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Cyprus Parliament To Vote On Bail-out After All: Fire And Brimstone Threats Begin
When the final "bailout" structure of the Cypriot deposit-confiscatory bail-in was revealed in late March, the implied victory for the Troika (which has since notched up its demands for the insolvent country to now sell its 14 tons of gold) was that instead of the deposit haircut passing as a tax, and thus needing a parliament ratification, it would come in the form of a bank resolution, with Laiki bank liquidating and being subsumed by the remaining Bank of Cyprus, and with uninsured depositors in both banks ending up crushed. However, as previously reported, in the interim period deposit outflows have continued and accelerated despite the assorted ineffective "capital controls" which has led to additional underfunding for the local banks, and to a second bailout of Cyprus, this one rising to €23 billion or a 35% increase from the original, as part of which the Troika has demanded that Cyprus sell their gold in the open market. Now, a month later, it appears that the Troika's initial victory may have been a Pyrrhic one, as yesterday the Cypriot attorney general announced, and today the government's spokesman confirmed, that the parliament will have to ratify the €23 billion bailout of the tiny island nation after all, thereby refocusing the popular anger from some ephemeral technocrat in Europe to the country's own elected representatives, thereby changing the calculus of the Cypriot decision by 180 degrees.
Cyprus‘ parliament must ratify a 23-billion-euro (30.3 billion dollar) international bailout deal in order for it to become valid, government spokesman Christos Stylianides said on Wednesday.
"It is not possible that Cyprus‘ bailout deal needs to secure the approval by other parliaments in the eurozone, while at the same time it is not voted on by our parliament," Stylianides told state radio RIK.
"It looks like the parliaments of the other eurozone countries will pass it and we will now see what ours will do. I hope that the legislators will vote with wisdom and responsibility - I have this expectation," he added.
Naturally, since the fate of the country's freedom from the European neo-feudal regime, and potentially the future of the Eurozone itself, is suddenly once again where it never should be: in the democratic hands of the majority of the "great unwashed", the threats of fire and brimstone have started already. Here is Stylianides with his best rendition of Hank Paulson:
"Anyone who is ready to vote against the loan agreement should at the same time be prepared to come up with 10 billion euros needed to continue to pay salaries and pensions."
One word here: Iceland. But we are confident that by now even Cyprus' population, which has stoically absorbed everything from deposit haircuts to the upcoming forced gold sales, is familiar with what the only success story in Europe to date has been, and why.
So what exactly will be voted:
The new vote will cover additional austerity measures drawn up by international creditors - the European Commission, the European Central Bank and the International Monetary Fund (IMF). The measures aim at downsizing the public sector.
EU Economy Commissioner Olli Rehn admitted that "mistakes" had been made "under enormous time pressure" in the initial decision to bail in small depositors, which prompted outrage and was rejected by Cypriot lawmakers.
On the other hand, mistakes were not made when as part of the European Commission's DSA, the following explanation of what is without doubt the immediate future for Cyprus:
In accordance with the Cypriot authorities policy plans, major financial institution will be downsized combined with extensive bail-in of uninsured depositors, and a set of wide-ranging temporary capital controls and administrative measures. The programme is envisaged to build the foundation for sustainable growth over the long run. Nevertheless, in the short run, the economic outlook remains challenging. Real GDP is projected to contract by 12½% cumulatively in 2013-14. Short-run economic activity will be negatively affected by the immediate restructuring of the banking sector, which will impact on net credit growth and by additional fiscal consolidation measures. Temporary restrictions required to safeguard financial stability will hamper international capital flows and reduce business volumes in both domestic and internationally oriented companies. The bail-in of uninsured depositors will cause a loss of wealth, which will reduce private consumption and business investment. This, compounded by the impact of fiscal consolidation already undertaken and new measures agreed, will result in a sharp fall in domestic demand. Little reprieve can be expected from exports amid uncertain external conditions and a shrinking financial service sector.
Cyprus had a choice to say no. It still does: probably its last one. If it once again opts to vote for a fate of Brussels-dominated serfdom, we can wish them is all the best on their uphill climb to a bleak, non-existent, hopeless future.
The vote is expected to take place early next week, unless delayed again. Choose wisely Cyprus.
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Stand and fight.
Remember (the Alalmo) Iceland.
One day, someone is gonna come into the temple and kick over the money changers tables, again.
I know just the guy for the job.
