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Have The Russians Already Quietly Withdrawn All Their Cash From Cyprus?

Tyler Durden's picture


Yesterday, we first reported on something very disturbing (at least to Cyprus' citizens): despite the closed banks (which will mostly reopen tomorrow, while the two biggest soon to be liquidated banks Laiki and BoC will be shuttered until Thursday) and the capital controls, the local financial system has been leaking cash. Lots and lots of cash.

Alas, we did not have much granularity or details on who or where these illegal transfers were conducted with. Today, courtesy of a follow up by Reuters, we do.

The result, at least for Europe, is quite scary because let's recall that the primary political purpose of destroying the Cyprus financial system was simply to punish and humiliate Russian billionaire oligarchs who held tens of billions in "unsecured" deposits with the island nation's two biggest banks.

As it turns out, these same oligrachs may have used the one week hiatus period of total chaos in the banking system to transfer the bulk of the cash they had deposited with one of the two main Cypriot banks, in the process making the whole punitive point of collapsing the Cyprus financial system entirely moot.

From Reuters:

While ordinary Cypriots queued at ATM machines to withdraw a few hundred euros as credit card transactions stopped, other depositors used an array of techniques to access their money.


No one knows exactly how much money has left Cyprus' banks, or where it has gone. The two banks at the centre of the crisis - Cyprus Popular Bank, also known as Laiki, and Bank of Cyprus - have units in London which remained open throughout the week and placed no limits on withdrawals. Bank of Cyprus also owns 80 percent of Russia's Uniastrum Bank, which put no restrictions on withdrawals in Russia. Russians were among Cypriot banks' largest depositors.

So while one could not withdraw from Bank of Cyprus or Laiki, one could withdraw without limitations from subsidiary and OpCo banks, and other affiliates?

Just brilliant.

And if there was any doubt that the entire process of destroying one entire nation was simply to punish Cyprus, it can be completely cleared away now:

ECB officials contacted Latvia, another EU country that has received large Russian deposits, to warn authorities against taking in Russian money fleeing Cyprus, two sources familiar with the contacts said.


"It was made clear to our Latvian friends that if they want to join the euro, they should not provide a haven for Russian money exiting Cyprus," a euro zone central banker said.

If one thinks there is any material Russian cash therefore left in Cyprus with this epic loophole in place, we urge them to make a deposit in the insolvent nation. One person who certainly will not be allocating any of his money into Bank of Cyprus is German FinMin Schaeuble:

German Finance Minister Wolfgang Schaeuble said the bank closure had limited capital flight but that the ECB was looking closely at the issue. He declined to provide figures.

Perhaps because if he did, it would become clear that the only entities truly punished by this weekend's actions are not evil Russian billionaires, but small and medium domestic companies, and other moderately wealthy individuals, hardly any of them from the former "Evil Empire."

Companies that had to meet margin calls to avoid defaulting on deals were granted funds. Transfers for trade in humanitarian products, medicines and jet fuel were allowed.

The stealth withdrawals by Russians of course means that the two megabanks are now utterly drained of capital, and that the haircuts on those who still have unsecured deposits with the two banks will be so big it will likely mean a complete wipeout of all deposits. As in 0% recovery on your deposits!

In other words, by now any big Russian funds in Cyprus are long gone, and the only damage accrues to the locals: for one reason because their money over the critical EUR100K threshold has been "vaporized", and for another because the marginal driving force and loan demand creator in Cyprus, the Russians, are gone and are never coming back again.

This is what passes for monetary real-politik in the New Normal - an entire nation becomes collateral when pursuing a wealthy group of people. And the "wealthy group" is victorious in the end despite everything...

If we were Cypriots at this point we would be angry. Very, very angry.


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Mon, 03/25/2013 - 17:06 | 3374116 flacon
flacon's picture

War aginst electronic paper money by the electronic paper money war mongers. Is that why Zibnew said TECHNOCRATIC because it's like "THIS BEAT IS TECHNOCRATIC"?

Mon, 03/25/2013 - 17:06 | 3374132 Divided States ...
Divided States of America's picture

There has never been a moment in the history of mankind where the wealthy gets hosed for the sake of the common peasantry. I thought this was the case....but guess I was an idiot.

Mon, 03/25/2013 - 17:14 | 3374160 redpill
redpill's picture

The common peasantry will get their insured deposits, but there won't be much to do with them now that the Cypriot economy will be plunging into an abyss of depression for the next decade at least.

Mon, 03/25/2013 - 17:16 | 3374173 gmrpeabody
gmrpeabody's picture

You just can't make this shit up...

Oh wait..., maybe you can...


Mon, 03/25/2013 - 17:22 | 3374213 whotookmyalias
whotookmyalias's picture

LOL!  Take that!  Oh wait.....

Mon, 03/25/2013 - 17:30 | 3374240 Kitler
Kitler's picture


Job well done. Bonuses for everyone!

Mon, 03/25/2013 - 17:40 | 3374281 gmrpeabody
gmrpeabody's picture

Apparently, the toughest thing the Russians had to do was to remember their pin code.

Mon, 03/25/2013 - 17:43 | 3374291 The Phu
The Phu's picture

Me thinks Dijsselblom's template needs to be fixed... the next time the EU tries this, they better not leave the back door open.  Oh, those crazy Russkies!!!! Sneaky little bastards.

Mon, 03/25/2013 - 17:46 | 3374304 THX 1178
THX 1178's picture

Does this all assume that the 100% haircut for the remaining cypriot bank accounts will be enough? And if the 100% haircut happens, wont it mean riots in the streets like nobody's business? I mean-- isn't "collapse" pretty much certain? Economic or social? Or both?

Mon, 03/25/2013 - 17:54 | 3374339 James_Cole
James_Cole's picture

The amount of stupidty involved with this mess is truly mind-boggling. Each time you think they've reached the limit they go further.


