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Cyprus Mail: "Exiting The Euro Is A Debate We Must Have"
Last week we laid out the apparent 'blueprint' from the EU Commission for every other country with a banking system in which non-performing loans are soaring. With Mario Draghi's patsy in place at the Cypriot Central Bank, happy to hand over the nation's gold at the beck-and-call of the EU leaders - despite the Cypriot President's disgust at the 'coercion' of the new deal chiding the central bank for "catching the government by surprise," it now seems, as this Cyprus Mail op-ed explains, that the people of this nation are ready for change - real change, , otherwise, "we may wake up one morning and find the country has completely shut down, crushed under the weight of its mounting, unserviceable debts with no banks, businesses or services able to operate."
Via The Cyprus Mail,
Every day seems to bring another piece of bad news regarding the state of economy, which has been in free-fall and has yet to hit the bottom. Since the first Eurogroup meeting of March 15, the situation has become worse by the day and there seems to be no end in sight. We may wake up one morning and find the country has completely shut down, crushed under the weight of its mounting, unserviceable debts with no banks, businesses or services able to operate.
We are not being alarmist, but pragmatic given the way things have veered completely out of control, the government powerless to stop the rut and our EU partners intent on revising their economic forecasts drastically downwards and making more demands of the bankrupt Cyprus state. On Wednesday night it was revealed that Cyprus would need to find another €6 billion to contribute to its bailout, after a ‘debt sustainability analysis’ showed that the financial situation is much worse than originally estimated.
Will the Bank of Cyprus’ uninsured depositors take an even bigger hit to cover this amount because it can certainly not be raised through taxes? And how long will it be before we are told that the €13billion we had to contribute to our bailout was not enough and an even bigger amount was required? We still do not know what ‘recommendations’ the anti-money laundering audit being carried out by Moneyval and Deloitte will eventually come up with and how these could adversely impact on the economy. For all we know, a bank may have to seek ECB approval before it opens an account for a foreign company.
The truth is that even after the ESM board of governors formally approves the proposal for a financial assistance facility agreement on April 24, the uncertainty and instability will remain. Friday’s announcement that the “Eurogroup is confident that determined action in line with the reform measures spelled out in the MoU will allow the Cypriot economy to return to a sustainable path based on sound public finances, balanced growth and financial stability,” could at best be described as wishful thinking and, at worst, a joke.
As countless economic analysts have pointed out, the numbers do not add up and the chances of macroeconomic targets being met are almost non-existent. Even the official debt sustainability analysis warned, “there is a non-negligible risk of a cycle of household and corporate defaults propagating through the economy, leading to further banking sector losses, worsening of labour market conditions, stronger than expected fall in house prices and a prolonged loss of business and consumer confidence.”
It happened in other eurozone bailouts and Cyprus will be no different, despite the Eurogroup’s confidence. This is why it is an imperative for the government to be prepared, exploring all options. Perhaps the economy’s interests would be better served if Cyprus exited the eurozone, defaulted on its debts and re-adopted the Cyprus pound. The government has taken a dogmatic stand against such a move, citing all the obvious negative effects, but the option needs to be explored and studied in-depth by experts.
The government should either hire a top consultancy firm or put together a team of economists, market analysts, technocrats, etc to carry out studies of the short- and medium-term effects of leaving the euro. The effects of staying in the euro and agreeing to a second and third bailout must also be studied. If we returned to the Cyprus pound, we may have recovery and growth sooner, but we may also have rampant inflation and be unable to import essential goods from abroad. Staying in the euro may protect what is left of people’s savings and ensure some economic stability but what good would that be in an economy expected to contract by more than 10 per cent this year?
Only once these options have been comprehensively investigated and reports prepared by experts can there be a proper debate on what must be done and an informed decision taken. The matter cannot be allowed to be resolved through slogans, rabble-rousing and emotional outbursts by populist deputies more interested in their re-election than the good of the country. We are now paying the very high price of this amateurishness and superficiality, with which we have approached issues of vital importance to the country, over the years.
