebt's picture

Did you just DARE Uncle Ben to do something stupid? 

Ugh.  Have you learned nothing?

Fri, 03/22/2013 - 08:23 | 3361376 de3de8
de3de8's picture

The problem is most don't know and the rest don't care.

Fri, 03/22/2013 - 07:15 | 3361230 knukles
knukles's picture

Oh the irony of it all

Europe to Russia. Can you help us, we're broke
Russia. Go fuck yourself
Eu. Listen Mr SmArtypants it's your secret billions going to be taxed
R. You touch my Money and you'll freeze in the dark this winter
E. Dare you
R. Get the fuck outa here
E. We'll get mad, damnit
R. LOL. Watch
R2. Watch what?
R. They're gonna get mad
Laughter all around
EU diplomats crying

So this is the way the Cold War ends. No military power, no diplomatic credibility and yer ass gets treated no different than a third world African Ebola farmer
Correction, dumb ass Ebola farmer

Talk about stepping on your own dick

Say, we were talking about credibility and...

Fri, 03/22/2013 - 07:31 | 3361268 GetZeeGold
GetZeeGold's picture



Sure to trigger one hell of a temper tantrum in Euroland today.

Fri, 03/22/2013 - 07:33 | 3361277 negative rates
negative rates's picture

.....oops, lights out.

Fri, 03/22/2013 - 07:46 | 3361316 spankfish
spankfish's picture

There is this... granted from February.

If any Russians evaded tax by bringing money here - and he says he is convinced his clients do not - it is an issue for Russia, he says, rather than for Cyprus or for Germany, whose taxpayers will have to pay for the bulk of any EU bailout.

At any rate, most of the Russians buying properties here are middle-class, he says, with a budget of between 250,000-500,000 euros, rather than wealthy oligarchs.

"So what money-laundering are we talking about? Of 300,000 euros?" the fresh-faced entrepreneur says with a laugh. "If they want to go after the rich Russians - go to London or Germany."

London in particular is a favored destination for Russia's super-rich, seeking homes worth tens of millions of dollars.

Fri, 03/22/2013 - 08:47 | 3361452 new game
new game's picture

for what it is worth, i think boris is welcome and well received by the people.

imo russia has the upper hand, being both welcome and money

what does the eu(germany)offer; more debt and sevitude to a master that has indicated that they will take your property.

we know what the outcome should be, but by monday we will know if the will of the people has any clout any more...

Fri, 03/22/2013 - 09:29 | 3361594 BorisTheBlade
BorisTheBlade's picture

Correct, all those really having real big money didn't keep it in Cyprus: London, Luxembourg, Switzerland, those destinations were preferred ones. Cyprus was a refuge for middle class seeking transparent and stable jurisdiction to park their moneys. Irony is that they got in Cyprus what they were running from back home: expropriation of capital and disregard for the rule of law. EU in that sense shot itself in a foot as Putin proclaimed de-offshorization of Russian economy and seizing funds from Russian middle class would only make his case strong: "See, those bureacrats in Brussels are really not that different from ours, except you cannot influence them at all and not only they will seize your funds, they will also call you a mobster and a dirty Russky money launderer. Keep your money home comrades".

Fri, 03/22/2013 - 07:26 | 3361259 DirkDiggler11
DirkDiggler11's picture

The markets are going to get ugly this afternoon heading into the weekend.

EMERGENCY : Plunge Protection Team to your trading desks !!!
Uncle Ben needs YOU to stop this market crash !!!

Department of Propaganda - Call CNBS and Bloomburgstein, have them run March Madness stories and have Becky Quickie interview the 4 people lined up to buy the new Blackberry.

Fri, 03/22/2013 - 07:39 | 3361281 knukles
knukles's picture

Cassandra... It's either that or a weekend of Three Stooges shorts
(Hmmmm. The Stooges are funnier and more intelligent come to think about it...)

Mrs K. Honey, WTF are you watching?
K. The Three Stooges
Mrs K. Don't you have anything better to do, that is so fucking dumb
K. It's educational
Mrs K. What! (Yelled BTW)
K. The EU told me so
Mrs K. Honey, go golfing, please.... Just go...