Mon, 03/25/2013 - 18:04 | 3374382 SafelyGraze
SafelyGraze's picture

just got back from Russian Oligarchs meeting

boy are they mad

had planned to deposit billions in latvia, but ..

nixsky on that!

they are asking what to do with billions and billions

can't park it in a bank

can't park it in bit coin

where oh where to park it

if only there were a way


Mon, 03/25/2013 - 21:59 | 3374430 TruthInSunshine
TruthInSunshine's picture

Lest there be any doubt that the entire global fractional reserve fiat (whatever fiat, so long as it's conjured & distributed by a central Modern Money "Mechanic/Creature") financial system is a giant criminal racketeering enterprise:

While ordinary Cypriots queued at ATM machines to withdraw a few hundred euros as credit card transactions stopped, other depositors used an array of techniques to access their money.


No one knows exactly how much money has left Cyprus' banks, or where it has gone. The two banks at the centre of the crisis - Cyprus Popular Bank, also known as Laiki, and Bank of Cyprus - have units in London which remained open throughout the week and placed no limits on withdrawals. Bank of Cyprus also owns 80 percent of Russia's Uniastrum Bank, which put no restrictions on withdrawals in Russia. Russians were among Cypriot banks' largest depositors.

I was never supportive of this whole destructive exercise in idiocy that was ostensibly implemented to "save" Cyprus from the moment it was spoken of (in whatever variation of confiscation schemes that it was). The claims about "hot Russian money" and Cyprus being some tax haven island nearly singularly floated on pillars of dirty laundry seemed  to be blown massively out of proportion by the Main Stream Proxy Mouthpiece Media from the start, and rightfully warranted a very healthy dose of skepticism all along (which the actual data now shows was a justified skepticism).

This was all another case (in a long history and volume of such cases) of a blood letting of average citizens in a nation that claims to be an allegedly sovereign one (but which clearly has a deeply captured political and regulatory structure), on the altar of the global banksters, after all, just as many initially surmised.

Continental Europeans will see the Cypriotic Treatment, in all types of variations on the basic scam. Unless someone could prove that this isn't and hasn't been some intentional knocking over of dominos, cascade now beginning, that should be any rational person's presumption.

As a brilliant, truth-y philosopher, observer of "the system," & comedian once said:

"They're coming for whatever you have. And they'll get it eventually. They'll get it all."

Mon, 03/25/2013 - 23:20 | 3375423 Spirit Of Truth
Spirit Of Truth's picture

Told ya....that Russians are plotting the destruction of world Capitalism.  The Kremlin's malintent never changed with the supposed end of the Cold War and seeming collapse of Communism:

Wouldn't be surprised if using Cyprus as the initial falling domino of the worldwide Ponzi scheme of high finance is part of their grand strategy.

Mon, 03/25/2013 - 22:54 | 3375462 willwork4food
willwork4food's picture

@Truth- Thanks for that. Good views on things. Carlin would agree.

Mon, 03/25/2013 - 23:07 | 3375515 Bananamerican
Bananamerican's picture

"It was made clear to our Latvian friends that if they want to join the euro, they should not provide a haven..."

Who the hell would "want" to join the EU at this point?

Tue, 03/26/2013 - 00:13 | 3375617 Kirk2NCC1701
Kirk2NCC1701's picture

Not so sure everyone can handle the truth or stay focused on it:  That the Brits had even MORE money in Cyprus banks than the 'Oligarchs'.  How did the Bail-In/Get-Out work out for the Brits? 

I can see it now: Bond and Miss Onatop do a midnight raid.  Bond did what Bond does: A quick in & out, get the job done.  She gets the media flash, he gets the stash.  For Queen & Country, eh James?

While Bond does Onatop, MI-6 does Berezovsky.  Both killer deals.

Tue, 03/26/2013 - 05:12 | 3375869 StandardDeviant
StandardDeviant's picture

Hell of an accusation, that last one.  What is your evidence, Mr. "handle the truth"?

Mon, 03/25/2013 - 18:31 | 3374446 cifo
cifo's picture

Who TF keeps billions in a bank?


Mon, 03/25/2013 - 19:36 | 3374691 ILLILLILLI
ILLILLILLI's picture

Well, when the warehouse is overflowing with banknotes, you gotta put them somewhere....

Mon, 03/25/2013 - 21:23 | 3375104 Matt
Matt's picture

Not Walter White, that's for damn sure:

Mon, 03/25/2013 - 20:07 | 3374827 PathForward
PathForward's picture

To keep the entertainment rolling, the Russian oligarchs could purchase a few silver futures contracts and then stand for delivery...

Mon, 03/25/2013 - 19:22 | 3374639 Turin Turambar
Turin Turambar's picture

Stupidity?  I'm not so sure.  If I were a Cypriot bankster, I'd prefer to make a hole available for the Russians Oligarchs through which they could remove their monies.  It sure beats the alternative - a 6 foot deep hole for me in which to take a dirt nap.

Mon, 03/25/2013 - 19:47 | 3374749 Clycntct
Clycntct's picture

I think your on to something$

Mon, 03/25/2013 - 22:04 | 3375256 SDShack
SDShack's picture

I bet the Cyprus bank officials were more than happy to move that Oligarch money for the right "fee", even thought the banks were supposed to be closed. The first deal was stealing 10%. The final deal was stealing 40% up to 70%. Something tells me the Cyprus bank officials would be happy with 10%, and probably the Russians too. 10% of 40B Euro (supposed held by depositers over 100,000E) can buy you out of a lot of trouble. So what if they are breaking a few laws. The rule of law doesn't exist for bankers anyway.

Mon, 03/25/2013 - 22:38 | 3375413 masterinchancery
masterinchancery's picture

Yep, and maybe family members too. Whereas gold in a safety deposit box is the alternative.