The government needs to be prepared for the debate on leaving the euro that is certain to start as the country sinks deeper and deeper into recession. After all, the experts could conclude Cyprus would be better off out of the eurozone.
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I'm surprised Cypriot politicians haven't been torn to bits by now.
Nobody has the slightest will to survive left in them. Twenty years of Political Correctness does that to the human spirit.
Is that day soon?
Demand your gold back.
Iceland uber alles.
Nice bit of kabuki from the Cypriot politicians. They are powerless puppets (or mouthpieces as we say in Russian), who wish to survive and keep their sinecures.
Agreed. It's too late. They already took a bite from the poison apple and swallowed. No turning back now.
To Cyprus politicians: When you shut off the engine in your car you may notice it doesn't stop spinning immediately- it still spins over for a little while before it comes to rest. You already killed the ignition, it no longer matters if you throw fuel into it or how much. The engine has already been shut down and you are now coasting to a stop by the side of the road.
I agree no one has the will to fight. But it has nothing to do with "political correctness". Indeed, quite the opposite. The whole political correctness meme was a red herring thrown in to confuse you. Folks are so confused about which battle is supposed to matter that no one has the will to fight the important ones. Heard of divide and conquer? That's polictical correctness--a manufactured "debate" meant to polarize the populace into us and them, pitting us against each other over ridiculous arguments which don't matter one bit. Political correctness is not the enemy. It's just a distracting conversation, along with gay marriage or whatever other non-issue TPTB want to waste our time with. Don't fall for it. The biggest theft in history went on right under our noses while we debated the inane. We should just say, marry who you want, fine, done, now let's fight the important battle. Who cares about the rest! Who cares about polictical correctness or non-political correctness!
I agree no one has the will to fight. But it has nothing to do with "political correctness". Indeed, quite the opposite. The whole political correctness meme was a red herring thrown in to confuse you. Folks are so confused about which battle is supposed to matter that no one has the will to fight the important ones. Heard of divide and conquer? That's polictical correctness--a manufactured "debate" meant to polarize the populace into us and them, pitting us against each other over ridiculous arguments which don't matter one bit. Political correctness is not the enemy. It's just a distracting conversation, along with gay marriage or whatever other non-issue TPTB want to waste our time with. Don't fall for it. The biggest theft in history went on right under our noses while we debated the inane. We should just say, marry who you want, fine, done, now let's fight the important battle. Who cares about the rest! Who cares about polictical correctness or non-political correctness!
If one day we fight off all these bankers, and hang the lot of them, but the Politically Correct are still here, it will have all been for nothing.
Exactly, P.C. does to our minds what the Banks do to our pockets
somebody else did it. Works every time.
just name a topic and you can easely find somebody to blame.
We are now paying the very high price of this amateurishness and superficiality, with which we have approached issues of vital importance to the country, over the years.
This could be written about the US.
You vote for a moron who talks the talk....
AND THEN EVERYBODY JUST ASSUMES THAT:
He's a top economist.
A militairy leader.
A genius.
A prophet
...
Now... could it be... that all our polititicians... don't have these qualities?
Could be but i doubt it, some one would have let you know by now i am certain.
A person who tells the truth is not a moron.
A person who tells the truth either doesn't get elected or gets shot for their trouble shortly after being elected.
I haven't taken a close look at the "math", but if Cyprus is like Greece. Another "bailout" makes things worse, not better. If Greece had left the Euro two years ago they would be through the worst of it and on the road to recovery. Their Cypriot brothers should take note and leave NOW before it's too late and they too slip into a black hole they can never climb out of.
They have 'rigorous' gun control there...
No Plan B.
Exiting the DOLLAR is a debate we must have. BTFD + Stack!
Implement a 3 day workweek and trippling all salaries is a debate we must have.
Let all woman walk into the streets showing their tits is a debate we must have.
