Yet another Euro zone country needs a bail out and those clever EU leaders solution to guarantee the 10 Billion loan is to steal the savers money in Cyprus in a dawn raid. EU democracy working at it's best! How long before the single currency is put out of it's misery?

Was it the Euro that created the problem?
Or was it Greece's debt covered-up by fake accounting?

Can you remind us what the consequences of this were for Goldman Sachs, the company that was responsible, if memory serves, for that false accounting?

Dunno Minty, haven't heard of them for a while.
Any ideas?

It's the latter of course but the solution to the Cypriot problem is a disaster.

There was a story on Newsnight last night about this featuring Artur Fischer, CEO of the German Stock exchange and Elinor Panaritis a Cypriot economist. His position was the rest of the Eurozone wasn't prepared to simply bail out the Cypriot bank and Cyprus had to contribute. It's all to do with the "well run" northern eu zone countries not being prepared to bail out the "southern slackers" politics of the eurozone.

What he seemed to be be missing was any concept that it wasn't Cyrpus's fault that Greece went belly up. He also said while the rest of the euorzone would provide 10bn out of 16bn euros required Cyprus had to find the test and that therefore it [umust come from the tax payers[/u. Why must it? He didn't explain why it must come from the taxpayers or why for that matter the fact Cyprus was in a mess through no fault of its own meant this either.

Elinor Panaritis opposite was impressive and made some very good points including pointing out this is the failure of a [ibank[/i not a failure of fiscal or government policy and when [ibanks[/i have been facing failure elsewhere they have been bailed out to a far higher degree such as 100bn Euros of guarantees to Dexia bank (Franco-Belgian bank) and of course Northern Rock but at no point where these funded by a raid on depositors money.

The German just reiterated Cyprus must contribute and that raising the money in the way it did was a very efficient (

) way of doing it but perhaps the Cypriot government had not got it right from a social point of view by which he was obviously meaning the less well off were contributing too much. He just didn't seem to get a raid on depositors money could perpetuate a different kind of crisis all on its own.

Here is a link to the program at the point the discussion starts:

[urlhttp://www.bbc.co.uk/i/b01rg0rz/?t=8m19s[/url

well worth watching to get an understanding of the different perspectives from "north" and "south". IMO given the lax policing of the Eurozone was perpetuated by Germany as much as any country they shouldn't be bullying Cyprus like this and should just accept that having to bail two of its banks out is part of the price Germany has to pay for letting things be so lax in the first place.

Nothing that I've heard of. I think they got away with their cocked-up cooking of the Greek books – sorry, 'accounting'.

Theyr'e still [url=http://www.goldmansachs.com/?cid=PS_01_05_06_00_00_00_02_Ad4Building Businesses, Strengthening Communities[/url apparently.

Anti-Pickles commentary that I would imagine some on here would agree with: www.standard.co.uk/comment/comme ... 40645.html

Anti-Pickles commentary that I would imagine some on here would agree with: www.standard.co.uk/comment/comme ... 40645.html

We can debate the original problem if you wish but my point was the Euro crisis has not gone away and will not because the single currency is fundamentally flawed. It has created a north south divide and made most Euro zone countries uncompetitive with Germany. For Germany to impose unrealistic and possibly illegal terms before they will fund the 10 Billion goes against the fundamental idea of the single currency. The Euro is doomed and is only being kept alive by the EU politicians who don't want to admit their mistakes before they retire or are kicked out.

A new political party has been formed in Germany with over 25% support whose aims are to exit from the Euro. They fully support David Camerons ideas to reform the EU too.

The fake accounting was not too important to the EU leaders at the time as they rushed to expand their empire and Germany was too busy negotiating a deal with the Greeks to buy a large number of tanks and submarines which would be funded with the EU grants once their membership was execepted. Cover up.... what cover up!

A new party has been formed, Alternative für Deutschland (FW).

A poll last week for [iFocus[/i news magazine found 26% were supportive of an anti-euro protest. They came from across the political spectrum.

This does not mean that the new party has 25% support.

Further, the leaders of FW have stated that their aim is not to leave the Euro, but to stop bailouts.

Cyprus redraws map

I think you mean you would like it to be doomed.
EU politicians are busily correcting the mistakes (which IMHO include not having fiscal union at the launch of the Euro).
The markets are still buying Euro, its value against the pound and the dollar are higher now than when it was introduced. (It is down against the Swiss Franc and the Japanese Yen ... but how many currencies aren't?)


Are they clairvoyant?
Cameron hasn't made any real case yet and the things he has managed to mention so far are all business-as-usual topics anyway, highlighted as some sort of tough stance to show the near-sighted Europhobe tendency in his party that he's the man to give Johnny Foreigner a bloody nose.


I agree that Greece should not have been allowed to join the Euro and the expansion of the EU was far too fast, when consolidation of the existing Union should have been the priority (i.e. deeper union before wider union).
I still hold to that view.