Tue, 03/26/2013 - 03:06 | 3375710 The Navigator
The Navigator's picture

You'll know that the Russians got their money out if (IMF Chief) Christine Lagarde is still above ground in 30 days.

Mon, 03/25/2013 - 21:41 | 3375158 Mike in GA
Mike in GA's picture

Oh I'm sure our current crop of economic lever pullers will redefine world-class stupidity when it's their turn. 

Especially when the Nobel Prizewinners opinions are included.


Mon, 03/25/2013 - 23:55 | 3375605 ejmoosa
ejmoosa's picture

Well, these are, in the end, government officials, correct?


Did your eally expect a different result in the end?

Mon, 03/25/2013 - 18:18 | 3374414 akak
akak's picture


Does this all assume that the 100% haircut for the remaining cypriot bank accounts will be enough?


Due to the flight of Russian capital from the banks in Cyprus, all Cypriot small and medium-sized depositors will therefore now be forced to take a 150% haircut on their accounts --- that's right, folks, they will have to PAY for the privilege of having lost their life savings!  That is simply justice, bankster-style.

Mon, 03/25/2013 - 18:22 | 3374427 fonzannoon
fonzannoon's picture

Akak they made it clear insured deposits were to be left alone. That was their whole stupid theme today. How can tomorrow's theme be "insured deposits to be confiscated to make up for uninsured deposits having transferred out"?

Mon, 03/25/2013 - 18:37 | 3374476 Al Huxley
Al Huxley's picture

You're assuming there has to be some kind of coherency and historical continuity in the story Fonz, in which case your point would be valid.  But as the media and politicos show time and again, they have absolutely no problem changing today's story without ever referencing or even considering whether it contradicts yesterday's story.  They refuse to acknowledge the issue, so from the media's perspective it doesn't exist.  'We've always been at war with Eastasia'.

Mon, 03/25/2013 - 18:45 | 3374508 fonzannoon
fonzannoon's picture

true enough. if they end up taking insured deposits after all I just hope it shakes people up. But it won't.

Mon, 03/25/2013 - 22:44 | 3375426 jon dough
jon dough's picture

I think the Russkies got the week so they could pull this off. Rather than it being a big, fat, OOPS, it was part of the plan, all along.

Mon, 03/25/2013 - 19:54 | 3374781 CptAwesome
CptAwesome's picture

No, we have always been at war with Eurasia.


Mon, 03/25/2013 - 23:17 | 3375542 jeff montanye
jeff montanye's picture

"Winston Smith works as a clerk in the Records Department of the Ministry of Truth, where his job is to rewrite historical documents so they match the constantly changing current party line. This involves revising newspaper articles and doctoring photographs—mostly to remove "unpersons," people who have fallen foul of the party. Because of his proximity to the mechanics of rewriting history, Winston Smith nurses doubts about the Party and its monopoly on truth." 

another terrorist?

Mon, 03/25/2013 - 20:49 | 3374987 RockyRacoon
RockyRacoon's picture

DjizzBoom diplomacy.    I like the sound of it.

Mon, 03/25/2013 - 21:41 | 3375160 TheFourthStooge-ing
TheFourthStooge-ing's picture

akak said:

Due to the flight of Russian capital from the banks in Cyprus, all Cypriot small and medium-sized depositors will therefore now be forced to take a 150% haircut on their accounts --- that's right, folks, they will have to PAY for the privilege of having lost their life savings!  That is simply justice, bankster-style.

Your comment, in addition to being an exemplary example of cynical cynicenism, might prove to be more prescient than you realize.

Due to the Russian capital floating away from Cyprus like the smoke from dozens of burning pallets of €100 notes, the real underlying problem (as opposed to the official problem, which the drastic "solution" of seizing bank deposits was supposed to resolve) remains unaddressed.

Quite possibly, someone within this clusteurofuck is shitting gold-plated tungsten bricks because the problem they intended to paper over with the stolen loot remains unpapered.

The next time another bizarre "template" is proposed, keep an eye out for unraveling in unexpected places.

Mon, 03/25/2013 - 17:47 | 3374316 jcaz
jcaz's picture

Blah- the smart, dirty money was gone from Cyprus a month ago- what do you think started all this in the first place?

Mon, 03/25/2013 - 20:36 | 3374945 The Big Ching-aso
The Big Ching-aso's picture

Well they may have withdrawn quietly but I have a feeling they'll return with a Big Bang.

Tue, 03/26/2013 - 06:59 | 3375953 Mountainview
Mountainview's picture

I wonder if the oligarchs had no better idea than to leave their money on savings accounts...I suppose Cyprus bank worked as intermediaries and the money traveled on to God knows where!

Mon, 03/25/2013 - 17:52 | 3374323 chubbyjjfong
chubbyjjfong's picture

The bank manager with a gun held to his childs head: "Yes sir, no pin neccessary. How much did you need transferring?.. certainly".

Mon, 03/25/2013 - 18:10 | 3374394 Gief Gold Plox
Gief Gold Plox's picture

BTW Tyler just gave you the comment of the day award!

Mon, 03/25/2013 - 18:31 | 3374449 Pairadimes
Pairadimes's picture

This explains a lot. The fact that certain wealthy Russians were able to get their money out before taking a haircut explains why there is not a large pile of Cypriot bureaucrats in the street in front of the bank.

Mon, 03/25/2013 - 19:50 | 3374768 Muddy1
Muddy1's picture

digitized banking, baby

Mon, 03/25/2013 - 21:18 | 3375082 Dungeness
Dungeness's picture

And just as tough, simply mention that oil and gas supplies to the EU could be on holiday as well. Perhaps, indefinitely?

This drama is better than any episode of As The World Turns...


Mon, 03/25/2013 - 22:40 | 3375418 masterinchancery
masterinchancery's picture

Yes, a cold winter could have been unfortunate, but now all is good.