Taking others people money is a debate we must have.
Start a open fire on our liferaft in the middle of the ocean is a debate we must have.
Well, all women except Janet Napolitano, Hitlery, and Alan Greenspan!
"After all, the experts could conclude Cyprus would be better off out of the eurozone."
This debate should have been done months ago.
are that the same experts that.... who are these experts?!?
DEFINITION OF A EXPERT:
10000 HOURS WORKING ON THE SUBJECT.
Funny thing is... that rule says there are no experts to the topic.
Oh yeah ... Let's appoint a blue-ribbon commission that will study the problem and report back in six months. That's what Obama would do - then ignore the recommendations.
FORWARD>>>>
What really is needed is writing off of the debts.
It can be done in two different ways:
leaving the euro and re-writing debts in new currency and inflating out
OR
declaring default and ignoring creditors threats and staying in the eurozone
Well they can't leave until they have no gold left right?
Why do you think Germany can't get its gold back ?
There is nothing to debate. There are those that are getting paid bribes to sell off the national treasures and the citizens of Cyprus. They need to put the traitors into prisons and leave the EU. Get on the path of Iceland. Done deal.
The government should either hire a top consultancy firm or put together a team of economists, market analysts, technocrats, etc to carry out studies of the short- and medium-term effects of leaving the euro.
Finally, someone there is talking sense.
The problem is that it will be difficult for the government to hire someone who won't have a vested interest in supporting and protecting the debt-holders.
It would be the only way to rebuild their financial companies.
They'll probably give their gold away. Then exit. LMAO.
That will be because after they give up their gold the ECB and IMF won't give a shit.
If the gold is not in their hands, then it is gone and will be "sold." If they leave the Euro, they leave penniless and without many state assets. From the 21st century EU to the 19th century in a few months.
Default on the debts to the ECB and IMF who are nothing but a cabal of carpetbaggers.
Restore your own currency and sovereignty; remove decision making from the external kleptocrats and plutocrats, and restore it to representatives who sleep in the same town, city, region, state as the people their decisions affect.
If someone is going to steal your savings, make it the man or woman next door, not in Brussels with goons.
Debate my ass. Leave!
A shift from the Euro to a brand new (renewed) currency is a painful shift. Why can't they use transition currencies like the Swiss Franc and the English Pound as a temporary bridge back to their own currency?
The problem we're seeing IS the result of monetary monopolization. We need currency options which may include a basket of fiats along with PM options. Either way, how can they let their gold get confiscated!!
This is what I think of as reverse collateralization. When some government or bank lent them money it wasn't collateralized by gold, and the risk of default is always present. Now, when default becomes real, they demand collateral....even our retail banks couldn't get away with that on a $5,000 personal loan.
Slowly the scales fall.....
Cypriots, go full Iceland on the motherfuckers!
Red paint on banker cars.
I see a bunch of passive fools everywhere I look.
They are all addicted to Euro crack.
And we American's, it would sadly appear, are collectively addicted to Bernanke's crack.
They did nothing when it could have made a difference . They will do nothing now .
At the middle levels of the EU bureaucracy, the EU Commission staff quietly and privately recognise the euro was a mistake for Southern Europe, and that the euro-zone must and will inevitably break-up
The upper levels all pretend to play along however and no doubt will prolong the agony enormously
Ambrose Evans-Pritchard in the UK Telegraph has been and continues to be a great leading voice about the euro being a mistake ... and most of the UK including the financial community there agree with him
"Ambrose Evans-Pritchard in the UK Telegraph has been and continues to be a great leading voice about the euro being a mistake ... and most of the UK including the financial community there agree with him"
this is the same guy that is seeing the eurozone as the most clear and present danger for the UK financial community
wake up, your AEP is a good journalist when he is not busy being a rabid British conservative that sees the continent as a God-given hunting ground for British financial interests - the same people that in the same breath say that the EUR was a mistake and clamour for EuroBonds and more "superstate"
Unfortunately, given your graphic depictions, I think I just had an image flash by of the wrong crack ...