Fri, 03/22/2013 - 13:47 | 3362895 Buck Johnson
Buck Johnson's picture

Yep, another crazy weekend.  The funny thing is that Cyprus truly can't do the cuts and not because they feel for their people.  It's because if they allow a tax on the above (or even below) 100,000 euro depositors who most use it as an offshore haven, then they would never be able to get individuals to come back to little Cyprus to ever invest in their country.  They would be a little burg with 1.1 million people with only fishing and possible cheap tourism.

Fri, 03/22/2013 - 06:56 | 3361190 Cursive
Cursive's picture

I wouldn't describe this round of talks as "fresh."  No, just more of the same vapid bullshit as we circle the drain.

Fri, 03/22/2013 - 07:40 | 3361294 disabledvet
disabledvet's picture

yep. "test run for the total break up of the euro zone." didn't take long for the car bombs to go off over Iraq after this minor kerfuffle. Imagine what the sudden return of the d-mark will mean...

Fri, 03/22/2013 - 06:57 | 3361192 schatzi
schatzi's picture

"the more power it has to acquire any and all Cypriot assets for free if and when Cyprus is "spun off" from Europe."

What assets? The pension funds? The bankrupt banks? Or the gas fields that expand deep into Turkish territory. The same Turkey that doesn't even officially recognise Cyprus.

Fri, 03/22/2013 - 07:49 | 3361322 smacker
smacker's picture


The picture you paint is one of Nato going to war with itself (Turkey & the EU majors are Nato members).

Looks like fun and it might, just might, keep Western political filth occupied.

Fri, 03/22/2013 - 08:51 | 3361464 new game
new game's picture

what they have everybody wants-beaches and bitchezzz

Fri, 03/22/2013 - 06:59 | 3361195 Debugas
Debugas's picture

Cyprus should declare default and trigger CDSs. That would send the troika a message

Fri, 03/22/2013 - 07:03 | 3361201 Temporalist
Temporalist's picture

They will be "liberated" before that ever happened.  Those nasty terrorist citizens are evil and dangerous.  Just imagine the horror if they had guns.  Just one more example of the peril the world is in when the masses are not controlled enough by smarter people in government.

Fri, 03/22/2013 - 07:23 | 3361205 GetZeeGold
GetZeeGold's picture



Nuking NYC wouldn't trigger a CDS default.....that crap was never intended to payoff.


There I said deal with it.

Fri, 03/22/2013 - 08:56 | 3361486 SMG
SMG's picture

The Oligarchs will trigger the CDS's when they're ready to crash the world economy and bring in the global government.   6 months to 2 years from now is my best guess.  Hope they get stopped.

Fri, 03/22/2013 - 07:36 | 3361284 Silver Garbage Man
Silver Garbage Man's picture

I wouldn't want to be "the guy" who pulls that trigger. It could be "dangerous".

Fri, 03/22/2013 - 07:37 | 3361287 negative rates
negative rates's picture

Those triggered CDS would probably first lead to a lack of cash on a said island to judge their reaction. So if you see anything you like, pull the trigger.

Fri, 03/22/2013 - 07:03 | 3361202 MrNude
MrNude's picture

Cyprus paging Helicopter Ben, please bail us out, Cyprus to Helicopter Ben over and out. 

Fri, 03/22/2013 - 07:13 | 3361223 Temporalist
Temporalist's picture

Ben reminds me of the Little Dutch Boy.  He's plugged his finger in so many dikes (not dykes) that he's surely going to run out of options soon - and I'm sure Cyprus would have already collapsed if not for the $15 trillion hole-plugging bailout of Euro just a couple of years back.  Paper doesn't work for very long at plugging the cracks in the dam.

Fri, 03/22/2013 - 07:31 | 3361258 knukles
knukles's picture

Wait.... Ya got Nippleatano, Hillbillary, her lezbo sweetie and who the hell else I dunno...
But like cockroaches, one is never enough

Strapons all around, girls!

Fri, 03/22/2013 - 07:34 | 3361276 Temporalist
Temporalist's picture

I hope WB7 makes a Little Dutch Ben image

Fri, 03/22/2013 - 07:40 | 3361299 negative rates
negative rates's picture


Fri, 03/22/2013 - 07:44 | 3361311 knukles
knukles's picture

Fingers in the Dykes

Fri, 03/22/2013 - 08:12 | 3361362 GetZeeGold
GetZeeGold's picture



Bitchez with billions of bullets......and bad attitudes.