Tue, 03/26/2013 - 00:44 | 3375655 Kirk2NCC1701
Kirk2NCC1701's picture

Chekhov tell me that he still doesn't bank in Cyprus, ever since his ancestor Ollie Garkov lost his shirt there.  Kirk out.

Mon, 03/25/2013 - 21:18 | 3375090 sunnydays
sunnydays's picture

No wonder there has been silence from Russia and they did not make a deal with Cyprus.  They were already moving all their money.   

I would loved to have seen the faces of the EUC when they found out the Russian money was gone. 


Mon, 03/25/2013 - 22:26 | 3375359 dtwn
dtwn's picture

So this is why Putin wasn't so upset today. . . . . .

Tue, 03/26/2013 - 06:09 | 3375911 HardAssets
HardAssets's picture

Now this story makes a lot more sense. The idea that billionaire money - - - and especially mafia and KGB money would be grabbed just didnt add up.

I wonder if this aspect of the rape story (the burden is all on them) is ever mentioned in Cypriot newspapers ?  Do they read ZeroHedge ?

Mon, 03/25/2013 - 17:43 | 3374288 Sudden Debt
Sudden Debt's picture


Mon, 03/25/2013 - 19:38 | 3374697 caconhma
caconhma's picture

EU assholes bureaucrats want to create European Soviet Union.

Shit, these Russians had this shit for almost 70 years. So, they know how to play this game.

Mon, 03/25/2013 - 17:23 | 3374219 toys for tits
toys for tits's picture

So someone finally gets to say to a banker, "... and its gone."



Mon, 03/25/2013 - 17:30 | 3374242 gmrpeabody
gmrpeabody's picture

By the way..., the EU owes me a new keyboard..., and a new contact lense (I think).

Mon, 03/25/2013 - 17:34 | 3374259 A Nanny Moose
A Nanny Moose's picture

It's all fun n' games, till someone loses an eye.

Mon, 03/25/2013 - 17:45 | 3374295 toys for tits
toys for tits's picture

An interesting article from Der Spiegel:

The verdict of Russian state television on Europe's effort to save Cyprus was damning. The last week "will enter the history books of the EU as a destructive one," said Dmitry Kiselev, the presenter of the popular news program Vesti Nedili on the Rossiya channel.

Kiselev heaped criticism on the forced levy to be imposed on bank deposits in Cyprus. He said the last time a Western European government proceeded so recklessly was when Adolf Hitler expropriated the Jews.

Nazi propaganda at the time described the money held by Jewish people as "dirty," said Kiselev. That was precisely how Europe was talking about Russian assets deposited in Cyprus, he added.


In the meantime it has emerged that the Kremlin might be willing to provide Cyprus with financial assistance after all. President Vladimir Putin ordered his government to support the efforts of the Euro Group, made up of euro-zone finance ministers, said Kremlin spokesman Dmitry Peskov. Russia plans to extend the terms of the €2.5 billion loan Moscow granted to Cyprus in 2011.

"President Putin considers it possible that the efforts of the Cypriot president and of the European Commission could be supported," said Peskov. Last Friday, Moscow declared that negotiations with Cypriot Finance Minister Michalis Sarris had been concluded without an agreement.

Mon, 03/25/2013 - 18:04 | 3374385 new game
new game's picture

well, this would explain why the russkies were cool calm and didn't give a shit, except for some theatrics for good show of what was expected...

Mon, 03/25/2013 - 18:08 | 3374390 new game
new game's picture

they will be back for some real bargains, they laughed first and will have the last laugh.


Mon, 03/25/2013 - 18:50 | 3374532 SmittyinLA
SmittyinLA's picture

we're talking about people that play chess versus people that play with twitter.

Mon, 03/25/2013 - 23:48 | 3375593 palmereldritch
palmereldritch's picture

It would also explain why the levy rapidly shot to 40%

Mon, 03/25/2013 - 18:55 | 3374553 FlyingDutchman
FlyingDutchman's picture

I think this was the plan all along.

The Dijsel crew got played like children.

Mon, 03/25/2013 - 19:54 | 3374783 Debugas
Debugas's picture

Kiselev is a well known presstitute so i would not take a word of his seriously

Mon, 03/25/2013 - 17:21 | 3374201 fonzannoon
fonzannoon's picture

So the "bail in" will end up being contributions from a few people who were not in the big club? The small money got protected and the big money got out....that leaves who?

What was the point of all this again?

Mon, 03/25/2013 - 17:25 | 3374225 toys for tits
toys for tits's picture

To destroy an industry in a country that had low tax rates.

Mon, 03/25/2013 - 17:28 | 3374234 fonzannoon
fonzannoon's picture

It sure seems that way.

Mon, 03/25/2013 - 17:34 | 3374262 Divided States ...
Divided States of America's picture

Looks like the middle class gets hosed again....

Mon, 03/25/2013 - 17:59 | 3374358 DaveyJones
DaveyJones's picture

at least they're always thinking of us

Mon, 03/25/2013 - 18:14 | 3374405 TeamDepends
TeamDepends's picture

Do you want progress or not?

Mon, 03/25/2013 - 17:39 | 3374278 Mesquite
Mesquite's picture

Well the IMF's global reputation  is still intact, I see..

 And when it comes to one 'shooting oneself in the foot'..

  The ECB surely showed the way...

Mon, 03/25/2013 - 17:56 | 3374347 rwe2late
rwe2late's picture

destroy an industry profiting outside NATO-EU


as has been contended here at ZH,

to curb Russian influence (and military bases) in Cyprus,

by debt enslaving the Cypriots (and their potential fossil energy reserves) to the EU Troika cabal.

Mon, 03/25/2013 - 17:45 | 3374292 JR
JR's picture

It was a deliberate wipeout attempt of the Cyprus and Russian middle classes. And Legarde et al., knew it.

