The plan "is an exceptional and unique case, which has been exceptionally applied to Cyprus," Spanish Prime Minister Mariano Rajoy told a press conference at the Elysee presidential palace.He may be lying.
Olli Rehn, The EU Commissioner for Economic and Monetary Affairs warned that more Cyprus-style bailouts could be needed.
Matt Basi, head of sales trading at CMC Markets, told MailOnline: 'The general perception is that were Europe to take another turn for the worse, they (Spain and Italy) are the two largest economies most susceptible.'Now, as all this was going down, I wondered why Russia was being so quiet. I fully expected the Southern Fleet to take up a station off the coast of Cyprus. After all, many people know the old warning:
He added: 'This (Cyprus) bail-out is a potential template for other bail-out packages.
- You don't screw around with Mother Nature,
- You don't screw around with Mother-in-law,and
- You don't screw around with Motherf---ing Russians.
But it appears that Zerohedge has figured out why the Russians are so quiet. In this column, Tyler Durden quotes a Reuters report:
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.He goes on to opine:
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...Get your money out of banks. Now.