Fri, 03/22/2013 - 08:57 | 3361490 knukles
knukles's picture

And 12 times a year, things go irrational......

Fri, 03/22/2013 - 07:40 | 3361296 negative rates
negative rates's picture

Ben has the,  white house hot phone line, on speed dial to Mr. Jones there, not the painter man. 

Fri, 03/22/2013 - 07:36 | 3361286 ziggy59
ziggy59's picture

Paging Cyprus... That would help Putin, and we had deals that were offered to him and that he decided not to play by our rules, and its called currency wars for a reason
Ben out!

Fri, 03/22/2013 - 07:13 | 3361204 Sudden Debt
Sudden Debt's picture

it's just good parenting!

When I tell my kids to clean up their room...
they sometimes start saying:
My kids know all to well that at home... it's not a democracy.
unless my wife says otherwise :)
The king needs to sleep in his bed so....

Fri, 03/22/2013 - 07:32 | 3361273 ziggy59
ziggy59's picture

Yes, as Mel Brooks so greatly stated, "its good to be king!"

Fri, 03/22/2013 - 07:40 | 3361298 Peter Pan
Peter Pan's picture

I agree with good parenting and while it is needed in the case of the PIIGS, one wonders why the worst child of the lot (the USA) is not subjected to any good parenting.

The world will continue to stagger for as long as it solutions are erratic, uneven, ill considered and full of politics rather than leadership.


Fri, 03/22/2013 - 08:26 | 3361389 Awakened Sheeple
Awakened Sheeple's picture

America is the drunken step-father.

Fri, 03/22/2013 - 09:00 | 3361503 new game
new game's picture

america has turned into a cash strapped, debt laden bully that is about have the rug ripped out from under.

the dollar back oil stranglehold will be the turning point. Instant poverty and fighting for a lifestyle that will instantly be  unsustainable.

the dollar will die with millions americans in dire straights - the shaloms legacy...

Fri, 03/22/2013 - 07:43 | 3361307 disabledvet
disabledvet's picture

how about when you tell them to go to hell though?

Fri, 03/22/2013 - 07:50 | 3361324 Onehunglo
Onehunglo's picture

The french lady will declare "let them smoke dope" before she is also DSK'd.

Fri, 03/22/2013 - 07:12 | 3361218 falak pema
falak pema's picture

who says it would start a trade war?....

Has Putin said it in those terms? All Russia has said is : we will sell our Euros! 

This is indeed news!

Fri, 03/22/2013 - 07:14 | 3361225 Sudden Debt
Sudden Debt's picture

sell them to who?

Fri, 03/22/2013 - 07:22 | 3361238 knukles
knukles's picture

Cyprus, silly
They'll use the equity in the bankrupt closed banks as collateral

See, Ponzis all fixed again

Fri, 03/22/2013 - 07:29 | 3361262 falak pema
falak pema's picture

the fact is there is a market for Euros as for Usd as for sovereign bonds in Eurozone.

Huge Fx and bond markets.

So that's just funny but thats not funny money! 

Fri, 03/22/2013 - 07:38 | 3361291 Ghordius
Ghordius's picture

hey, it's a wonderful moment for Russians to get a bit of kudos back after all those years of national humiliations

I particularly like the "you are behaving like the Soviet Union" paroles

Indeed Russia speaks about the elephant in the room: FX reserves - but I don't see them dumping that part in EUR that soon, after all they would have to think hard about substitution - and this little thing is a bitch, even with the trillions of USD we have all accumulated, worldwide

psst... falak... have a short look at a little hint I've put here 3361263

Fri, 03/22/2013 - 07:42 | 3361304 GetZeeGold
GetZeeGold's picture



I particularly like the "you are behaving like the Soviet Union" paroles


Well...they kinda are. Just sayin.

Fri, 03/22/2013 - 07:46 | 3361317 Ghordius
Ghordius's picture

I knew the Soviet Union very well - you had to see it to believe it. what we are witnessing is not that "nice", but it's nothing compared to that

and yet I am very, very happy for Russians being able to critizize us, for once, even if it's way off the mark

Fri, 03/22/2013 - 08:36 | 3361418 Debugas
Debugas's picture

actually soviet union did not confiscate people's deposits - it simply inflated it out to worthlessness

Fri, 03/22/2013 - 07:58 | 3361339 falak pema
falak pema's picture

russian reality under Putin is not USSR! Its more like Czarist russia.