On March 18, Reuters wrote: Big Russian Money Out of Cyprus.

"Sources in the wealth management, advisory and banking industry in Nicosia say Russia depositors are typically smaller savers and entrepreneurs. Fiona Mullen, a British economist in Cyprus, said Russians she encounters tend to be buying 300,000-euro homes, not the palaces favored by oligarchs in London.

"'There is a lot of Russian business done through Cyprus,' she said. 'It's so difficult to do business in Russia, you've got to bribe so many people, that it's easier to do it through Limassol. It's kind of the back office for Russia.'

"A business adviser said of his Russian customers: 'Clients would be well off, but not the private jet kind.' Most did not use Cypriot banks to keep money but as a conduit for funds.

"Cyprus charges foreigners no tax on dividend income and capital gains. A double taxation treaty with Russia provides attractive incentives for Russians to use Cypriot banks..."

Mon, 03/25/2013 - 21:26 | 3375115 Terminus C
Terminus C's picture

I guess they paid the bribe in the end anyway...

Mon, 03/25/2013 - 22:55 | 3375464 Kirk2NCC1701
Kirk2NCC1701's picture

The joke's on us, because ...

even after several blogs here, where (1) others pointed out that the Brits have/had even bigger deposits than the Russians, and (2) after I told you several times that most Russians (by number, not total deposit) were in fact small business guys (job-creating entrepreneurs) who were depositing gray money (legally earned but not declared), the media and ZH bloggers are STILL talking mostly about the "Oligarchs". 

/Tell me the MSM propaganda isn't working.  Even on ZH'ers. /s   Sheesh!

Mon, 03/25/2013 - 23:06 | 3375514 malek
malek's picture

Take a step back and look at the bigger picture.

The Eurocrats can't be all of them so stupid to let this happen accidentally. So the Cypriot PM provided time for the Russian's to pull their money last week, while the Eurocrats were watching.
So the intent could have been to reduce the financial connections between Europe and Russia. Now who do you think could have an interest in that, after all the moves to the contrary (so increasing connectedness) for the last years such as fxswaps between the Fed and Euromember central banks?

I get the feeling that someone is starting to put the pieces in place for the next cold war chess game, if not for more than that.

Mon, 03/25/2013 - 17:22 | 3374207 Yikes
Yikes's picture

The insured deposits were going to be paid on the assumption that all the Russian money was going to be confiscated.  That's the problem.

The cost to the Troika went way the hell up and have been shown as chumps.  What is Merkel going to do, run to the Russian Embassy and yell "YOU CHEATED!". Crips.

It's dawning on the ECB and everyone else for that matters, that there is no financial controls and when things get serious, everyone looks out for themselves.  You think Russia give a flying you know what about ECB "Rules".  Nyet

Mon, 03/25/2013 - 17:26 | 3374224 fonzannoon
fonzannoon's picture

Why would Merkel run to the Russians? The banks were open in London as per the article. They should be yelling at London...except London was probably leaving those banks open to make sure they were off the people to kill list.

So again...if the big money (Russia) was allowed to leave....and the little money is insured...whose deposits are getting clipped...and what the hell was the whole point of this?

Mon, 03/25/2013 - 17:43 | 3374289 MachoMan
MachoMan's picture

Or there was an express agreement with the russians...  Do you really think they're going to just sit there and take it in the ass?  All wars are proxy wars for the major powers...  a shit ass bank run in BFE skanky europe is no different... 

Apparently the ECB blinked on that one... 

Mon, 03/25/2013 - 17:51 | 3374327 fonzannoon
fonzannoon's picture

Well if Merkel was fake mad at Cyprus I can't wait to see how fake mad she is at London for allowing this minor oversight...

Mon, 03/25/2013 - 18:43 | 3374503 MachoMan
MachoMan's picture

What the fuck did the wizard do when toto pulled the curtain?  Not a goddamn thing...  he's a fucking mortal that was about to get gang raped...  albeit by a cowardly lion, but his fate was the same even against that ragtag group.


Mon, 03/25/2013 - 18:01 | 3374368 DaveyJones
DaveyJones's picture

"dead on"

Mon, 03/25/2013 - 18:34 | 3374462 Clever Name
Clever Name's picture

More importantly, if all the big money is gone what is even left to be clipped? This whole plan was never about recapitalizing the banks in the first place (it was nowhere near enough money, right?) so what the hell was the play here? The average middle class shmoe with 110k will lose it all?

Mon, 03/25/2013 - 22:28 | 3375363 HardlyZero
HardlyZero's picture

Yes, this explains the 4% haircut for the insured was the only money remaining to tax.

It seems the Russians are very careful and made sure they had a rip cord exit setup which could be executed at any time necessary 24/7.

Makes sense...and more sense as we find out the details.


Mon, 03/25/2013 - 18:58 | 3374546 SmittyinLA
SmittyinLA's picture

Its a "test run" for US actions, our federal reserve backstopped this "deal", if they didn't have explicit Executive authorization they* could be criminally prosecuted under the Foreign Corrupt Practices Act, bribing a foreign government to rip off its citizens is last time I checked a criminal act (bribery, theft) as well as , unless you have "sovereign immunity" which only comes with explicit permission.  

*they being whoever put up the X billion in exchange for the ripoff, that is a bribe. 


Where is the Congressional investigation of US financial foreign policy?

Or are we all OK with federal Reserved sponsored theft and public foreign policy?  

Mon, 03/25/2013 - 23:24 | 3375558 Just Ice
Just Ice's picture

"Where is the Congressional investigation of US financial foreign policy?"