LOL - such a simple story, eh? bad, bad Troika wants to steal Cypriot gold
meanwhile Turkish Cyprus is claiming a share of the metal (Turks being notorious "barbarians") on the grounds that it was aquired at the times when the island was whole
and the Cypriot government had to acknowledge that it's not in it's power to sell it - it belongs to the central bank of Cyprus - do you really expect eurozone cb governors and Draghi's team to endorse a sell-off of Cypriot gold? then you definitely have understood nothing about the members of the ECB (as the recent Draghi+CypGold=sell! meme actually proves)
so the parliament will vote - but not on anything that has material impact on this "hoard"
meanwhile Barroso had a talk with Anastadiades where the EU will try to frontload EU payments to Cyprus
in Iceland, people were on the street to protest against the bank's bailout
in Cyprus, bank employees were on the street to protest against the terms of the bank's bail-ins
a small but imho important difference
but go on with this "neo-feudal" story of "debt-serfdom" to "Brussels", it seems to strike a chord... somewhere else
I like reading your comments, even though I think that the Cyprus is an perfect example of the double standards that have always existed in Europe. Iceland and Cyprus have lot in common, but the way EU treated each of them could be hardly more different.
I was actually not finished with it! ;-)
the rest: meanwhile this gem reminds me why I like the Tylers, even when I foam about their prejudices: "the parliament will have to ratify the €23 billion bailout of the tiny island nation after all, thereby refocusing the popular anger from some ephemeral technocrat in Europe to the country's own elected representatives, thereby changing the calculus of the Cypriot decision by 180 degrees"
isn't it jolly how much europolitics depends on the capability of blaming everybody else and "Brussels"? LOL
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I'm not sure I understood you: your point is that Iceland was treated fairly and Cyprus not?
I remember the British Government immediately bailing out the customers of Icesave and than immediately proceeding in pressuring Iceland to take over and put it on their sovereign debt - hardly fair, in my book
meanwhile Cyprus's team behaved in a completely different manner, engaging in various bazaar techniques, asking for way more than 10bn in order to bail out their banks (their wish) and lying, lying, lying, running to London and Moscow with shady side-deals, etc. etc.
this mess should have been solved by December 2012 - but politically the old team preferred to shift the burden to the new team
but I am writing way too much - I have my doubt about a great interest in details, so perhaps I should ask in what manner has the one island been treated better or worse than the other - keeping in mind that they asked different things from the EU partners
I am pointing out that they were treated differently, and the reason for this difference seem to be mostly in that there was nordic country and mainly british and dutch customers in one case, and southern country and mainly russian customers in other case. I believe that the Icelandic population enjoyed the fruits of the financial innovations by their banks just as much as their Cypriotic counterparts.
Where was the pressure by the EU to punish the customers in the Iceland banks, the way they pressurised for the punishment for the customers in Cyprus?
Iceland's banks went broke if memory does not fail me. I don't have the numbers but I definitely remember lots and lots of customers losing everything. except for those bailed out by the UK and the Netherlands
meanwhile in Cyprus - and it's not over yet - it looks like only big cash accounts (over 100k) are getting a "haircut" and the other countries are helping with 10bn - which is 10'000 EUR per Cypriot
yeah, the Russians. they are imho ambivalent, then their interest is actually to get this tax-heaven money back in their economy, paying taxes
Iceland wasn't in the Euro at the time of default. They had their own currency. They applied in 2009.
your memory is very good, but I think there was eventually a bailout for Iceland, although with far less demands ( maybe the Iceland has little Gold).
I wish EU population good, but it always seem to me that some animals are more equal than the others in the EU.
All bank depositors in Cyprus will take a haircut, and a big one, since loans by the ECB take precedence over everything else. Once those have been repaid, and allowing for the money already withdrawn and the losses the Cypriot banks have taken on their Greek bonds (in order, again, to protect the ECB and other government lending to Greece), there will be nothing left to pay the depositors.
Re that wonderful 10bn euros the EZ is supposedly lending Cyprus, no actual cash is going to Cypriots. It is simply circular lending to repay loans previously made by the banks and the ECB to Cyprus and its banks, and for which all future Cypriots are then to be made liable. The ordinary Cypriot gets zero benefit from this self-serving "largesse". They just get their existing assets and future earnings encumbered for the benefit of those who are allegedly helping them.
