Cyprus ends up being a special case. No one in the government questioned the arrival of the Russians....the lack of taxation on anything they made profit off...or the fantastic amount of money they dumped onto the banks, with no one in the government or the public questioning the wise or unwise investments.
Russians literally flew in and deposited billions onto an island country with barely one million residents. The bank managers literally threw the money into the wind....never having anyone question them.
If you check around....by summer of 2012...almost everyone agreed the whole banking sector was now screwed up. The EU as of last summer, already knew how bad this was, and it was a simple process to blame massive Russian investments. This took less than ten years. If you go back to prior 2000 and the arrival of the Russians and the Euro...they were doing ok. You could probably write a 500-page book on stupid investing and how the Russians disregarded every rule in the book (dump the money and expect results).
As for a comparison? It’d be closer to compare the Cyprus event to 1929 crash...which the banking sector dumped headfirst into Wall Street investments and dragged all of their customer’s money (sitting in plain checking and savings accounts) with them. Cyprus has done the same thing. The EU has a point here....they will only guarantee the accounts of 100k Euro or less, that’s the general rule. That was the insurance rule to protect everyone in the first place. The rest of them? Tough luck. Unwise investments by the banking sector got them into that situation.
Creditanstalt 2.0
” It’d be closer to compare the Cyprus event to 1929 crash...which the banking sector dumped headfirst into Wall Street investments and dragged all of their customer’s money (sitting in plain checking and savings accounts) with them”
Actually, this scenario is being replayed right now in the U.S. stock market. The Fed is giving their banks pretty much all the extra spinning ones and zeros they want for practically zero interest rate, those banks in turn won’t lend those spinning ones and zeros to legitimate borrowers (too much risk), but instead make 30-day loans for a tiny markup above zero interest rate to Wall Street “investment” houses, and they in turn pump it into the U.S. stock market.
Too many spinning ones and zeros sloshing around looking for too few legitimate investments.
At this point, it seems to me that,
U.S. Fed banks + U.S. Stock Market = Russian “investors” + Cypriot banks.