Remember that RR made it an express part of his strategy to IMPOSE on Saud the OPEN TAP max oil production meme in 1982. It had two positives : 1° It destroyed the Soviet oil pump revenue leading to Berlin wall down. 2° It allowed FIRE asset ramping economy to take off as cheap energy meant world wide growth; hello big bang! 

So yes, Putin must be gnashing his teeth for this small mishap in Cyprus all the while hard cash rolls in from commodities.

They say that the Putin Oligarchy is 20 people who control all the commodity plays of Russia. That compares well with the 20 giant trading corporations of the west who control THEIR oligarchy hold on markets, like Glencore, Koch n Kargill and Vitol...the last I believe has two heads, one western the other Russian...

We are in a vertical world and fiat is still king... so Russia has to play along as lead non western Oligarch along with the Saud and Qatar clans.

Fri, 03/22/2013 - 07:53 | 3361331 NoClueSneaker
NoClueSneaker's picture

... to Robert Mugabe, of course ...

Fri, 03/22/2013 - 07:13 | 3361222 valley chick
valley chick's picture

the ECB has issued the supreme bluff, and said it would cut off all the funding to the small island.

Please do....get this crap rolling....

Fri, 03/22/2013 - 07:42 | 3361305 Ghordius
Ghordius's picture

it's an interesting twist, and if it's not a bluff (unlikely) then it means that the governor of the Cypriot central bank has indeed quite enraged two thirds of his ECB collegues - I suspect by drawing ELA funds in a way the others don't deem right

funny I don't see lots of jokes about the chap, even though his first name is Panicos

Fri, 03/22/2013 - 07:14 | 3361226 _ConanTheLibert...
_ConanTheLibertarian_'s picture

Oh shit...

Fri, 03/22/2013 - 07:18 | 3361235 Two dogs
Two dogs's picture

Back to plan A then.  What a surprise . . . and a waste of time.

Fri, 03/22/2013 - 07:20 | 3361243 knukles
knukles's picture

Bunch a fucking incompetents
These guys are Paul Krugman in power

There should be a law....

Fri, 03/22/2013 - 07:30 | 3361264 ziggy59
ziggy59's picture

Great! Now hes going to enter the picture
Remember, He doesnt want any ad

Fri, 03/22/2013 - 09:01 | 3361498 knukles
knukles's picture

Me and my big mouth....
He is so bloody insecure that he come here just for attention.  Jesus!
Reminds me of newcomers still living lies about themselves, uncomfortable in their own skins and not knowing who they are... cast out by the rest of society for being so self centered, immature and irresponsible.

Fri, 03/22/2013 - 07:31 | 3361271 morning
morning's picture

Plan Athens, you said?

Fri, 03/22/2013 - 07:22 | 3361247 krispkritter
krispkritter's picture

Why can't we all just get a bong?

Seriously, these idiots need to pack into a room, pass a bowl, and work this out with a bunch of the more well-informed populace on hand to keep things on the the heave ho to the Euro might be a good start.

Fri, 03/22/2013 - 07:22 | 3361248 morning
morning's picture

Leaked to the portuguese media :the portuguese constitutional court will reject the budget, likely to result in a 2B shortfall and govt demise.

Under the radar but I fail to see why.

Fri, 03/22/2013 - 07:26 | 3361255 shinobi-7
shinobi-7's picture

Zero Hedge is becoming to the current financial crisis what CNN was to the Gulf War, I can't get enough of it!


Fri, 03/22/2013 - 07:37 | 3361289 smacker
smacker's picture



When other commenters post a compliment about Zerohedge I find myself also giving an up-tick.

ZH coverage of the Cyprus crises and very many other important issues is superb and deserving of much praise.

Well done to ZH...keep it up ...and p-l-e-a-s-e watch yer backs!


Fri, 03/22/2013 - 07:49 | 3361321 disabledvet
disabledvet's picture

what other coverage? CNN had their weatherman doing the Fukushima nuclear meltdown. What's next? the E network talking about the beautiful people of the ECB?

