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Cyprus versus the EUstapo – a mischievious idea

Cyprus has called the EU’s bluff.

The ECB had said if Cyprus did not agree to the seizing of depositors’ money to bail out the banks it would not continue to support Cyprus’ banks which would in all likelihood mean the largest bank, Bank of Cyprus, would run out of money as early as the end of the week. The bank would collapse and …

Of course the threat was implicit that this would be disaster for Cyprus but entirely containable for Europe. But now that the Cypriot parliament has rejected the EU collective punishment of seizing depositors’ money I suspect the threat looks a little less spiffy in Brussels and Berlin.

I suspect a few European banks and nations might be checking just how many Cypriot and Cypriot bank bonds they still hold. As might a few EFSF bureaucrats.

Of course some sort of Euro fudge will most likely be squeezed from some Euro orifice and be pushed into the self inflicted wound but the damage has already been done. The EU has managed to make it quite clear to every European that the ‘technocrats’ are quite willing to seize people’s money whenever they think it ‘best’.  Best for whom of course is another question.

They have made it clear there is no law that restrains them. Technocrats rule. Not govern, rule.

So I just wondered, now that we are in the famous ‘uncharted territory’ that the EUstapo are always threatening us with,  what more could  Cyprus do to wrong foot the Troika?

Please understand this is pure after-dinner speculation and not based on any knowledge. I was just thinking what I might do if I were in their shoes.

I think since the EUstapo is playing rough if I were the President of Cyprus I would be talking to my friends the Russians. And guess what? The Cypriot Finance Minister is alleged to be on his way to Moscow!

What would I be going there to talk about if I were in his shoes? I think I would be talking to them about what they would pay in return for offering them a long lease on port facilities in Limassol. I would ask if Russia could see some advantage to having a 50 year lease on a military base for a new Mediterranean fleet in Cyprus?Especially in combination with the other thing I would talk to them about – which is Gas exploration and pipelines.

The Cyprus gas field, Aphrodite, has been causing great ill-feeling with Turkey for a while. How, I might wonder, would Russia like the Russian company Novatek, which is already negotiating for access to the field,  to be granted a far larger even dominant interest in preference to rival European companies?  I would think to myself I don’t need to sign anything yet, I just have to let it be known in Europe that I regarded it as ‘neither ruled in nor out’. Let them wonder about what that would do to the nasty power game already being played out around the gas fields off the coast of Gaza which Israel is already trying to claim as its own or at least assert control over. As well as Turkish claims and of course the vexed problems of pipelines running through Syria.

Imagine if the West manages to over-throw the Russia friendly regime in Syria and get European hands on any pipeline only to find Russia back in the region via Cyprus?

Given that Russia has a lot of dirty financial laundry already in Cyprus and a lot of tax avoided billions possibly still at risk there (unless it was spirited away before the bank freeze- you never can tell) might I interest my Russian friends in saving their billions from being seized by European banks, and get to buy themselves a lovely thorn in Europe’s side for the price of a bail out?

Oh the mischief! Oh the delight in watching the EUstapo blanch at the very thought.

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19 Responses to Cyprus versus the EUstapo – a mischievious idea

  1. sheepshagger March 19, 2013 at 9:45 pm #

    That suggestion would be win you the Golden Spirtle.

  2. Fran Crowe March 19, 2013 at 10:04 pm #

    Thanks David ,this is the most sensible article I have read over the past 3 days or so.

    For sure,the Cypriots have the ball back in their court now, and as long as they
    hold their nerves,the EU/IMF/ECB robbers have been exposed for exactly
    what they are ,and what the had (maybe still have?) in mind for ALL European citizens.
    This was never just about Cyprus.

    Enough is enough. I’m off to join the Ballyhea protest next Sunday. Something I should
    have done a long time ago.