Love the pic but one wonders exactly where the Cypriot gold is?
my guess is London. after all, Cyprus used to be a British Dominion
It used to be a Templar "dominion" as well...until they, like the Brits, found it more expedient to devolve the tenacy elsewhere, and merely maintain their useful bases. In fact, I believe it was the French that they offloaded it onto!
As much as I admire your willingess to perform the role of rearguard at each ford from which the forces of URO-fascism fall back in short order now, the outflanking is getting easier every day...because of your insistence on having it both ways....
eg.- the constant assertion of the role of history and traditions in guiding and distinguishing the continentalist passion...at the very same time as denying every scrap of very historical evidence of the planned [d]evolution of the project into a 'neo-feudal' nightmare*
The timeline to which starts(in the modern context)with the infamous COUNT COUDENHOVE KALERGI and his Pan-European Austrian-Jesuit tendency, of which we still suffer the remembrance in the name of one of the many awards that the new Patrician class in Brussels give themselves: I believe VonRumplestiltskin received not too long ago!
It's long overdue that we get into rolling up your remaining reserves, Marchal Ghordius! I'm simply awaiting you and your erstwhile "man at arms\dogsbody" to show up here with some ridiculously disproportionate defence of the indefensible and unfeasible....
and we wil be charging with the Heavies, right at your vulnerable CC-K centre! Fair warning...and best wishes!
*whilst you may be technically correct in disputing the 'neo-feudal' nature of the beast, that is some hair-splittin which I believe will cost you considerable energy and assets to defend...but pls feel free! Your erudite etudes are always enjoyed...even when erroneous!
joyful, I understand you know Cyprus. isn't it painful to see what is happening? I strongly suspect that you, too, find the article painted with a too broad brush
perhaps I put too much weight on the "continentalist" view, yes. but look how Draghi's comment (paraphrased) "that gold ain't the gov's to sell, it belongs to the CB" has been used for the "europe is selling all it's gold" propaganda, lately
Yeah, turns out this is actually pretty damn important. The Greek situation is inextricably linked to Cyprus; Greece suddenly becomes a huge problem again if Cyprus defaults.
Contagion, bitchez.
All your gold are belong to us!
See that dot in the rear view mirror Cyprus? That was your freedom.....
And you see that deer that your about to hit, which will total your car...
That's the European Union.
That deer is a massive wall!
See that dot in the rear view mirror Cyprus? That was your freedom.....
It did appear closer than it actually was.
no taxation without representation bitchez.. it's what revolutions are fought for don't you know.
Yawn. They wouldnt let it come to a vote unless they were sure it would pass.
I don't know if they can stop the vote. But I'm sure there will be much scaremongering and delegations sent to Cyprus to warn everyone to stay on the sinking Euro boat or ELSE!
I do hope they behave bravely and vote against it. Of course, they will need to vote against it maybe 3 times as these kinds of anti-Euro votes tend to get repeated until they have the correct result. I don't have much hope as in the meantime, the shocking market plunges to near-all-time-highs will scare them all to selling out their people and gold.
One of the steps toward freedom, is to realize the solution to debt is not more debt.
And of course, this news provides great comfort to all who are dumb enough to still have money in cypriot banks. Anyone not finding any possible way to suck those accounts dry regardless of balance is a fool.
Does Calculus change by 180 degrees?
Seriously, I never got past Algebra 2 amd then Tax which I consider to be about the same thing.
They are just sheep. Sheep deserve to be slaughtered. That's just the way it is.
When does the guillotine show up?
Would a golden guillotine be ironic?
So waht happens if they vote no?
Usual EU modus operandi would be to let them vote over and over again until they vote yes.
Why is there even a vote? Just tell the fuckers to fuck off.
Oops double posted. Slow ass verizon service.
Since politicians are in servitude to the banks, I am certain that it will pass.
Does Cyprus actually have physical gold or has that already been stolen. No vote on bailout will be teling.
It's all game, but there are real solutions, they just have to out-bankster the banksters...
http://www.zerohedge.com/news/2013-04-12/cyprus-central-bank-shambles-fo...
THIS IS CYPRUS!
THey should just leave the euro , their own currency was better, cyprus was rich before the euro, then the euro came in and everyone lost their shirt.
The Coup d'etat has been reversed. Stand by for a re-Coup d'etat.
<And the Cyprus politicians thought they had missed the slings and arrows when they were initially bypassed.>
I prefer to wait for de couple-de- tatas. ;->
As Mrs. Cog would say, "Clearly you're a male". :)
A patient shows up to his psychiatry appointment wearing nothing but a few wraps of cellophane. The doctor says, "Clearly I can see your nuts."