Fri, 03/22/2013 - 07:45 | 3361312 Silver Garbage Man
Silver Garbage Man's picture

Without the spin and LIES.

Fri, 03/22/2013 - 08:23 | 3361377 Jacque Itch
Jacque Itch's picture

Perfect analysis.  Every time I hear how our econ is like a junkie needing it's next fix from Ben I just relate it to my addiction to ZH.  An awesome buzz!!!

Fri, 03/22/2013 - 07:30 | 3361265 DrDinkus
DrDinkus's picture

this BIS buying of the EURUSD makes sense...

Fri, 03/22/2013 - 07:35 | 3361280 morning
morning's picture

For a quick 50 pip?

Fri, 03/22/2013 - 07:42 | 3361306 DrDinkus
DrDinkus's picture


Fri, 03/22/2013 - 07:31 | 3361272 lakecity55
lakecity55's picture

Russia vs. The Red Shield

Tonight, live on HBO Friday Night Fight!

Fri, 03/22/2013 - 07:35 | 3361283 Peter Pan
Peter Pan's picture

Cypriots are about to meet a reality that is harsh. Their lifestyles were for too long premises upon wealthy Russians et al, inflating their economy and real estate values without any real growth in the productive part of the economy.

It is sad, but Cyprus along with the others bordering the Meditteranean will have to learn how to plant their own vines if they want the return of the punch bowl.

Fri, 03/22/2013 - 08:06 | 3361356 smacker
smacker's picture


But the big issue that's always on my mind is to what extent are the population of any country expected to be experts in national economics? ...and to understand that rising domestic property prices pushed up by imported foreign money is not equal to growth in real wealth from making things and exporting, or even from tourism?

In this world where governments, when elected, assume total power of anything that moves, there is strong pressure on citizens to accept (if not always fully believe) what their political elites tell them. When the same government spends ever more money on this/that, it adds to the message being sent.

Bluntly, the crises is a consequence of the democratic system we operate, where, to get elected, political elites offer ever more largesse to voters.

Fri, 03/22/2013 - 08:14 | 3361364 Temporalist
Temporalist's picture

People are experts in one thing and that is knowing when they are starving, poor, homeless, being robbed, can't afford anything; they don't need to be experts in anything else.


Even people receiving handouts, welfare, foodstamps (bread lines) don't tolerate it forever if that is all they have.

Fri, 03/22/2013 - 08:16 | 3361365 Ghordius
Ghordius's picture

"where governments, when elected, assume total power of anything that moves"

ah well, democracy the worst political system - and all the others are way worse

nevertheless I have to note that the freshly elected Cypriot President, the Cypriot FinMin and the Cypriot national bank governor came back to Nicosia with the deal (or indecent proposal) they concocted in Brussels with all their collegues and presented it to the representatives of the sovereign Cypriot people, the Cypriot parliament

of course The Sovereign People have the same problem of autocratic Kings of old: they have to be able to understand WTF their ministers and servants are telling them

but this is a question of education and interest. and political activism. consumers ain't citizens

Fri, 03/22/2013 - 09:29 | 3361600 smacker
smacker's picture

"democracy the worst political system - and all the others are way worse"


I've never bought into this claim even though it was made by Churchill. IMHO, no system is perfect, but the best system is democracy within the framework of a strong Constitution which clearly articulates the powers of an elected government. Meaning, if it ain't on the list, it's none of their business. Of course, such a system requires a mechanism of independent oversight with strong penalties for abuse. The lack of the latter is why sucessive American governments have run roughshod over their constitution.

Fri, 03/22/2013 - 07:39 | 3361293 kieran1968
kieran1968's picture

Is it possible that the creditors to these insolvent banks demand immediate repayment of outstanding mortages/loans secured on properties?


Not so bad if you have a 90% mortgage, but if got say 30K to go on a 250k you could find you have to refinance or lose the property.


All bets are off now. This could be the biggest property heist in history!

Fri, 03/22/2013 - 07:41 | 3361300 ziggy59
ziggy59's picture

So, gold is down? dollar down? Dow futures up?


I know, i know i know...

Its friday and icecream has no bones

Fri, 03/22/2013 - 08:35 | 3361416 ziggy59
ziggy59's picture

Gold down 10 bux on spot, silver down 40 ??

It would be funny if it wasnt really scary that everything is friggin broken..


