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Current goings on in Cyprus

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Pretty sure most of us are up to date on the current financial goings on in Cyprus. If you aren't you can check out these links to get caught up..

 

http://www.theblaze.com/stories/2013/03/26/the-crisis-in-cyprus-bank-shutdown-goes-into-second-week/

 

http://www.theblaze.com/news/cyprus-tax-plan/

 

 

 

 

And recently there have been talks of the same sort of deal for Spain, Italy and other EU countries..

 

http://www.telegraph.co.uk/finance/financialcrisis/9952979/Cyprus-bail-out-savers-will-be-raided-to-save-euro-in-future-crises-says-eurozone-chief.html

 

 

 

Since the topic hasn't really been covered by the U.S.'s poor excuse for a media, I wondered what you over in Europe thought? I know we have a few members from the EU, so thoughts? are you not worried at all? are you pulling your money out of the banks?

 

 

Anyways just a interesting topic.

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The TV in the reception area at my office is set to show CNBC all day. I saw something about "Cypus bailout" quicky today but that was the first I'd heard of it. Thanks for the additional info.

 

So, it would seem as though another member of the Eurozone is now going through some financial throes. How many countries can possibly be bailed out before the people bailing them out run out of money? This whole mess is just nuts.

 

Well, at least it's good to know that there are countries with worse problems than US...

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  • The TV in the reception area at my office is set to show CNBC all day. I saw something about "Cypus bailout" quicky today but that was the first I'd heard of it. Thanks for the additional info.

     

    So, it would seem as though another member of the Eurozone is now going through some financial throes. How many countries can possibly be bailed out before the people bailing them out run out of money? This whole mess is just nuts.

     

    Well, at least it's good to know that there are countries with worse problems than US...

     

     

    Not sure how far you read, but this particular bailout has one giant stipulation, the IMF (international monetary fund) has required that any bank account in Cyprus that has more then $130,000USD or more then 120,000eu will automatically have 30% pulled out. 

     

    Thats 30% of business bank account and private banks accounts.. At what point do we start calling this what it is? stealing!?

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    The problem is that the Cypriots themselves didn't cause most of it. It's Iceland all over again but instead of Dutch, English and Germans putting all their money in unstable banks, it were the Russians. I read that one third of the money in banks on Cyprus is/was owned by Russians, and most of them also had a home on Cyprus. This also explains why initially Russia wanted to help with saving Cyprus. But when it became obvious the EU was going to save them, the Russians got out again and now the Eurozone has to force Cyprus into inhumane budget cutting procedures just to pay back the Russians. Contrary to the EU's tries to save other countries, the money won't flow back into the EU or financial institutions of its member states this time. All of this at the expense of the common man.

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    ince the topic hasn't really been covered by the U.S.'s poor excuse for a media, I wondered what you over in Europe thought? I know we have a few members from the EU, so thoughts? are you not worried at all? are you pulling your money out of the banks?

     

     

    Anyways just a interesting topic.

    Not worried at all. The EU guarantees savings up to a 100.000 euros. Besides, this is not the standard approach to saving the Eurozone. They did it with Cyprus because it is a very small country and a very small economy, the risk of contagion was minimal and the Cyprus banks have earned a lot of their money from Russians who have some shady financial records as well as companies and individuals who used Cyprus as an off shore tax haven. I can understand that the EU and to a larger extend, the law abiding tax paying citizens do not want to pay up billions of euro's so the Russians and tax evaders don't lose all their money. 

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    No matter how you spin it, this is the thin edge of the wedge of using confiscation of personal capital to bail out the failing monetary system.  This is the kind of thinking that eventually can cause the collapse of the Eurozone.  If other major economic groups took the same attitude, there will be a general run on the banks world-wide.  This will result in a world-wide crash and depression.

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    No matter how you spin it, this is the thin edge of the wedge of using confiscation of personal capital to bail out the failing monetary system.  This is the kind of thinking that eventually can cause the collapse of the Eurozone.  If other major economic groups took the same attitude, there will be a general run on the banks world-wide.  This will result in a world-wide crash and depression.

