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DU Home » Latest Threads » Forums & Groups » Topics » Activism » Occupy Underground (Group) » This Crazy Cyprus Deal Co... » Reply #3

Response to dkf (Reply #1)

Sun Mar 17, 2013, 07:28 PM

3. I doubt a Russian exit would occur

To them its pretty much just the downside to the interest rates they've enjoyed there. They might not have anywhere to move it to. It would damage them more if banks folded completely - they've not got the EU guarantee for member states on the first 100,000 euros. That guarantee covers the inability of banks to pay - not the tax which is the subject here.

Northern Cyprus, the Turkish sector, seems to be pretty much unaffected by this other than where the population may be holding euro accounts in the south - Turkish sector doesn't officially use the euro although its probably accepted in shops.

If Cyprus doesn't agree to pass the tax as is or reach a compromise for maybe a higher figure above the 100k, a lower figure band below that and nil for the poor I'd say Cyprus will go bankrupt and leave the Euro. If that were to occur the tax mentioned will be viewed as small change in the future when inflation hits home with a new currency - Cypdrachma whatever.

Russia itself is already in there with loans and are quite capable of bailing them out completely - maybe in exchange for a naval base there.

There are many stories in the naked city : the above is just one of them.

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