Not necessarily.
hmmmm, tatas
Save the tatas.
I have a bunch in my closet in mason jars.
And the people of Cyprus, like the Spartans before them, became mythic heroes for fighting the marauding invaders to the death.
Should the muppets in the market sell gold ?
Sacksman Gold told 'em so: http://www.zerohedge.com/news/2013-04-10/goldman-buying-gold-selling-tre...
I am sure many new Swiss banks accounts will be opened this week by the rulers to accept payments for their votes by the EU....or to accept the 1.3 tonnes of gold that will not be sold...that excess crap....or so they say....
Its a very small island and they all live there.Would be a brave politico that takes a bribe.
We all know that brave politico is an oxymoron.
Some one grow a set of nuts somewhere...
One thing I have learned in the past 4 years throughout the number of votes, votes for a referendum, political elections that would release the shackles of debt servitude it is that when it comes to the bankers vs the people the politicians will 100% of the time vote the way the technocrats desire. And if it first it does not succeed or go according to plan they will change the rules like they always do.
That along with they will increase any bond buying fund, change whatever accounting rules necessary, suspension or delay of implementation of accounting rules, convenient margin hikes and perpertual ZIRP. There will never be a rate hike again in the U.S. and if there is it will only be for 6 months to a year in order to allow the fiction economy to implode and then we can have the Fed relaunch QE & ZIRP in order to "save" us. And that is how the game works. 2008 showed us that the economy could not exist on even a 4-5% interest rate.
The game is over..we know it and they sure as shit know..were just waiting for someone to blow the fucking whistle.
I think it is the government who cannot exist on a 4-5% interest rate...the economy would be able to stand it, if the government would just get the fuck out of the way.
They have no choice but to vote yes, it's the best chance the politicians have to remain in power. IF they vote no the enchilada collapses and they'll have power over nothing, a vote yes keeps the can kicking along.
Yea Cyprus!
They be irken' the merkel.
they are playing it all wrong. they should provisionally agree to the demands then remove capital controls so that uninsured depositors can reduce their deposits and only then hold bailout ratification vote and vote the bailout down. short of this type of approach this is meaningless
Wish Banzai could do video montage of the threats of DOOM that cyprus will have to endure - a little Paulson and Timmay et al.
Iceland. It needs repeating, over and over again.
Trade and current account balances matter ... Iceland could do what it did because it had a functional economy.
Cyprus needs a bailout because it's economy is completely and utterly fucked.
I believe the point is: They are not bail-outs.
They are cash-out refis intended to prevent the citizens from realizing how corrupt the system is by masking it with more credit and also preventing the bankers and elected officials from losing thier jobs. Additionally the bail-outs are to ensure that the cash stream to deutchbank flows - so really this is about the tax payers bailing out the banks of the eurocore.
Has little to do with the state of the cyprus economy other than a downturn has exposed the pozi M-Fers.
Ice-Pick 'em!
Barroso verspricht Zypern hinter Schäubles Rücken mehr Geld
Barroso promising Cyprus more money behind Schäuble's the back - what a bunch of crap.
"......Human sacrifice! Dogs and cats living together!....MASS HYSTERIA!"
http://www.youtube.com/watch?v=9S4cldkdCjE
No European politician with a moral backbone would have anything to do with the EU or the EZ. Both are unmitigated disasters that have only served to embellish the selfish career fantasies and cronyism of unelected socialist elites in Brussels (Barroso & Co) and elected political parasites across member states.
Cyprus has the opportunity next week to vote against this bail-out/bail-in Troika racket. If its members of parliament vote FOR it, the nation only has itself to blame for what will surely follow. It will get no more sympathy from me.
There are times when people have to stand up and be counted. For Cyprus, this is their moment.
"Cyprus has the opportunity next week to vote against this bail-out/bail-in Troika racket. If its members of parliament vote FOR it, the nation only has itself to blame for what will surely follow. It will get no more sympathy from me."
...
I suspect this vote has more to do with managing psychology than presenting an actual opportunity for choice. Consider what they are voting on:
So what exactly will be voted:
The new vote does not cover the original terms of the bail-ins, but appears to merely be targeted at measures toward "downsizing the public sector." The key will be in the actual terms of what "downsizing the public sector" means... if they write the terms such that "downsizing the public sector" is not too painful, the vote will surely pass.