Ha!  Where is the congressional investigation of Fed's elimination of free market exchanges in the US through its perverted use of monetary tools?  Where is the congressional investigation of the Fed's debasement of the national currency and its destructive home and abroad?  Where is the congressional investigation of the interference in free markets by the presidential working group on financial markets which effectively chooses winners and losers among market participants as well as obliterates any effective use by market participants of various financial products?  Where are congressional representatives of the people as opposed to the lobbyists, cronies, special interest corporates and banksters?



Tue, 03/26/2013 - 01:46 | 3375713 knukles
knukles's picture

You can be sure a lot of money stayed in/went to the City

Mon, 03/25/2013 - 17:30 | 3374244 machineh
machineh's picture

No problem. Start negotiations on Bailout II of Cyprus.

It was penciled in for next year, but now needs to be moved up to next month.

Greece needed two bailouts. Cyprus probably will require three.

Mon, 03/25/2013 - 18:40 | 3374492 edb5s
edb5s's picture

Ponzi event horizon!!!

Mon, 03/25/2013 - 18:45 | 3374512 Parrotile
Parrotile's picture

Greece has needed two bail-outs so far.

Just look how well their economy has "recovered". The employment figures are the envy of the Western World!!

There'll be a lot of competition for EU Bailouts in the coming months and years - just hope everyone in the Eurozone will be happy to have their bank accounts "trimmed" to provide "assistance to the poor", or will we finally see a trend towards the traditional "savings under the bed" approach - with zero Bank deposit interest, at least you KNOW where your cash stash is located.



Mon, 03/25/2013 - 21:30 | 3375128 Matt
Matt's picture

We're going to need a bigger bucket.

Mon, 03/25/2013 - 18:02 | 3374373 Buck Johnson
Buck Johnson's picture

That's what I was thinking after hearing this.  Everthing depended on the big whales aka Russian billionaires still having their money in those banks to be taken.  And therefore there would be no cuts to the populace.  With that gone (which I can't believe the ECB was so stupid but then again they did start this hair brained scheme in the first place), I guarantee that there isn't enough money of unsecured cyprus people that can cover those bilions and if so, it will destroy what is left of their economy and they will be in a depression real soon.  Especially since people will have a run on the bank and take their money out which increases the need for more money to bailout the country.


Mon, 03/25/2013 - 18:42 | 3374481 akarc
akarc's picture

"The common peasantry will get their insured deposits, but there won't be much to do with them now that the Cypriot economy will be plunging into an abyss of depression for the next decade at least."


"looks  like the middle class gets hosed again"

My hope would be that the U.S. common peasantry would take a good look a this because the same damn money shuffle is happening here. Everyone is throwing heat at the EU and the Ruskies (niether of which I am a fan of) but the gig is, the cypriots got comfy and complacent and allowed their rulers and banks free reign.  Sound familiar?  Like maybe who caused the fucking economic problems we still suffer from here? And is playing the same game but at a faster clip?

But then that would be my hope. Unfortunately there be a whole heap of people out there never heard of Cyprus. 

Been watching all these threads and see very few postings on how all this will/is impacting us. 

Zero Hedge has posted numerous articles re the wealthy getting wealthier and the crooks/bankster (U.S.) getting more brazzen w/ their crimes and only place I see any real anger is on this site. In the streets there still blaming it on blacks and illegal immigrants.

Our time is coming and unfortunately for the most part our citizenry is incapable of comprehending or accepting or doing anything about reality.

Yo Cognitive Dissonance I need some freaking meds!





Mon, 03/25/2013 - 23:40 | 3375579 jeff montanye
jeff montanye's picture

"cypriots got comfy and complacent and allowed their rulers and banks free reign." 

does one really allow a ruler free reign (or rein)?  what does being a ruler mean?

as carlin noted: you have owners.  they own you.

Tue, 03/26/2013 - 02:41 | 3375772 All Risk No Reward
All Risk No Reward's picture

"The common peasantry will get their ILLUSION OF insured deposits AWHILE LONGER"


Their deposits don't exist, so they can't get them.

The Debt Money Tyranny music is winding down and the sadistic criminal oligarchs are swooping in to kick granny out of the chair so they can sit down on 10 of them each.

BTW, there is maybe 1 chair for 100 people.

99/100 are going to have very little when this is over.

Mon, 03/25/2013 - 17:16 | 3374169 Zer0head
Zer0head's picture

Sergei, speak to them softly but get my fuckings moneys

Mon, 03/25/2013 - 17:18 | 3374177 kaiserhoff
kaiserhoff's picture

In any case, I don't think Putin is unhappy.

His mouth piece Medvedev said, "the stealing of what has been stolen continues."  Crocodile tears?

The Russians getting hit, to the extent that there are any, are the rich expats, mostly those who had a run-in with Putin.

They have cash and the connections in Russia to give the Dictatorship trouble.  I think this does 10 years of dirty work for the Russian Regime.  Wheels within wheels.

Mon, 03/25/2013 - 17:19 | 3374179 Koffieshop
Koffieshop's picture

"There has never been a moment in the history of mankind where the wealthy gets hosed for the sake of the common peasantry."

Look up what happened during the French Revolution.

Mon, 03/25/2013 - 17:35 | 3374263 Going Loco
Going Loco's picture

Look up what happened to the peasantry when Robespierre got going (until he in turn was eaten by his own revolution).

Mon, 03/25/2013 - 17:49 | 3374320 booboo
booboo's picture

Yes, let us look what happen during the French Revolution, Robespierre and his cohorts took over, lived in luxury, started lopping off the heads of anyone they thought were a threat to their elightened ways.

Repeat after me, "Governments are fucking evil and they all grow towards despotism"

Mon, 03/25/2013 - 19:41 | 3374719 TheProphet
TheProphet's picture

Yes. That certainly was Orwell's contention.

Mon, 03/25/2013 - 22:34 | 3375395 willwork4food
willwork4food's picture

If I was in charge I would be different. Promise.

