On Saturday the EU mandated that all bank deposits in Cyprus pay a 6.75% "stability levy" on the first €100,000 and 9.9% on the excess
to help pay for €6 billion of the €10 billion bank bailout.
This is despite opposition from the Cyprus finance minister, who stated earlier this month that "there really couldn't be a more stupid idea"
and more recently that "I wish I was not the minister to do this"
. The scale of the bailout is nearly 50% of Cyprus' entire GPD, and many officials are concerned that the money will go to Russian gangsters and oligarchs.
The Saturday announcement lead to a run on the ATMs
, which caused banks to restrict electronic transfers and set a €400 withdrawal limit. Most ATMs were out of money by the end of the day and a frustrated man threatened one bank with a bulldozer
The plan was scheduled to be voted on by parliament on Sunday, but it has been delayed to Monday
and might not be passed by politicians who have heard complaints from their Cypriot constituents all weekend. The Cyprus President warned of total financial collapse and euro exit if it is not approved
Greek Crisis Exacts the Cruelest Toll.
'Two years into Greece's debt crisis, its citizens are reeling from austerity measures imposed to prevent a government debt default that could cause havoc throughout Europe.' 'The most dramatic sign of Greece's pain, however, is a surge in suicides.' 'Recorded suicides have roughly doubled since before the crisis to about six per 100,000 residents annually, according to the Greek health ministry and a charitable organization called Klimaka. About 40% more Greeks killed themselves in the first five months of this year than in the same period last year, the health ministry says.' [more inside]
Yields of 2-year Greek government bonds have been skyrocketing today, and are currently at 76%
. Credit default swaps show Greece with a 98% chance of default
. Confidence in the Eurozone as a whole has been tanking
recently after a series of setbacks that leave a political solution looking increasingly unlikely. There was a timely, gloomy discussion on RT
yesterday on European and worldwide political/economic prospects
Starting last month, the French daily Le Monde
has been publishing an economic thriller in series, called Terminus pour L' Euro
(in French) (The End of the Line for the Euro). The series is behind a subscription wall, but Presseurope has started republishing the series in ten languages, including English
The story narrates the events of summer 2012, as Germany decides to leave the Euro and what follows. It has caused a stir in France, as rumors about the true identity of the author (who signs the series as Philae
, after an island in Egypt apparently) continue to circulate, and some think he is the French agriculture minister Bruno Le Maire
. Some say
that the rumors that led to the precipitous fall
in French banks' stock a few days ago, were due to misunderstanding the fictional character of the story...
that Germany threatened to leave the Euro last year, were dismissed by its Chancellor
, yet as the eurozone crisis develops, no one is certain any more that the series is simply fiction and not a possible, real scenario, advocated