If they can assure a passing vote, they accomplish two things:
1) As you state, the sympathizers throughout the world towards Cyprus will be less likely to sympathize, and understandably so. The perception will be that they voted for their own situation, which changes the dynamics completely.
2) The Cypriot people will believe that they have been given a choice, and will be less likely to rebel against Euro participation. "Democracy" in action.
The added benefit to the Troika is that the blame and ire about this will be re-directed from the Euro technocrats to the local politicians. As Tyler phrases it, "thereby refocusing the popular anger from some ephemeral technocrat in Europe to the country's own elected representatives."
Surely a vote would not be allowed unless it has been carefully wordsmithed and crafted to 'win'. And as some here have already pointed out, if at first you don't succeed, vote again.
I think EU politicans is a lot dumber than they think they are. That might be their plan, but they have no knowledge about local politicans. They might vote no just for the heck of it.
They were wrong about the last bailout terms. They might be wrong about this one too. I don't think local politicans want to vote for anything, because any party that chooses to vote no will gain massive popularity, and the parties who vote yes will be hated.
If they vote no, it will be interesting to see what happends. Will EU bypass the Cyprus parliment again? Or will Cyprus leave the euro?
Cyprus has the opportunity next week to vote against this bail-out/bail-in Troika racket. If its members of parliament vote FOR it, the nation only has itself to blame for what will surely follow. It will get no more sympathy from me.
Remember it is the politicans who vote, not the people. If the people could vote, Cyprus would leave the euro. I really hope the parliment in Cyprus does the right thing, and give EU the middle finger. I think they might vote no, because they didn't vote yes last time, and the terms are much tougher.
Cyprus does not need the bailout. The total cost of the bailout was supposed to be 17B with EU paying 10B. Cyprus is already paying 13B and not defaulting on any debt. EU is just blackmailing Cyprus, and will suffer much larger losses if Cyprus leaves.
Wait, didn't they already get the bail-out cash though? Wow, how awesome would that would be to stick it to the EU now? "Oh sorry, bail-out money has been spent as well".
They will vote to steal
The problem is what will Cyprus do for international money if they vote to get out of the EU. It is not like they have resources except some claim on unproven natural gas. The island can grow some few crops, have a good dark wine, but no way to pay for fuel, autos, trucks. Their 'new' money will not be worth much. Life's a bitch then you marry one.
Oh BTW: Though the concept 'Sparta' was Greek, those dudes are not the ones there now.
My first post on ZH, Good day all!
I live in Nicosia, the capital of Cyprus, and am reasonably well versed in financial matters. Watching matters unfold over the last month has been an unbelievable experience as economically, finacially and mostly common sensically illiterate politicians and bureaucrats from the EU and Cyprus mismanage vitally important decisions.
This is from both sides, because a Cyprus default and departure from the Euro is increasingly attractive to people here as the terms change on an almost daily basis and are seen as punishingly harsh, and for the EU the death knell for the whole shambolic farce could come into play when one member - however small and insignificant - calls the whole edifice as a sham.
This posting file:///C:/Users/User/Desktop/Market%20Daily%20Briefing.webarchive which has been on ZH before is starting to circulate in Cyprus, and is damaging. That Cyprus could be used in such a way is quite disgusting, and the concept of 'Solidarity', trumpeted by the Barroso's and van Rompuy's is completely trashed (as it doesn't exist in any case).
I'm advising all of my clients to move any Eurozone deposits out - when the Eurogroup announces openly that "your money is now our money whenever we want it" what the hell else are you going to do?
I seriously think that the Eurogoup has initiated the end-game for the Euro and the EU. Hooray!
Me, I left E 60.00 in my Cyprus account, they're welcome to it - a fine contribution to the demise of the €!
Germany owes Cyprus a large sum.
Check out how they have avoided paying it;
http://www.germanywatch.blogspot.co.uk/2013/04/germany-is-in-default-and-lies-about-it.html
Conveniently for the prospective vultures/buyers, Cyprus' gold is much cheaper this week.
"... the Troika has demanded that Cyprus sell their gold in the open market". Anyone else notice the gold price dropped dramatically this last week, even before the sale? Can't think why...
Cyprus debt is about $20B dollars. Thet is a lot more than the bailout.
So my suggestion is this, just default on the public debt, default on foreign depositors, leave the euro and start printing to cover the deficit.