Mon, 03/25/2013 - 23:47 | 3375592 jeff montanye
jeff montanye's picture

and napoleon was different from the bourbon monarchy.  he invaded russia with a citizen army, captured moscow and began his great retreat in mud season.  oops.

obama is different from bush.  darker, with a better jump shot, perhaps not as good with a chain saw. 

Tue, 03/26/2013 - 06:57 | 3375948 samcontrol
samcontrol's picture

Jeff , the great army was not a citizens army, second Moscow was abandoned not captured, there was no other time to retreat they would of starved! There is no oops, what he tried was impossible. You think your mighty empire could hold Moscow? Who is paying? You are broke!
You have no clue on French history , alors silence!

Tue, 03/26/2013 - 02:44 | 3375774 All Risk No Reward
All Risk No Reward's picture

“ In questions of power, let no more be heard of confidence in man, but bind him down from mischief by the chains of the Constitution.”
~Thomas Jefferson

"Power corrupts.  Absolute power corrupts absolutely"
~Lord Acton

Debt Money Tyranny - the world enslaved by 3rd grade math (reality is much stranger than fiction)

Share the link far and wide...  Can't stop the signal of prima facia establishment fraud - the whole stinking thing for 100+ years that they kept silence in the face of a fraudulent monetary system.

Mon, 03/25/2013 - 17:45 | 3374275 grid-b-gone
grid-b-gone's picture

American Revolution, French Revolution, Russian Revolution, ... even going back 5,000 years, check out NOVA's "Iceman Murder Mystery."

In fact, "revolution" seems to be mostly used when the status quo and wealthy/entrenched are the losers. 

I didn't give the down arrow, but I think there are plenty of counterpoint historical examples. What we see today has been the cyclical nature of humans since the beginning of time.

The wealthy will continue to try to consolidate power, amass fortunes, and pass them on to offspring untaxed until their drive is so oppressive that they lose it all in the backlash. This is the way it has always been and why the happiest people are rarely the very rich or the very poor.

Templates exist on both sides.

Mon, 03/25/2013 - 17:41 | 3374286 fonzannoon
fonzannoon's picture

That Dutch Fin Min spoke the truest words ever spoken today. This will be the template going forward. The most important part of the template being that certain depositors will absolutely be able to get their money out during the bank holiday.

Yeah the banking system is not a totally fraudulent rigged mess. Yes let's trust it with our life savings....

Mon, 03/25/2013 - 17:59 | 3374357 Lordflin
Lordflin's picture

Hosed... maybe not... guillotined though...

Mon, 03/25/2013 - 19:40 | 3374711 max2205
max2205's picture

Bond, James Bond...

Haircuts now to 70%

Mon, 03/25/2013 - 20:01 | 3374812 Muddy1
Muddy1's picture

"There has never NEVER been a moment in the history of mankind where the wealthy gets hosed for the sake of the common peasantry. I thought this was the case....but guess I was an idiot."


There, fixed it, we knew what you meant to say

Mon, 03/25/2013 - 20:16 | 3374854 optionsman
optionsman's picture

all i want to do is to reduce the dominance of rentiers in this society. otherwise wealthy i want to protect. i also still hope for restoration of the relatively free price discovery in the markets, ie all markets ;)

Mon, 03/25/2013 - 22:21 | 3375339 Altavoz-de-Verdad
Altavoz-de-Verdad's picture

I don't know why you ever thought it was all about hosing the wealthy for the sake of the common peasantry.  Where in the world did you ever get that idea?  It was simply one group of wealthy elites trying to confiscate the property of another set of wealthy elites.  The peasantry were going to get proper f*cked regardless of how it worked out.

Mon, 03/25/2013 - 17:46 | 3374305 Gold...Bitches
Gold...Bitches's picture

The comic farce this has become is ridiculous.  However, I do find it endlessly amusing to see the banksters (IMF et al) getting bankstered by the Russians.

Mon, 03/25/2013 - 18:20 | 3374421 ElvisDog
ElvisDog's picture

The headline of this story may be why Russia doesn't seem overly upset about the course of events. The one week window given to them was probably part of the deal.

Mon, 03/25/2013 - 21:00 | 3375036 kill switch
kill switch's picture

I thought they where flushed out early? 

Mon, 03/25/2013 - 22:36 | 3375406 rotagen
rotagen's picture

Good I hope they did.  Especially since Russia got rid of much of it's private bank and made it public.  Something that spits in the face of the Eurocrats, Rothschilds, Rockefuckers and other western central bank scum.

Mon, 03/25/2013 - 17:04 | 3374120 icanhasbailout
icanhasbailout's picture

Epic Fail

Mon, 03/25/2013 - 17:06 | 3374129 flacon
flacon's picture

My new beverage will be titled: "Fepic Ale".

Mon, 03/25/2013 - 17:53 | 3374334 ebworthen
ebworthen's picture

I like it!

How about "Expropriation Stout" or "Levy Lager"?

Mon, 03/25/2013 - 18:27 | 3374438 hooligan2009
hooligan2009's picture

cloudy club soda?

Mon, 03/25/2013 - 18:56 | 3374554 Likstane
Likstane's picture

"chickens last stand" blond ?

Mon, 03/25/2013 - 19:40 | 3374715 Legolas
Legolas's picture

DieselBoom Spritzer, with a Fibonacci Swirl !  Lights out after one of these.

Mon, 03/25/2013 - 17:04 | 3374121 Kirk2NCC1701
Kirk2NCC1701's picture

The guy in the picture is Croatian.  Has the money split for Split?  ;-)

Mon, 03/25/2013 - 17:04 | 3374123 achmachat
achmachat's picture

more than a month ago.
almost all of it.

Mon, 03/25/2013 - 17:04 | 3374124 ATM
ATM's picture

Who couldn't have seen this coming?