  3. Charles March 19, 2013 at 10:16 pm #

    By coincidence the Russian navy has just sent 6 ships for a permanent presence in the Mediterranean. Could they divert to Limassol should Tarsus not now be a valid option owing to the possible downfall of Assad . Did the Russians have a premonition or is it all a plan on their part ? I tend to think that they were reinforcing Tarsus and struck lucky for the sake of a few billion fiat Euros . Will Angela sleep tonight ?

  4. mutonic March 20, 2013 at 2:09 am #

    And now it seems that New Zealand wants to jump on the Cyprus-Remedy bandwagon.
    In fact, NZ politicians thought of it before the Eurocrats:


    Here the Reserve Bank of NZ on the Open Bank Resolution (OBR) which has been in the pipeline for at least 8 months:


    That hiding place under my mattress seems evermore enticing

    • John G March 20, 2013 at 2:33 am #

      The RBNZ is full of crafty little deals for the benefit of the (nominally) Australian banks that operate here.

      They’ve allowed the banks to issue “covered bonds” to unnamed overseas interests which basically put these bondholders at the head of the queue in the event of a default or write down. Stinks to high heaven.

      • Patricia March 20, 2013 at 6:53 am #

        If a bank has covered bonds and then collapses those bond holders can take their cut from our deposits and so i would bet that the 10% they are saying would occur under the OBR would be much larger than that.

  5. Buck Turgidson March 20, 2013 at 3:29 am #

    I’m wondering if the Russians are using the time the banks are shut down to do just what you said and that is spirit their laundered money back to Russia. I think the banks could be in the process of being plundered by the Russians leaving the poor Ceteians (or whatever they are called) broke..

    • Jason March 21, 2013 at 8:51 pm #


    • Buck Turgidson March 26, 2013 at 8:05 pm #

      I’m not the only one with this opinion….read on

      Why now, when everything is supposedly fixed and when the impression of stability is paramount? Perhaps the reason is that as CNBC’s Michelle Caruso-Cabrera reports from Cyprus, there is now an rumor that the “other” bank – Bank of Cyprus – may also be on the verge of liquidation.

      While this is unsubstantiated for now, it would make sense in the aftermath of yesterday’s confusing announcement of a select bank reopening today, followed hours later by an extension of the bank closure through Thursday (at least, likely longer), but more importantly, following reports that Russian depositors may have already long pulled out their cash from Cyprus, meaning not even full impairments on all uninsured depositors will be enough to cover the capital shortfall, with the only option being impairment of the insured depositors after all… or bank closure.

  6. Enexoumeypothesi March 20, 2013 at 11:52 am #

    Very good said David. I don’t object to any of your suggestions as long as Russia guarantees our sovereignty and security …. I’ll just name 2 countries that could screw us AGAIN : UK & Turkey

    • Golem XIV March 20, 2013 at 12:06 pm #

      Gazprom has denied they were in discussions. I love a good denial.

      • AndyGood March 21, 2013 at 2:46 pm #

        Second rule of politics : Never believe anything until it has been officially denied…

  7. Bakasone March 20, 2013 at 6:43 pm #

    The Russian billions have never been there. The oligarchs only maintain offices on Cyprus, they are incorporated in Cyprus, but they do their banking in safer places. Only the ones who can not show where their money comes from depend on Cypriot banks. Russia’s exposure to the island state appears to be smaller than expected. I wouldn’t know why Putin should ge involved.

    • Golem XIV March 20, 2013 at 7:45 pm #

      Hello Bakasone,

      You are right that many of the companies incorporated in Cyprus have their accounts in banks in other countries. This is true but official figures do suggest there are still quite a number of billions actually in Cyprus. Or rather were in Cyprus.

      I think what worries them all Russia Cyprus as well as the EU is if the dirty details about how much money laundering has been done and who by, were to came out. Too many details could come out of Cyprus if anyone cared to look.

      So far no one has looked. EVen when specifically asked to.

      Same in the UK.

    • Enexoumeypothesi March 21, 2013 at 8:36 am #

      maybe because the Kremlin bureaucrats stash their ”earnings” in Cyprus?


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