    The alternative is to use honest tax payer money to ensure that (Russian) tax evaders can keep their money. Im sure that will go down well with people. 

     

    Besides, they only did it like this BECAUSE the majority of the money the banks there had was tax evasion money. On top of that, they made bank runs impossible. People there can only draw a limited amount of cash from their banks per day for the next couple of months until things have died down a bit. Of course, the economy of Cyprus gets hit hard. But again, they did it like this because the economy of Cyprus on the whole is pretty much irrelevant to the rest of the Eurozone. It is like 1% of the total Eurozone GDP. Again, they would have found another solution if the economy was much bigger. 

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    So now, because of the stupidity of the banking sector in Cyprus, you want to make Cypriots second class citizens? 

     

    The EU has no business whatever in considering the source of the funds they are grabbing.  Clearly the Cypriot government needs a general shake-up, and the citizens should not get off scot-free because they complaisantly elected a set of hoods and boodlers.

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  • So now, because of the stupidity of the banking sector in Cyprus, you want to make Cypriots second class citizens? 

     

    The EU has no business whatever in considering the source of the funds they are grabbing.  Clearly the Cypriot government needs a general shake-up, and the citizens should not get off scot-free because they complaisantly elected a set of hoods and boodlers.

     

     

    Agree with both of your post completely Moose.

     

     

     

     

    @Lexus

     

         Don't forget that the IMF is now considering these same actions with Spain and Italy... so its not just "corrupt Russians" that they are getting.

     

     

    And a second point, do you think these Russian billionaires will let this go un-answered? imagine if you had a billion in the bank and boom over night 300-400 million of it disappeared... pretty sure you would do what it takes to get that back.

    AND considering the EU gets most of its oil from Russia, how do you think this will end up?

     

    I think this was a very scary move by the IMF, and if anything happened like this in the U.S. I know probably half the country would be marching on Washington with guns in hand.

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    So now, because of the stupidity of the banking sector in Cyprus, you want to make Cypriots second class citizens? 

     

    The EU has no business whatever in considering the source of the funds they are grabbing.  Clearly the Cypriot government needs a general shake-up, and the citizens should not get off scot-free because they complaisantly elected a set of hoods and boodlers.

    No, the majority of normal savers do not get touched by the measure. In fact, the measure only affects the two biggest banks on Cyprus, all the other banks remain untouched. The majority of people affected by it are rich Russians who used Cyprus as a way of avoiding Russian taxes. The EU is not there to save these peoples money with taxpayer money. 

     

    Lexus

     

         Don't forget that the IMF is now considering these same actions with Spain and Italy... so its not just "corrupt Russians" that they are getting.

     

     

    And a second point, do you think these Russian billionaires will let this go un-answered? imagine if you had a billion in the bank and boom over night 300-400 million of it disappeared... pretty sure you would do what it takes to get that back.

    AND considering the EU gets most of its oil from Russia, how do you think this will end up?

     

    I think this was a very scary move by the IMF, and if anything happened like this in the U.S. I know probably half the country would be marching on Washington with guns in hand.

    First of all, no, the EU or the IMF is not considering this for Spain and Italy. The guy who said it made some very stupid comment and he immediately got called back for it by pretty much everyone in the EU. Of course, his comments have set off some speculation by others who now think the EU is out to get everyones money, which is just utter nonsense. 

     

    And whether the Russians let it go unanswered or not is irrelevant. These Russians that lost money were generally criminals, who got their money in unlawful ways or who avoided Russian taxes. If they want something from the Russian government, they will have to admit first that they were dodging taxes in Russia, or admitting some other crime. Second, we get gas from Russia, not oil. We pay a whole lot of money for that gas, more than any one else is willing to pay. The Russians can close the valve, and hurt eastern Europe with it, but they would not stand to benefit from it. Of course, the Russians do not like this, but I don't think they will do anything drastic. 

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    Not sure how far you read, but this particular bailout has one giant stipulation, the IMF (international monetary fund) has required that any bank account in Cyprus that has more then $130,000USD or more then 120,000eu will automatically have 30% pulled out. 