Fri, 03/22/2013 - 07:41 | 3361301 Zgangsta
Zgangsta's picture

The lesson of Cyprus should stand as a stark reminder to all countries:  always make sure to become too big to fail.

Fri, 03/22/2013 - 07:41 | 3361302 Exile on Mainstreet
Exile on Mainstreet's picture

Day 2 to march madness is what really matters today.
Now get back to work, all of you.

Fri, 03/22/2013 - 07:51 | 3361313 Archetype
Archetype's picture

Brittish clearer said to be behind the latest ramp in EURUSD. The reason is said to be in case of lack of liquidity after the weekend. So this is actually a fear trade but stocks are soaring. Or am I getting this wrong?

Fri, 03/22/2013 - 07:45 | 3361314 sharky2003
sharky2003's picture

If I've learned anything from watching these morons over the past few years, there'll be some BS 11th hour deal and all will be well again. The EU is just jawboning that they aren't going to save the day again, but I think given the other option of contageon, they'll have no other choice when it comes down to it.

Fri, 03/22/2013 - 07:49 | 3361320 ekm
ekm's picture

I still stand by my interpretation of the situation.

The westerners want to crash the system and finally, finally found Russia to blame for it.


I'm seeing the media using the word "russians" a lot more often now.

Fri, 03/22/2013 - 10:41 | 3361986 _ConanTheLibert...
_ConanTheLibertarian_'s picture

Well, you predicted a collapse. Was this what you had in mind?

Fri, 03/22/2013 - 07:54 | 3361328 Son of Loki
Son of Loki's picture

Why not tax EU CEO bonuses and salaries say over 1 million euros. Simply tax anything over that 10%. That sounds "fair" also.

Fri, 03/22/2013 - 07:57 | 3361335 Ghordius
Ghordius's picture

indeed there is a trend towards that, in the EU - note the Bonus Cap law for bankers that got the British establishment so enraged

Fri, 03/22/2013 - 08:13 | 3361363 smacker
smacker's picture

I've never believed that taxing bonuses works effectively. It simply creates a whole new tax-avoidance industry and more non-productive jobs.

IMHO, a better idea is to ensure that whatever regulatory oversight rules are necessary in any sector, they should be enforced without fear or favour. And of course this must apply to banksters too. Anybody who breaks the rules should be left in no doubt that they will brought to book. If this had happened in the banking sector, we would not be where we are today. But of course we all know that it suited the political filth to turn a blind eye to what was going on.



Fri, 03/22/2013 - 07:57 | 3361340 ZippyBananaPants
ZippyBananaPants's picture

Rut ro

Fri, 03/22/2013 - 07:58 | 3361341 lailapa
lailapa's picture

GREECE and Cyprus ranks among the witches of Salem

Germans plunge Europe into a new Medieval Era.


Fri, 03/22/2013 - 07:58 | 3361343 NoWayJose
NoWayJose's picture

Cyprus needs to 'reject' both the EU and Russians. But this is Europe and that means there will be another 'kick the can down the road' solution.

Fri, 03/22/2013 - 08:04 | 3361351 magpie
magpie's picture

Breaking news...Cypress joins Shekelzone

Fri, 03/22/2013 - 08:05 | 3361354 spankfish
spankfish's picture

Im thinking blue water fleet off the coast of Cyprus... flying the St. Andrew flag or whatever the Russian Navy Ensign is these days.  Cyprus is ripe for the taking.

Fri, 03/22/2013 - 08:40 | 3361426 Temporalist
Temporalist's picture

Speaking of Russia (found on


Russian Leader Warns, “Get All Money Out Of Western Banks Now!”

"A Ministry of Foreign Affairs (MFA) “urgent bulletin” being sent to Embassies around the world today is advising both Russian citizens and companies to begin divesting their assets from Western banking and financial institutions “immediately” as Kremlin fears grow that both the European Union and United States are preparing for the largest theft of private wealth in modern history.

According to this “urgent bulletin,” this warning is being made at the behest of Prime Minister Medvedev who earlier today warned against the Western banking systems actions against EU Member Cyprus by stating:

“All possible mistakes that could be made have been made by them, the measure that was proposed is of a confiscation nature, and unprecedented in its character. I can’t compare it with anything but … decisions made by Soviet authorities … when they didn’t think much about the savings of their population. But we are living in the 21st century, under market economic conditions. Everybody has been insisting that ownership rights should be respected.”