You seem to be saying that Greek membership was dependent upon them buying arms from Germany.
That is nonsense.
It's very easy to point at what arms they bought from companies in several other EU member states and come up with a conspiracy ... but Greece bought very expensive aeroplanes from the US, I guess that was just to put us off the scent eh?

Probably no more so than Elpers himself putting two and two together and coming up with six as he leaps to draw conclusions.

If you want to see the effects of rolling-back-the-state, look back at Bradford in the late eighties, early nineties ... a period from which it has yet to recover.
Pickles did that.
Osborne has been doing the same, but on a National scale.
Destruction is easy.

Quote ="Dally"Anti-Pickles commentary that I would imagine some on here would agree with: www.standard.co.uk/comment/comme ... 40645.html'" The interesting thing in that article for me is the assertion that rich foreign nationals contribute very little to the London economy and in fact work against it as they drive property prices up. So instead of being cautious about taxing foreigners who are using London property as a safe haven away from the Eurozone we ought to be going after them and making them pay for the privilege of enjoying the protection our society affords. If they all left as a result we'd lose next to no revenue and the property market would cool.

Quote ="Dally"Anti-Pickles commentary that I would imagine some on here would agree with: www.standard.co.uk/comment/comme ... 40645.html'" The interesting thing in that article for me is the assertion that rich foreign nationals contribute very little to the London economy and in fact work against it as they drive property prices up. So instead of being cautious about taxing foreigners who are using London property as a safe haven away from the Eurozone we ought to be going after them and making them pay for the privilege of enjoying the protection our society affords. If they all left as a result we'd lose next to no revenue and the property market would cool.

Steady on Dave, prices then might allow essential workers to be able to afford to live within an hour or two of where they work ... we can't be having that.
Out of sight, out of mind and all that.

Germany isn't bullying anyone. Nobody is forcing Cyprus to borrow this money.

The main reason why Germany - and other 'Northern' EU countries - are expecting the Cypriot government to contribute to the bail-out of it's banking system is that the Cypriot government isn't blameless in the problems the bail-out is intended to fix. They appear to have tried to become the Switzerland of the South.

And the decision to levy ordinary bank depositors did not come from Germany. Or the IMF for that matter.

If Cyprus are successful in getting Russia to bail them out could Russia extract a price - like leasing a seaport there and positioning one of its fleets there? Now that would cause consternation throught Europe and North America. Maybe Britain / the US should try to bail them out?

Don't try to upset the cultural apple cart.

The 'price' has already been paid and is being paid – being able to bank dodgy money in the country, no questions asked etc.

Do you think snatching bank deposits is actually the right thing to do? Logically (which is where the Germans come from) it is from two perspectives. Firstly, if the banks went bust they'd lose a 100% not 10% or whatever the latest suggestion is. Secondly, conceptually bank deposits are not savings but loans in exchange for interest to allow fractional reserves banks to lend and do bussiness.

Once again, the idea of raising a levy on ordinary bank depositors did not originate in Germany.

Where the Germans come from is not wanting to bail out Cypriot banks. They don't care how Cyprus raises the 6bn euors in cash so long as they raise it and the Germans aren't having to pay it. The bloke from the German stock exchange on Newsnight I linked to even called raiding deposits and "efficient" way to raise the cash but also said it was a matter for the Cypriot government to decide how to do it. It was basically "We don't care how you get it, just get it".

The depositors guarantee scheme means you are fully protected up to 100,000 euros which will cover the majority of savers. It's the big depositors who would be hit hardest by a default but then I for one would be spreading my assets across numerous banks if I were that rich so I was fully protected.



You are not lending your money to the bank but depositing with them which is definitely not the same thing. It is not a loan as you can ask for it back at any time you like.The level of return on savings (virtually nothing) doesn't reflect any risk either. Banks borrow by issuing bonds and this is the crux of the matter in terms of who takes any hit. The whole premise set out by the regulators in the Eurozone is that ordinary savers are not supposed to be penalised for bad banking because they can't be expected to quantify the risks. Bond holders on the other hand can and so if the banks can't pay their loans to these bond-holders back then tough, those are the rules.

What was proposed completely turned this around the other way and completely undermined the guarantee scheme in one fell swoop.

The reason the bond holders were not just allowed to take the hit is because they were institutions from outside Cyprus such as German banks and so ultimately German tax payers would be affected. But so what? [iThat is how the system was supposed to work. [/i Bond holders were supposed to excerpt influence on the banks they invested in to be sensible. The fact even if they had been able to do that the "haircut" due to the the Greek economic collapse is what started this particular ball rolling is no reason to wreck the confidence in the banking sector as a whole. I was looking on the comments on the BBC yesterday and some people were posting that they had been to their UK banks and withdrawn virtually all their money to stick it under the mattress.

So, not "bullying", then?