     

    Thats 30% of business bank account and private banks accounts.. At what point do we start calling this what it is? stealing!?

     

    That is blatant stealing of people's assets and it will be destructive in the long run since if it becomes acceptable to confiscate bank account assets for bailout purposes, then it disincentivizes people from using the banks. You'll see people stuffing cash in their mattresses instead.

     

    Although, when I read about that I was under the impression that that money was being forcibly borrowed, not permanently taken. That is to say, the account holders will be repaid when the crises passes. Still, it's not right.

     

    Of course, you're a fool if you're storing that much money in a bank account to begin with. There are more productive ways to invest it.

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  • >snip<

    >snip<

     

    >Lexus

     

         Don't forget that the IMF is now considering these same actions with Spain and Italy... so its not just "corrupt Russians" that they are getting.

     

     

    And a second point, do you think these Russian billionaires will let this go un-answered? imagine if you had a billion in the bank and boom over night 300-400 million of it disappeared... pretty sure you would do what it takes to get that back.

    AND considering the EU gets most of its oil from Russia, how do you think this will end up?

     

    I think this was a very scary move by the IMF, and if anything happened like this in the U.S. I know probably half the country would be marching on Washington with guns in hand.

    First of all, no, the EU or the IMF is not considering this for Spain and Italy. The guy who said it made some very stupid comment and he immediately got called back for it by pretty much everyone in the EU. Of course, his comments have set off some speculation by others who now think the EU is out to get everyones money, which is just utter nonsense. 

     

    And whether the Russians let it go unanswered or not is irrelevant. These Russians that lost money were generally criminals, who got their money in unlawful ways or who avoided Russian taxes. If they want something from the Russian government, they will have to admit first that they were dodging taxes in Russia, or admitting some other crime. Second, we get gas from Russia, not oil. We pay a whole lot of money for that gas, more than any one else is willing to pay. The Russians can close the valve, and hurt eastern Europe with it, but they would not stand to benefit from it. Of course, the Russians do not like this, but I don't think they will do anything drastic. 

     

     

     

    Well first off, if I understand you correctly. You think its ok to steal money from people as long as the majority of those people are criminals? 

     

    And second, I honestly don't know how large Cyprus is, what the population is etc... but any legitimate business with 30+ employee's would have 120,000+ in the bank... Just to make payroll, this isn't just from private citizens its ALL bank accounts over 100,000.

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    Since banks and businesses have closed, would a temporary socialist policy take place to relieve the citizens in shock of such a sharp economic recession? If the government plans to divide the wealth amongst the citizens, it can better spend them to produce enough funds for a bailout, on condition that they switch to their usual democratic and capitalist policies, once their economy is running smoothly again.

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    Of course, we all know the real solution:  make the EU's Dutch and German taxpayers pay for the bailout of Cypriot banks full of laundered Russian money.  Well, formerly full of laundered Russian money...there are suggestions that even though the banks on Cyprus itself were closed before now allowing restricted withdraws, money is flying out of Cyprus though fully open branches elsewhere.

     

    In the end, someone will have to foot the bill.  Cyprus allowed its banking industry, operating as an offshore tax haven, to grow wildly outsized in comparison to the rest of the Cypriot economy, dwarfing by several magnitudes even the Cypriot government itself.  Apparently, those Cypriot banks were heavily invested in Greece, which is natural given the closely related modern histories of the two Greek-speaking countries, and when Greece imploded, those Cypriot banks were found to be especially vulnerable.  Remember during the Greek bailout debacle, much was made about making those inhumane creditor banks that held Greek bonds eat their loses, with riots in the street and rage posts on the internet against those big banks trying to protect the returns of the money they invested in Greek at the expense of the suffering Greek people.  Well, we stuck it to the banks, and among those creditor banks were Cypriot banks, which have taken horrible losses on Greek bonds for which they were banking would be fully honored, and which they needed honored to cover their own accounts.  Who would have thought that an EU state and a Eurozone member would not fulfill its own obligations?  Now, the Cypriot banks are in disarray, and as they are so much larger than the rest of the Cypriot economy already sagging with the euro malaise, even the already struggling Cypriot government itself cannot ever hope to cover them.  I see lots of blame to go around.