Medvedev’s statements echo those of President Putin who, likewise, warned about the EU’s unprecedented private asset grab in Cyprus calling it “unjust, unprofessional, and dangerous.”"

Fri, 03/22/2013 - 08:29 | 3361397 Whoa Dammit
Whoa Dammit's picture

If the EU was unhappy with the fact that Cyprus has a lot of what they term "Russian Hot Money", why were they allowed to join the EU in the first place ? Oh, I get it, that money was fine if it could be used to the EU's advantage, and is only a problem now that it cannot. 

Fri, 03/22/2013 - 08:40 | 3361429 jubber
jubber's picture

Silvber and Gold getting killed on this great news

Fri, 03/22/2013 - 08:41 | 3361434 Temporalist
Temporalist's picture

If it wasn't so comical and farcical it would be sad.

Fri, 03/22/2013 - 08:41 | 3361432 MorningStar
MorningStar's picture

Well, if EU has a plan to steal people's life savings then what else do they have in store for the people?  What other scams will they use to steal money to save their banking friends?  It's getting scary out there!

Fri, 03/22/2013 - 08:42 | 3361436 MyBrothersKeeper
MyBrothersKeeper's picture

Why are the Cypriot people to blame for:

1) Russian mobsters/elite?

2) Greek spending?

3) Lack of unity in Eurozone?

This poor little place was forced to buy Greek bonds. Is not respobsible for criminal activity in Russis. And has little say in the workings of the Eurozone.

It's not like they are giving immunity to law breaking Russians.  Here's an idea: Russia arrest and prosecute it's own criminals and change it's tax law to prevent tax havens elsewhere.  The Eurocrats want the Russians to pay? Earth to're financial problems have evrything to do with your Socialistic, uncompetitive state of affairs that has overpromised and killed the private sector (currently being waged in one nation under God as well) and virtually nothing to do with tax havens etc. Any country that is smart will default and it will be better than completely giving up your soverignty to a group banker/political sociopaths.  The bondholders will realize sooner or later that a haircut is coming...a big one, so why not take it now in a more orderly fashion.  Waiting is only going to make the cds/deriviative exposure more painful.  Either way, what Cyrpus is experiencing is the type of thing we'd see in US with the way the SEC deals with banks or the NCAA hands out punishment: Miami's/Kentucky etc violations were so bad we had to give the death penalty to Elon College (or insert any tiny school here).

Fri, 03/22/2013 - 08:49 | 3361459 Byte Me
Byte Me's picture

So basicaly....,

There's no agreement

No Bailout/in

Can't raise against contentious assets (Ngas, pension funds)

Cy won't agree to punitive terms from the Troika (trans. Berlin)

Rus won't pony up to bail Bankstas who dealt with their own Gangstas.

Doucheland won't ante up bc the Gangstas run off w the bailout at end of Bank "holiday"...

No-one else will touch this hot potato (read:- bail the Gangstas)



Cyprus will have to declare bankruptcy, cram down the banks affected, with the mob taking a MUCH bigger hit than 9.9%, almost immediate contagion into Greece at a minimum.

Cyprus probably leaves the Eurozone, dealing it a potentially mortal blow as the first exitee.

Russia gets nothing (other than plenty angry)

The 'Troika' is remembered historically for being a collection of incompetent faceless technocrats that couldn't agree on exit procedure for escapes from wet paper bags.

Systemic bank crisis ensues.

Fri, 03/22/2013 - 08:51 | 3361465 Fix It Again Timmy
Fix It Again Timmy's picture

I dare say this money shit/thing has gotten quite out of hand; actually it's very simple, either you have the money or you don't.  What's so hard about that?...

Fri, 03/22/2013 - 08:52 | 3361469 eclectic syncretist
eclectic syncretist's picture

Sonofabitch Bernanke you dumbfuck shit-for-brains dickhead asshole.  You're beating down silver on the day everyone who knows what's going on will be wondering about debt contagion!  Well done, and thanks for the buying opportunity, you fuckface jackass knobjobbin sociopath.

