Cyprus Banks Set To Reopen, To Serve As Glorified ATMs With A €300 Cash Withdrawal Limit
Tomorrow Cyprus banks will reopen sometime around noon (they are supposed to close at 6 pm but likely will close far earlier). What does that mean? Apparently nothing much. Because according ot various newswires the withdrawal limit at all banks will be €300 per day. This means that all those daytrading wannabes who want to get stinking rich and just buy US stocks with "no risk", will be unable to buy even one riskfree (at least until last September) stock of AAPL per day!
In other words, all said "reopening" will do, is to allow physical branches to be used as glorified ATMs but with a very terrified and confused carbon-based teller on the other side (the same ATMs which a few days ago saw their limit reduced from €300 to €120). All other cash transactions will be strictly curbed, virtually no cash will be allowed to exit the island, and the what's more the government will ban the termination of the oh so ironically-named time deposits. This means that time deposits will now become "permanent deposits", even if within the €100,000 insured limit. The good news: credit card treansactions will be permitted when paying for goods and services anywhere on the island. Of course, electronic cash just happens to not be physical cash, which is why the bank is so cavalier with allowing people to access their own money. Well, electronic 1s and 0s-based money.
In other words, tomorrow's bank reopening means absolutely nothing (as ATMs had worked for the duration of the Cyprus bail-in crisis), and anyone who had hoped they could just walk in and withdraw their entire insured deposit up to €100,000 will be severely disappointed. Of course, those who had more than €100,000: Poof, it's gone, step aside please.
Oh well: such is life in the New Normal under capital controls, in which there is a unquantifiable premium for having physical cash over electronic.
Learn from it.
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