     

    So, who gets to be the lucky one to bail them out?  Whoever does is likely not going to see their bailout money paid back anytime soon, indeed, chances are it will probably never be repaid at all.  The EU and IMF offered partial funding of the bailout if Cyprus would cover the remainder...be it broad new taxes on the public or creative 9.9% taxes on bank accounts, already deficit-ridden Cyprus has to find the new money somewhere.  Reports are that even Russia's own offered bailout plans would have been worse...they additionally wanted Cypress to hand over the names and account information of depositors to Russia so that Russia itself could go raiding assets.  There is no way around it...there will be pain on Cyprus, or the banks there will collapse, and there will be even worse pain on Cyprus.  There is not going to be free money from international taxpayers with no strings attached, and when it comes to EU bailout funds, even those are still paid for by somebody.

     

    Personally, though their motives were understandable, I think the EU and IMF acted stupidly in suggesting their bank account raiding scheme, as that just scared people even more and created more Euro weakening chaos and resistance against what will already have to be costly and painful choices made in Cyprus.  The tens of billions being aimed at a Cyprus bailout, while a lot of money, is still a bargain for a multinational construct like the EU compared to the costs of allowing chaos and uncertainty to fester.  Where does this leave us:  tax hapless Dutch and German taxpayers more so that they can shovel yet more of their own money south to prop up the gross mistakes of others who don't want their own accounts to face a localized emergency tax.   However, even the Germans don't have bottomless pockets, and already their economic forecasts are sputtering dangerously due to the strains.

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    To comment on your first sentence, Odain, it will probably only be the Germans who can pay, because even though we pretend otherwise, the Dutch economy currently has the worst prospects of all the non-southern EU states. The inflation here is second highest in all of the Eurozone and the national debt is very high. The government is trying to save the budget by proposing all kinds of budget cuttings that will undermine our welfare state and education system, which will have negative results in the long run. But they can't do it because we haven't had a functional government for over a decade now and already they're trying to avoid new elections by trying to add other parties to the existing coalition, and the last elections were in September 2012... And there are problems with our natural gas extraction industry as well, because it causes earthquakes. The enormous reserves of gas have uplifted the Dutch economy for over half a century and we are completely dependent on it. The state will be bankrupt when we lose it, yet at the same time it can't just let half of a province sink into the ground.

    Other countries in the eurozone that have a stable economy and a functioning government are places like Finland, Luxembourg and probably Austria. Yet they lack the mass of Germany and don't matter enough. Unless someone thinks of a genius plan to save it all, the Euro project is doomed.

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    Well first off, if I understand you correctly. You think its ok to steal money from people as long as the majority of those people are criminals? 

     

    And second, I honestly don't know how large Cyprus is, what the population is etc... but any legitimate business with 30+ employee's would have 120,000+ in the bank... Just to make payroll, this isn't just from private citizens its ALL bank accounts over 100,000.

    And if I understand you correctly, you believe that once someone got away with stealing money by parking it on some offshore account, the rest of the world must refund that person when his offshore banks collapses? 

     

    And Cyprus is small. About a million people living there in total. The total GDP of Cyprus is like 1% of the total Eurozone GDP, so again, it is an insignificant little place. They build their economy by providing services much like how they did it on Iceland, and then when the bubble burst, the rest of us can come in and bail them out because they screwed up big time. But hey, if we want to hold them accountable to some extend for the mess they made themselves, we are the bad guys, because how dare we steal all that money! If we had not done anything, all their banks would have collapsed, and everyone with more than a 100.000 on the banks would have lost their money just as well. 

     

    But is this bad for the economy on Cyprus? Yes, it will take a massive blow. Sadly, when you build your economy based on bubbles and the bubbles burst the economy will collapse, no matter the bailouts you send their way. One can only hope that the people on Cyprus take this as an opportunity to rebuild their economy from the ground up, and this base it on more stable and sustainable sectors. 

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    "Thou shalt no steal" - Mosaic writings of some 5000 years ago.