Oh well, we've all heard of plumber's crack.
Now we have Bernanke crack.
Talk about monetarily descending into a black hole!
WB7, re "They are all addicted to Euro crack" ? Seriously? Perhaps you're right, but the theme of the article is that this "Euro crack" is not potent enough, and that a Cyprus Pound would be much more... intoxicating
Yeah... today eurogroup is confident, tomorrow it will boss around again. It's like a spoiled brat! GO FUCK YOURSELF EUROGROUP TYRANT. YES BERNANKE, YOU CAN GO AND FUCK YOURSELF TOO!
I do not understand the Cypriots.
Give Troika the middlefinger, default, leave the EMU and you're independent to do anything you want. Introduce a new currency, link it to gold and people will love your currency.
Hey, what do you have to lose?
Invasion?
"Introduce a new currency, link it to gold and people will love your currency"
first you have to have enough gold. second, a gold backed Cyprus Pound would be even harder than the EUR. and there's the problem... the harder the currency, the more you have to accept math and defaults
if Cyprus is indeed willing to default... it would not really need to exit the EUR - but the real thorny issue is not the Cypriot sovereign debt, it's the Cypriot banks
It's all good. young people leaving cyprus - Google Search
This is a good lesson as to why countries should not rely on imports to serve their critical needs. Because of all of the items Cyprus must import, they can only survive at the whims of bankers, either through staying in the EU or by paying exorbitant interest on credit lines that are obtained after default. The vultures get them no matter what.
Unfortunately the same after the fact whining will happen everywhere else in the world once theyr are affected. While the few voices trying to warn and prevent are ridiculed, the only thing that will remain in the end will be regrets.
The entire Western economy is a controlled demolition, and there's not a gahdam thing we can do about it. Sit back and watch it burn.
Make no mistake. Once the predators-that-be and predator-class (banksters) have raped the Cyprus gold and everything else of value that can be moved, they will kick Cyprus out of the euro [and eurozone].
People of Cyprus. Wake up! Leave the euro and eurozone before you are COMPLETELY raped by the predators. They've already royally screwed you, but they ain't finished yet. Kick them out! Go Iceland!
and where does this BS come from? "they will kick Cyprus out of the eurozone"? do you realize what you are writing?
"Go Iceland"? The Cypriot government does not want their two big banks to fail, remember?
It was a bit out of left field, wasn't it? But we all misread the play sometimes...
I agree with you: There is no way that any "country" will be permitted to leave the eurozone, let alone be kicked out of it!!
German party wants Deutsche Mark comeback
http://www.youtube.com/watch?v=jE9B5vvVyy4
That is probably a good idea, and the ultimate end result. I envision some scheme that has a Northern and Southern Euro concept. That will ultimately fail, and I'll be able to trade my old deutschmarks at a premium.
No one has dared mentioned it in their comment, but Europe behind the scenes has been threatening Cyprus with no assistance against any Turkish provocation should they not tow the line.
The gutless politicians are not willing to take the dare, so Cyprus will well and truly be hung out to dry, stripped of any offshore wealth, be riddled with British and NATO bases and then left to declare bankruptcy and exit from the Euro.
The German government however has a surprise coming. They have a superiority complex but they also know deep down that all of their illusions of conquest have ultimately failed. And fail they will again.
Isn't this like the fried egg talking about leaving the frying pan?
