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First they purloin the savings and bank deposits in Laiki and the Bank of Cyprus, including the working funds of the University of Cyprus, and thousands of small firms hanging on by their fingertips. Then they seize three quarters of the country’s gold reserves, making it ever harder for Cyprus to extricate itself from EMU at a later date. The people of Cyprus first learned about this from a Reuters leak of the working documents for the Eurogroup meeting on Friday. It is tucked away in clause 29. "Sale of excess gold reserves: The Cypriot authorities have committed to sell...

House prices in Spain dropped 9.7% YoY in Q4 2012. That is the biggest drop in house prices on record. Welcome back to 2004 levels. Meanwhile, the unemployment rate in Greece climbed to 27.2%. There is news from Cyprus as well. Less than a month after Cyprus bailout deal was agreed, the bailout bill has risen to €23bn – larger than the size of the Cypriot economy. But here is the strange part. Germany is helping the bailout of Cyprus, but Cypriots are five times wealthier than Germans before the crisis. The Germans are bailing out Cypriots who are wealthier...

At least 1,600 Greek businesses - from shipping, retail to tourism - will suffer from the Cyprus bailout deal announced on Sunday after a showdown between Brussels and Nicosia, according to Vasilis Korkidis, head of the National Confederation of Greek Commerce (ESEE). “The tragic situation in Cyprus will certainly have immediate effects on the Greek market, since a large part of the domestic businesses maintain close ties with Cypriot companies,” Korkidis said in a statement on Tuesday. He was particularly critical of the capital controls and the impending haircut on large deposits (over 100,000 euros) expected to be more than...

<p>The punishment regime imposed on Cyprus is a trick against everybody involved in this squalid saga, against the Cypriot people and the German people, against savers and creditors. All are being deceived.</p>

A rescue program agreed for Cyprus will serve as a model for dealing with future euro zone banking crises and other countries will have to restructure their banking sectors, the head of the region's finance ministers said. The approach would mark a radical departure for euro zone policy after three years of crisis in which taxpayers across the region have effectively been on the hook for resolving problem banks and indebted governments via multiple rescue programs. "What we've done last night is what I call pushing back the risks," Dutch Finance Minister Jeroen Dijsselbloem, who heads the Eurogroup of euro...

Ok folks, if you live in Cyprus and are one of the common people there, perhaps a "wealthy" person such as a businessowner but not one of the "connected few", now it has come out how you were screwed. Laiki Bank customers in the UK face no restrictions on access to their cash and have been told it is "business as usual" at the firm's four British branches, despite an overnight decision to close its Cyprus parent. .... Ruth Harvey of Laiki Bank in the UK said that although not all of the details of the impact of the agreement...

The decision of the government in Cyprus to simply take money out of people’s bank accounts there sent shock waves around the world. People far removed from that small island nation had to wonder: “Can this happen here?” The economic repercussions of having people feel that their money is not safe in banks can be catastrophic. Banks are not just warehouses where money can be stored. They are crucial institutions for gathering individually modest amounts of money from millions of people and transferring that money to strangers whom those people would not directly entrust it to. Multibillion-dollar corporations, whose economies...

Yesterday, we first reported on something very disturbing (at least to Cyprus' citizens): despite the closed banks (which will mostly reopen tomorrow, while the two biggest soon to be liquidated banks Laiki and BoC will be shuttered until Thursday) and the capital controls, the local financial system has been leaking cash. Lots and lots of cash. Alas, we did not have much granularity or details on who or where these illegal transfers were conducted with. Today, courtesy of a follow up by Reuters, we do. The result, at least for Europe, is quite scary because let's recall that the primary...

With news this evening that the Cypriot banks will not now be re-opening tomorrow (as perhaps - as we noted earlier - a little more of those precious deposits leaked away during the closures than expected): CYPRUS BANKS TO REMAIN CLOSED THROUGH MARCH 27: CENTRAL BANK We thought it useful to consider Cyprus in relation to the longest bank closures in history. Cyprus has now shutdown its banking system longer than Argentina, Ecuador, and Uruguay and as far as President Anastasiades comments that capital controls are temporary - we can only hope for the depositors sake - that it's not...

BRUSSELS (Reuters) - A rescue program agreed for Cyprus will serve as a model for dealing with future euro zone banking crises and other countries will have to restructure their banking sectors, the head of the region's finance ministers said. The approach would mark a radical departure for euro zone policy after three years of crisis in which taxpayers across the region have effectively been on the hook for resolving problem banks and indebted governments via multiple rescue programs. "What we've done last night is what I call pushing back the risks," Dutch Finance Minister Jeroen Dijsselbloem, who heads the...

It was very much unavoidable. As of right now, people in Cyprus are hungry for hard cash. For paying in gas stations, even groceries, suppliers want cash. Milk and medicine for your child? Cash only.

In the wake of declining to raid the country’s private bank accounts as part of the terms of a proffered bailout package from the EU and IMF, Cyprus was hoping they might be able to entice Russia to work out an alternative rescue plan for them, partially in exchange for some kind of claim on Cyprus’s gas reserves.So much for that plan. Russian gas giant Gazprom and oil company Rosneft did not display any interest in Cyprus’ hydrocarbons deposit offer to Russia, an Energy Ministry source told journalists. …Another problem is Cyprus’ territorial disputes with Turkey, he added.Asked to assess...

You don’t need to worry about the financial crisis in Cyprus sparking trouble for the U.S., according to Federal Reserve Chairman Ben Bernanke. European officials’ marathon efforts this week to head off a collapse of the tiny island nation’s banking system have raised fears that the renewed turmoil in the euro zone could threaten the gathering momentum in the U.S. housing and job markets. But Bernanke said that’s not likely. “We are monitoring very carefully but at this point we’re not seeing major risk to the U.S. financial system or the U.S. economy,” he told reporters Wednesday.