     

    When the level of theft rises to the national and international level, what kind of sin is this?

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    Since the topic hasn't really been covered by the U.S.'s poor excuse for a media,

     

    Here's a list of articles posted by the U.S.'s supposedly "poor excuse for a media".  Each link contains multiple stories about the situation.

     

    http://www.google.com/news?ncl=dn7Bed7JvJ2dUTMQt_XhRF-YjrmnM&q=cyprus&lr=English&hl=en ....multiple pages of articles, all about Cyprus, mostly from U.S. news sources.

     

    These are multiples stories about Cyprus, all from U.S. news sources.

     

    http://www.foxnews.com/search-results/search?q=Cyprus&submit=Search

     

    http://www.cnn.com/search/?query=Cyprus&primaryType=mixed&sortBy=relevance&intl=false&x=0&y=0

     

    http://www.cbsnews.com/1770-5_162-0.html?query=Cyprus&tag=srch&searchtype=cbsSearch

     

    http://abcnews.go.com/search?searchtext=Cyprus

     

    http://www.nbcnews.com/?id=11881780&q=Cyprus&search=&p=1&st=1&sm=user

     

     

    So as you see, we haven't exactly been in the dark about this.

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  • Since the topic hasn't really been covered by the U.S.'s poor excuse for a media,

     

    >snip<

     

     

    Thanks for the links, I hadn't seen anything about it on their main news channels. I didn't go and search their websites.. And I live here in the U.S. also, so I do know what "we" are in the dark about.

     

    Anyways glad to see someone is paying attention!

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  • Well first off, if I understand you correctly. You think its ok to steal money from people as long as the majority of those people are criminals? 

     

    And second, I honestly don't know how large Cyprus is, what the population is etc... but any legitimate business with 30+ employee's would have 120,000+ in the bank... Just to make payroll, this isn't just from private citizens its ALL bank accounts over 100,000.

    And if I understand you correctly, you believe that once someone got away with stealing money by parking it on some offshore account, the rest of the world must refund that person when his offshore banks collapses? 

     

    And Cyprus is small. About a million people living there in total. The total GDP of Cyprus is like 1% of the total Eurozone GDP, so again, it is an insignificant little place. They build their economy by providing services much like how they did it on Iceland, and then when the bubble burst, the rest of us can come in and bail them out because they screwed up big time. But hey, if we want to hold them accountable to some extend for the mess they made themselves, we are the bad guys, because how dare we steal all that money! If we had not done anything, all their banks would have collapsed, and everyone with more than a 100.000 on the banks would have lost their money just as well. 

     

    But is this bad for the economy on Cyprus? Yes, it will take a massive blow. Sadly, when you build your economy based on bubbles and the bubbles burst the economy will collapse, no matter the bailouts you send their way. One can only hope that the people on Cyprus take this as an opportunity to rebuild their economy from the ground up, and this base it on more stable and sustainable sectors. 

     

     

    Well first off, I haven't seen any proof that these Russian investors are criminals.. only your word. But we'll make the assumption you know what you are talking about.

     

    But still even if 90% of the bank accounts are Russian, and 90% of those are criminals (which seems really high) it still means that they are taking money from 10-15% of a honest population. End of story.

     

    And by all means if Cyprus got into this trouble they should be the ones to get out of it (one reason why I think the euro is a horrible idea). But just TAKING money from private people? and businesses? 

     

     

     

    But with the EU the financial shape they are in, and the leaders they are electing.. I mean Neo-Nazi's taking power in France? why do I feel like this is the 1920's again?

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    Thanks for the links, I hadn't seen anything about it on their main news channels. I didn't go and search their websites.. And I live here in the U.S. also, so I do know what "we" are in the dark about.

     

    What else are we in the dark about, that maybe I'm personally unaware of?

     

    Anyways glad to see someone is paying attention!

     

    Probably more than I should be.  Watching and reading the news these days is so depressing.

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  • Thanks for the links, I hadn't seen anything about it on their main news channels. I didn't go and search their websites.. And I live here in the U.S. also, so I do know what "we" are in the dark about.

