We all are captivated by what is happening in Cyprus and today is their D day. They have to make a decision on what they are going to do. The ECB has said it is cutting off all money starting tomorrow.
I have done some research and found that Cyprus use to be a very strong and wealthy country.
In 2008 they joined the EU and began using the Euro. The banks only loaned out 30% of their deposits before that time and made people put 30% down for a mortgage. They were very conservative with their banks and finances and were not affected by the 2008 crisis. They were fiscally responsible and a very healthy and prosperous country.
But once the EU got them to accept the Euro and become part of the EU only 5 short years ago. They went from being prosperous and fiscally sound to bankrupt in that short amount of time.
The EU began changing how they did business in the banks. They purchased huge amounts of Greek bonds and loaned out more money than their deposits. They went from fiscal soundness and responsibility to doing as all the other banks of the EU did, thus causing debt slavery to their citizens.
You could almost say......It appears the EU purposely committed the Cyprus citizens to become debt slaves and purposely had the banks become indebted to the ECB and controlled.
Now the EU wants to steal everyone's money in Cyprus, when Cyprus would never be in this situation had they not joined the EU!
I believe this shows the purpose of the EU and their causing sovereign countries to be their servants and serfs of debt with a one government control.
Before joining the euro, the Central Bank of Cyprus only allowed banks to use up to 30 per cent of their foreign deposits to support local lending, a measure designed to prevent sizeable deposits from Greeks and Russians fuelling a bubble. When Cyprus joined the single European currency, Greek and other euro area deposits were reclassified as domestic, leading to billions more local lending, Pambos Papageorgiou, a member of Cyprus's parliament and a former Central Bank board member said. "The banks were considered super conservative," said Alexander Apostolides an economic historian at Cyprus' European University, a private university on the outskirts of Nicosia.
When Lehman Brothers collapsed in the summer of 2008, most of the world's banks suffered in the fallout, but not Cyprus's. "Everyone here was sitting pretty," said Fiona Mullen, a Nicosia-based economist, reflecting on the fact Cypriot banks did not depend on capital markets for funding and did not invest in complex financial products that felled other institutions. A source at one of the banks, who asked not to be named, said his institution did not have "serious problems with lending", adding that Cypriot banks typically demanded a down payment of 30 per cent for home loans, well above the average in most countries.
The rapid expansion left Cyprus with a banking system eight times the size of its national output, as its accommodative regime of not taxing foreigners' dividends and capital gains lured investors from countries like Russia. The EBA figures showed 30 per cent (11 billion euros) of Bank of Cyprus' total loan book was wrapped up in Greece by December 2010, as was 43 per cent (or 19 billion euros) of Laiki's, which was then known as Marfin Popular. More striking was the banks' exposure to Greek debt. At the time, Bank of Cyprus's 2.4 billion euros of Greek debt was enough to wipe out 75 per cent of the bank's total capital, while Laiki's 3.4 billion euros exposure outstripped its 3.2 billion euros of total capital. The close ties between Greece and Cyprus meant the Cypriot banks did not listen to warnings about this exposure. The banks sold down some of their Greek holdings, but then got back into the market as yields rose. "When the Germans were selling, they were buying," said Apostolides, referring to the German banks' 2011 dumping of Greek
The facts are the EU itself is the reason why Cyprus is in the shape it is in. Some would look upon it and wonder if that was done on purpose. A healthy country that did not have a debt problem and had stayed strong during the 2008 banking crisis..... was a threat to others? They were added to a currency and union, thus their financial health dropped within 2 years?
The purpose of the EU is becoming clear. It is about control of the whole European area and control of all the people. It is about having all the people become their servants and debt slaves. The truth is shining through and Cyprus is proving what the EU thinks about the citizens of the world.
I wrote an opened letter to the banks and governments yesterday, letting the banks and governments know what I think!
A little extra: The President of Cyprus warned his friends the week before the surprise announcement of the stealing of everyone's money.
The Cyprus newspaper did not say how much money was moved abroad but quoted sources saying the president 'knew about the possible closure of the banks' and tipped off close friends who were able to move vast sums abroad.Italian media said the 4.5 billion euros left the island in the week before the crisis.
Edit to add 3/25/13 - Deal reached for Cyprus without Parliament being allowed to vote - 40% Stealing of deposits. EU dictatorship now.
UPDATE 3/26/13 - Jim Willie Interview about Cyprus and inside information
UPDATE 3/28/13 - Bloomberg, an MSM finally acknowledged Cyprus was healthy before joining the EU.
Bailout fatigue says: "The Cypriots got themselves into this mess, and they should get themselves out. We'll lend them a bit more, but only if we're sure they'll pay us back." Cyprus didn't get itself into this mess. It joined the euro system in 2008 with low public debt and a clean bill of health from EU governments (back then, not a word was said about shady Russians). Its banks are in trouble not because they accepted too many overseas deposits but because they bought too many Greek bonds -- an investment sanctified by international banking rules (which called such investments riskless) that was destroyed by the EU's ham-fisted resolution of Greece's threatened default.
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