Mon, 03/25/2013 - 17:21 | 3374203 Urban Redneck
Urban Redneck's picture

Schaeuble - both his intellect and his integrity are as crippled as his body.

Tue, 03/26/2013 - 01:50 | 3375718 knukles
knukles's picture

Sitting in his wheelie chair gloved hand rising, screaming about an "Island Gap"

Mon, 03/25/2013 - 17:04 | 3374126 ParkAveFlasher
ParkAveFlasher's picture

Well this puts "Russian mob" in front of bondholders, taxpayers, investors, and depositors, but we knew that already. 

Now, who goes in front of "Russian mob"?

Mon, 03/25/2013 - 17:28 | 3374236 Sabibaby
Sabibaby's picture

I would say the "War on Drugs" mob who just goes straight to UBS and other banks to launder their money.

Mon, 03/25/2013 - 17:38 | 3374274 forwardho
forwardho's picture

If you end up in front of the "Russian mob" Its called a firing squad

Mon, 03/25/2013 - 17:41 | 3374285 MaxThrust
MaxThrust's picture

Now, who goes in front of "Russian mob"?

Cypriot politicians, who signed this deal.

On their knees head bowed, pistol at the back of their heads.


Mon, 03/25/2013 - 17:53 | 3374335 Kirk2NCC1701
Kirk2NCC1701's picture

Who goes in front of the "Russian Mob"?  A:  The London Mob with even more money in there... London Calling


Mon, 03/25/2013 - 17:05 | 3374127 Gamma735
Gamma735's picture

<sarc on>The troika are real geniuses.<sacr off>

Mon, 03/25/2013 - 17:22 | 3374210 Catflappo
Catflappo's picture

Thanks for the sarc guidance

Mon, 03/25/2013 - 17:09 | 3374138 Quinvarius
Quinvarius's picture

This is only what they know about so far.

Mon, 03/25/2013 - 17:09 | 3374139 philosophers bone
philosophers bone's picture

Put a tent over this circus!!

Mon, 03/25/2013 - 17:09 | 3374141 jubber
jubber's picture

So the good ole City of London kindly turned a blind eye...nice

Mon, 03/25/2013 - 17:26 | 3374228 Dugald
Dugald's picture

"So the good ole City of London kindly turned a blind eye...nice"

Indeed, and done with the aplombe and tact of real finacial masters  crooks....who have done swindle 101 at Eaton and Harrow....oh yes, and the London Poly....

Mon, 03/25/2013 - 17:35 | 3374267 toys for tits
toys for tits's picture

Now we see why the British politicos didn't want to restrict the bankers' bonuses there. Their guys are genuises.

Mon, 03/25/2013 - 18:52 | 3374537 NotApplicable
NotApplicable's picture

I find it fascinating that this secret was kept for a week.

Mon, 03/25/2013 - 17:10 | 3374143 Yikes
Yikes's picture

What can be created with a click of a button can moved with that same button.


Fiat.  Hoisted upon its own petard>

Mon, 03/25/2013 - 17:15 | 3374146 Number 156
Number 156's picture

When youre a bank exec, how else will you keep yourself and your family off a Russian hit list?

Mon, 03/25/2013 - 17:11 | 3374147 Jake88
Jake88's picture

Incredible. Now ZH publishes articles about what might have happened. Enquiring minds want to know.

Mon, 03/25/2013 - 17:29 | 3374239 Gene Parmesan
Gene Parmesan's picture

Feel free to ask the bankers for the account details. Or the oligarchs themselves.

I think it's probably safe to assume that such a gaping loophole was exploited over the course of the week it was left open. Particularly by people who presumably aren't balancing their own checkbooks.

Mon, 03/25/2013 - 17:11 | 3374149 Mesquite
Mesquite's picture

ECB leaning on Latvia... More stench...

Mon, 03/25/2013 - 17:12 | 3374150 Mordenkainen
Mordenkainen's picture

Well, that explains why the Russians were relatively calm through all of this. Putin must be pissing in his pants laughing.

Mon, 03/25/2013 - 18:21 | 3374387 sunaJ
sunaJ's picture

Call me cynical, but could it be that the bulk of the deposits were long gone due to fraud, illegal reinvestment, risk loss and banker profligacy?  I think that there is so much fraud, the books were seriously cooked.  It would explain why the banks would leave subsidiaries in other countries open, so they can say, "They took it all.  See? Look at these [fake] transactions.

I'm sure there was much capital flight ex-post facto, but the Cyprus banks may have intentionally left the spigots open as cover to the funds already misappropriated or otherewise gone.  I know it's hard to imagine that our illustrious financiers would ever think of running a second set of books as it became serious.

Mon, 03/25/2013 - 18:25 | 3374432 toys for tits
toys for tits's picture

The EZ told the Cypriots that Greek bonds were safe, so one bank bought 3 billion euros worth.  After the Greek haircuts they're worth 700 million.

This is just one example and shows that the Troika is doing nothing to stop the contagion but instead just keeps passing it from one jurisdiction to another.

Mon, 03/25/2013 - 18:25 | 3374433 hooligan2009
hooligan2009's picture

its standard practice...look at the$600m transfer from lehmans europe to lehman bros in the US, on the fateful september weekend that they failed, via JP Morgan of course..but we won't hear anything more about that, particualrly since it was the europeans that lost the money and the US that gained.

Mon, 03/25/2013 - 19:13 | 3374589 sunaJ
sunaJ's picture

A little like passing gold amongst each other in underground vaults.  Audit it all at once (fantasyland, I know) and they would have difficulty showing piles of tungsten in many places at once, just as they would be unable to do with unhypothecated customer funny money.

Mon, 03/25/2013 - 23:19 | 3375549 hooligan2009
hooligan2009's picture the bank of england, there has only ever been one gold bar "audited" by the 5,000 different owners?

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