     

    What else are we in the dark about, that maybe I'm personally unaware of?

     

    >Anyways glad to see someone is paying attention!

     

    Probably more than I should be.  Watching and reading the news these days is so depressing.

     

     

     

    I would say a good percentage of Americans don't have a clue whats really going on in the world, I mean we are now 16+ trillion in debt, been above 8% unemployment for almost 5 years now (And the real number is more like 12-14%), N Korea is pretty much saying as soon as they are ready they want to nuke someone... and somehow Obama and congress got reelected?! if everyone was paying attention, how did that happen?

     

     

    Anyways, I didn't really want to derail my own topic, but I just see whats going on in the world and shake my head.

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    Well first off, I haven't seen any proof that these Russian investors are criminals.. only your word. But we'll make the assumption you know what you are talking about.

     

    But still even if 90% of the bank accounts are Russian, and 90% of those are criminals (which seems really high) it still means that they are taking money from 10-15% of a honest population. End of story.

     

    And by all means if Cyprus got into this trouble they should be the ones to get out of it (one reason why I think the euro is a horrible idea). But just TAKING money from private people? and businesses? 

     

     

     

    But with the EU the financial shape they are in, and the leaders they are electing.. I mean Neo-Nazi's taking power in France? why do I feel like this is the 1920's again?

    If we let them handle the mess they made, it would further destabilize the Euro, and everyone on Cyprus would lose their money and more banks would go down as well. Now only the two biggest banks get hit, and only the investors in those banks lose their money above a 100.000 euro's. It is the only way short of letting the rest of Europe pay for the Cypriots Language--hym up their own economy. Which quite frankly, is starting to bankrupt the rest of Europe. The Netherlands already has to cut back billions of euro's mostly because of all the money we pay to bailing out the other countries. And do they thank us? Oh no, in Greece they portray us as Nazi's while they are more busy protesting rather than manning up and finding solutions to save their country, while voting for actual Nazis, in Italy they vote for that Could have used a better word here.--hym Berlusconi and his fascist friends, and in Cyprus we get accused of stealing from private citizens when in reality we saved the small savers as much as we could. Well gee, nice to know our efforts to save everyone from bankruptcy are so well liked. 

     

    But indeed, the way the euro was introduced was bad. We should have been more stricter from the beginning and not included countries like Greece, and we should have had a better monetary policy in place. I believe that it was originally planned to do that, but right after the Euro was introduced, euro-skepticism took hold in a number of countries and any further attempts of integration were blocked. We pay the price for that right now. 

     

    Oh, and France did not elect Neo-Nazis. Front National has always been there and they are slowly growing (which is worrying) but they are not in charge. 

     

    Oh and don't see it as the EU just taking money. See it as a one time tax over the financial saving accounts of people in Cyprus. 

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    Tsk, tsk.  Someone has had a nerve touched.

     

    I went to school with a couple boys from Cyprus during the time of the struggle with the Turks.  It was an interesting time complete with guerrilla warfare.  Canada has one of its earliest peace keeping missions going there, and they were allowed to shoot back.  At one point, the people of one village did something atrocious to the next village.  The Canadian peacekeepers walked their artillery though the offenders' village.  It was really a different time.  I have this from a soldier who was there.

     

    The Cypriots have been quiet and uninteresting and getting along with their lives in peace.  Too bad they managed to overdraw their credit card, but someone was living in a manner beyond their means.  Wonder who it is?  I hope they catch him too.

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    The EU is crumbling slowly. Sooner or later there won't be any money left in the "Help For Un-Credit Worthy Countries" pot. Then what will happen? These tough financial times are a breeding ground for Right Wing groups, and all the nonsense that goes with that kind of crap.

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  • Original Poster
  • The EU is crumbling slowly. Sooner or later there won't be any money left in the "Help For Un-Credit Worthy Countries" pot. Then what will happen? These tough financial times are a breeding ground for Right Wing groups, and all the nonsense that goes with that kind of crap.

     

    Wasn't aware that "staying within your means" and "conservative fiscal planning" is "crap".... but to each his own. I know here in the U.S. the most well off states and cities are run by republicans. But by the same token George Bush didn't do a thing to stop us from going down this horrible path, and he claimed to be a conservative..