Fri, 03/22/2013 - 09:13 | 3361525 matrix2012
matrix2012's picture


EU Plays Misdirection Game While Planning Cyprus Gold Confiscation

March 21, 2013


The Cyprus bailout proposal made by the Eurogroup is both economically and politically absurd. But what if the real reason behind the whole Cyprus crisis is the desire to confiscate the country’s gold?

The European Union, the IMF and the ECB are pushing Cyprus into bankruptcy while risking a contagion effect that could lead to the meltdown of the eurozone. European leaders have already bailed out Greece, Portugal, Spain and Italy. Why is the Cyprus bailout so special? Why do the European leaders prefer to push the country into bankruptcy and raid the Cypriot bank accounts instead of saving it?

There are several possible reasons for such a behavior. Either the leaders of the Troika have made a mistake with terrible consequences or they have a plan which is not obvious to outside observers. If the bailout package, combined with a “solidarity levy” on the bank accounts is a bona fide mistake, why aren’t they willing to correct it? The European negotiators insist that Cyprus must provide 5.86 billion euros, knowing that the Cypriot government doesn’t have the money. So far, it looks like the Troika acts within a well established plan. What are they trying to achieve?

Let’s take a look at the gold market. It has been known for several years, that the central banks of the developed world are operating a huge price suppression scheme in the gold and silver markets. The mainstream media is ignoring this fact, but several whistleblowers, like the former Goldman Sachs trader Andrew Maguire, have come up with facts and figures, supporting the hypothesis of a wide conspiracy to suppress the prices of gold and silver. For several years, well known traders and investors like Eric Sprott and John Sinclair have been trying to draw the press’ attention to this problem. According to the latest calculations made by Eric Sprott, it is likely that the US Federal Reserve has almost no physical gold available, so its ability to continue suppressing the gold prices is diminished. If this is true, the Cyprus crisis is a boon to the market manipulators.

. . .


And from Russia 24, the Russian state news channel:

"The gold reserves of Cyprus stand at 13.9 tons. While not a big amount in itself, these reserves represent “physical gold” not “paper gold” which makes it very valuable from a market manipulation perspective. If the central banks and financial institutions that are suppressing the gold prices are running short on “physical gold”, then each ounce of real, assailed, not rehypothecated gold is priceless. Time has shown that the gold market manipulators are extremely powerful and will go to any lengths to keep the gold and silver prices down. If they have to force a country into bankruptcy in order to get 13.9 tons of physical gold and use it to suppress the prices, they’ll do it. If they have to create a distraction for the media, like a “special levy on bank accounts”, they’ll do it. If they are successful, it is very likely that Italian or Spanish gold reserves will be targeted next."


It's rather strange to spot no the slightest hint at ZH linking this Cyprus saga with the possibility of its gold confiscation by the Overlords!!


Fri, 03/22/2013 - 10:51 | 3362040 falak pema
falak pema's picture

facts are facts and conjecture stays conjecture.

Nobody is pushing Cyprus into bankruptcy.

Cyprus IS BANKRUPT; both government and the two banks. Period.

Fri, 03/22/2013 - 11:04 | 3362108 malek
malek's picture

Your last sentence is true for a lot of countries.

So why is this only happening to Cyprus now?

Fri, 03/22/2013 - 11:51 | 3362339 WallowaMountainMan
WallowaMountainMan's picture

for the same reason it happened to the others in the sequence of the other ecb deals. their time had run out and they needed the euros.

a quote from the zh post:

“There was some discussion of going back to the original plan of a bank levy, but there are objections from the central bank,” said one person with knowledge of the talks.

the original offer from the ecb was 0% under 100k, 15% from the over 100k. the pres of cyp demanded and the ecb eventually said yes to his proposal to shave the 15%  to under 10% and the balance from the under 100k crowd. (why would the pres of cyp do that? tax the poorer in favor of the richer? i say/have said cronism/big donors). when the pres of cyp could not get his proposal through (big big error and the trigger for the 'rest of the story'), the 19 votes of his party had no choice but to 'abstain'.

as an aside. the ecb should take the deal of their original offer which did not require good/bad banks, but in fact funded the banks. by extracting this extra punishment the ecb risks what they originally were trying to avoid. that is the unwinding of the banks and the consequences of that in the full light of day (msm) rather than just in front of us fringe blog readers :)

very dangerous for the euro.

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