Frits Bolkestein former Dutch politician from the right wing party and European Commissioner:
“The strong (Northern) Euro countries must create a quality parallel currency to the euro” (google trans from Dutch) http://tinyurl.com/c3vs3cm
ORG http://www.volkskrant.nl/vk/nl/2686/Binnenland/article/detail/3423694/2013/04/11/VVD-er-Bolkestein-80-wil-parallelle-munt-naast-euro.dhtml
Frits Bolkestein 11 April 2013 : From 15 September 1999, until 22 November 2004, he was the European Commissioner for Internal Market and Services. In the European Commission, Bolkestein was responsible for internal market taxation and customs union issues. Some of the more politically sensitive items in his portfolio were the draft community patent regulation and the draft directives on the patentability of computer-implemented inventions and services in the internal market, the so-called “Bolkestein Directive”, which has become the focus of heated debate. http://en.wikipedia.org/wiki/Frits_Bolkestein
There’s no debate between freedom and non-freedom. Why would this be a difficult decision? Yes, there may be tough times ahead for Cypriots, but there can be good times ahead if Cyprus is sovereign and makes its own decisions.
If Cypriots choose non-freedom, i.e., to stay in the euro zone, the tough times ahead will only mean that in the next round of recession and difficulty, they will be facing a Troika with even less sovereignty than they have now and the Troika will exact an even greater price.
The Pilgrims chose freedom and underwent hardships for their decision, but the outcome was the beginning of one of the planet’s major miracles. With Cyprus, the citizens can choose independence without even firing a shot to force independence; all they have to do is walk away.
The handwriting is on the wall. Just two words were the signal that the complete loss of free and sovereignty was coming; and those two words were “capital controls.” Those words say we own everything you have; you have made a pack with the devil.
But as I remember the Devil gives you something in return when you make a pact. These guys don’t give you anything. In “Damn Yankees” Joe was to get a winning season out of it…and Lola!
i know shotguns have rather short range but.....
I am thinking back to the Bandung conference of non-aligned nations in the1960's. If Cuba sold its sugar thru Cyprus? And cigars? If Iran would sell oil to Greece and Cyprus (and later Spain and Portugal)? If Venezuela could also be persuaded to extend oil credits to Cyprus? There are formulas and solutions out there but one must think creatively. The NATO bases are an obstacle. Still everytime that Italy brings up sovereignty issues with the Vatican they scream "Lateran treaty,1925,signed by Benito Mussolini!".This is not a historical precedent to be proud of.It is just above the Inquisition in ethical stature,but not much. When anyone suggests the Yanks get out of Gitmo,they scream "Well where do we stop,scrap every treaty?" Same thing. The Americans hate giving up bases unless they are under ten feet of volcanic ash (Clark Air Base,The Philippines). For someone who was living in a cave for the last ten years,it would seem that the world economy is undergoing an enormous transition.This was caused by debt and leverage and now they are trying to re-inflate the bubble by money printing (currency destruction). I would submit that the Cypriot people are justified in charting a new course for their country,and that all options are now on the table. Fresh elections,fresh leaders,and fresh ideas. And yes, Iceland looks like the preferred course,and not Ireland.
I'm thinking back to last september.
Ewald Nowotny ran his mouth. Then Mario Draghi ran his mouth, a month later.MOAR people are being pillaged! WTF?
this all going to boil down to food, the new reserve currency.
I can't believe it's a debate at this point. Hell yeah they need to get out, preferably before they ship all their gold.
The Rothchilds are licking their chops.
It aint the money, which is fake anyway. It's the energy. It's the oil.
sigh... talking to plant life.
I think the whole debate is being argued ass over tit......really its #germany that should be kicked out of the #euro, not the likes of #cyprus, #greece, #italy, #spain , #portugal.etc..... ( the fact that this is a long list tells you the problem ) The soutern tier and a bunch of others are relative economic midgets, and its unfair of Germany to expect them to adopt its standards. Germany must pay " the price" in terms of a very strong currency, and the rest can live with a nice weak #euro. #German highhandedness will bring this whole edifice down. Basically the message from most of #Europe needs to be " fuck off Germany, go play in a sandbox on your own "
"Only once these options have been comprehensively investigated and reports prepared by experts can there be a proper debate on what must be done and an informed decision taken."
HA!!!
It was reports by experts that got you into this mess in the first place. Better to hand the decision over to the corner grocer and fish monger.