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  • I didn't say that staying within your means was crap, I was commenting on the financial state of the EU and the rise of right wing politics, which is crap.

     

    Ah, here in the U.S. "right wing" would normally refer to the more Conservative end of the political spectrum.  

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    The EU is crumbling slowly. Sooner or later there won't be any money left in the "Help For Un-Credit Worthy Countries" pot. Then what will happen? These tough financial times are a breeding ground for Right Wing groups, and all the nonsense that goes with that kind of crap.

     

    Wasn't aware that "staying within your means" and "conservative fiscal planning" is "crap".... but to each his own. I know here in the U.S. the most well off states and cities are run by republicans. But by the same token George Bush didn't do a thing to stop us from going down this horrible path, and he claimed to be a conservative..

     

    Sadly (I am a Republican) that is merely the narrative, not supported by the economic figures after they have been corrected by ranking agencies. Ofcourse, we could argue that because those are not American they are evil, but there is a rather bitter truth in how we tend to get caught in how we present things and the reality beneath it. The idea that because we Republicans out of our ideology are better suited for making money is a popular myth, but it is a myth. We are good at artificially inflating economic circles yes, but there always remains the difference between the virtual economy figures and those of spending figures in reality. 

     

    I'm a liberal, and I am a moderate conservative, but I will always be the first to admit that we always need to make a reality check to discern between our propaganda and the difference between our wishes & wants versus reality. It does not matter whether we look at federal, state or urban level, we're good at making economics work for special interests, but we always do so by declaring debt shouldered by the general interests. That is something which has worked very well, particularly ever since we removed a lot of restrictions against such methods on the federal level under Reagan, but there are limits to such artificial constructs. The most notable one is that of the psychology of human behaviour, the absence of buffer mechanisms always leads to excesses in behaviour. The costs of which have traditionally been shifted to the society as a whole. In a way having a Democrate for President these recent terms is pure irony, because the policies are more Republican than most of us Republicans are willing to admit. 

     

    Biggest example recently is the bank bailout. Both concept and methods put together out of an advisory circle of liberal conservative orientation. Pure irony. As much as I dislike that Obama is a Democrate I have to admit that when push comes to shove on matters of economics he is a liberal conservative who operates directly in line with the special interests our own party has spent 70 years securing as part of our networks. 

     

    As for Cyprus, it is quite hard for us as Americans to understand the resistance of Europeans against offloading problems created by financial institutions through excesses in human behaviour on the tax payer. The recent storm of the financial world against that Dutch Dijsselbloem guy is absolutely hilarious, even if it is sad because his statements made clear that the conflict between politics and economics has reached the point where in Europe it is no longer a given that enterprises and institutions of finance who aspire to abusing the dependancies between economics and society by means of offloading their problems on the shoulders of citizens can continue to do so. That was the crux of the media madness. Why are you saying that you will no longer use tax payer money to pay our debts man! How are we going to keep making our money. 

     

    Twisted. Ofcourse the Russian connection is interesting, but it was a given that their money would find a backdoor to leave. That is what they invested for after all. What is really surprising is that Russia did not use this opportunity to insert Gazprom in to the mix and secure yet another vaste reservoir of natural gas for strengthening the energy stranglehold on the EU. That is the real surprise of all of this. Cyprus basically went to Russia to negotiate, and unlike every other similar situation in the past the Russians said "no, we're not even interested in getting your gas fields". A very strange hiccup in Russia's foreign and economic policy. 

     

    Personally I do not see any problem with allowing enterprises and institutions who screw up to fail, no matter how big they are. Not only is it morally right, it is also commercially and economically rewarding for the society they are connected to (ofcourse it creates chaos, but it creates more opportunities than it destroys, that is after all what upsetting any status quo does in human history). We've seen the examples of Argentina and Brasil where matters were too big to fail and they failed anyway, after which a guided approach at covering debts through declaration of further debts has created an economy inherently unstable and prone to the demise of opportunity trending, but we have also seen other examples where societies decided to not take that road and where it took a mere few years to revamp the society in to an extremely productive one. Look at Iceland for example, lots of madness, lots of drama, lots of lobbyism from the financial world but they let the banks go bust. And as a result their economy is in better shape now than it has been for the past 40 years (which incidentally marks the time where banks created the same problems as well, equally incidentally problems created by the fathers of the very same people who inflated Iceland's economics and ran off with billions in the most recent crisis). 

     

    But really, what could possibly be wrong with refusing to let a society pay for the deliberate and conscious decisions of financial entities to create problems for themselves and their invested parties. It's not like letting them fail kills economies. It's not like letting them die introduces instabilities among dependancies, those after all are already in place because they are created by such policies of such enterprises. Look, I'm sorry, but the bulk of all the storms is nothing more than marketing from interest groups who do not want to adapt to circumstances changing and their ability to offload debts on a society as a whole being negated. Sure, that is how they tend to make the most money, but where does the idea even come from that a society as a whole has to bear the load of deliberately created debt and failure of a mere few. Where does the idea of "too big to fail" even come from? It's marketing, that is clear yes, but where does it come from? From those entities who stand to make as much money as before when they have to carry their own risks. Twisted. The truth in it is that our financial sectors are just lazy, and scared, but they have left no room for competition deliberately so their only recourse is to seek a structural influence over politics for as long as that still is a limiting factor. In that sense it is again pure irony that stateside they have won that battle (we're once again artificially inflating our economy with business as usual) whereas in the EU that conflict has now taken a different turn. 

     

    I get the idea here in Europe that exactly because they carry so much history they may be less prone to flexibly seize circumstances as for example the US, but equally because of that history they also have a much deeper cross cultural memory of how bad things can get when powers of systems and organisation are not seperated. Let's not forget that the period since the second World War until today is the longest period in the history of the continent where its peoples have not alternated between the continent burning from war or poverty or the right of kings every few short decades. The idea behind the concept of the EU is that of a security mechanism against the lessons of history. 

     

    Sure, it is diverse and often enough even almost schizofrenic, but they invest much more in the processes rather than temporary outcomes. Something which for the long term will actually stabilise matters better than any other approach. There will be tough lessons, and it is not going to be easy, but it is a continent which has known so much worse in its history. And let's be honest, they all individually have a lot to lose from remaining individuals. Even more honestly, they are figuring out how to make money out of the screwups of the financial world. Remarkable. 

    I can't see the EU fracturing, but I can see it changing. In many ways it reminds me of its precursors like the league of city states in more ancient times where Athens was rather a lot more than today's tourist attraction. 

     

    What they will have to do eventually is decide which direction to take. They are required to grow their interconnectivity, and they are doing that (because it pays to do so), but there is a big choice between seeking political union and economic union. Right now it is moving towards the latter, but in full recognition that if that is to be the road it is to be one under control of their implementation of trias politica and not as in the us under control of special interest constructs. For me as an American it is hard to get my head around, especially as a Republican even, but regardless of what European country you visit there is this wierd thing of going wherever you like to go and always seeing the signs of destruction and causes of that in the past. Maybe that is what we back home miss, we have plenty of monuments, but we have no scars on our soil that constantly scratch our legs when we try to walk. 

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    Wasn't aware that "staying within your means" and "conservative fiscal planning" is "crap".... but to each his own. I know here in the U.S. the most well off states and cities are run by republicans. But by the same token George Bush didn't do a thing to stop us from going down this horrible path, and he claimed to be a conservative..

    We are currently doing that and it is not doing our economy any favors. Just cutting back billions after billions on top of more billions is destroying our economy just as much as not doing anything. It is destroying the social safety net, it is further eroding the public's trust in both the government and the economy, which only results in declining consumer trust, it is destroying more jobs than it creates. And does it make things more efficient? No, it does not, things are just cut out or outsourced to private companies who do the same work for double the price (which the government ends up paying). Meanwhile we also made education more expensive, when the benefits on education are huge. Every euro spend on educating people will pay itself back when you have a well educated workforce who can do good jobs that pay more. 

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