What makes Cyprus somewhat different is that its banks are utilized by Russian oligarchs to stash their money in secret accounts; Russian President Vladimir Putin’s angry response may reflect the fact that some of the money about to be taxed is his. But one Russian billionaire got it right when he referred to the action as a “Pandora’s box.” Cypriot banks are invested heavily in Greece’s recently restructured government bonds. Portugal, Spain, Italy and others are living on the edge.
Can’t blame Germans and other EU members for resisting bailing out these fiscally irresponsible countries without demanding that their citizen/voters share the cost. Who elects these socialist tax-borrow-and-spend governments anyhow?
Here in the USA, we also have to wonder what our government will do as its own debt reaches unsustainable heights. Imagine China demanding part of every American’s personal savings accounts in return for yet another Chinese loan to cover what our country spends beyond its revenues. Of course, our own central bank, the Federal Reserve, also eats up the value of our savings by inflating our currency.
Suddenly, Congressman Paul Ryan’s new budget, that begins to address our deficit, may not seem quite so dramatic to its knee-jerk opponents.
Nah. I know what most Americans think if they see a reference to this crisis: Where’s Cyprus?
I happen to know because I lived in Greece soon after Cyprus became an independent nation, with major internal dispute between Greek and Turkish Cypriots. It was part of the Cold War, as the Soviet Union had influence there — and apparently still does, though in a different way!
Because of my past interest, my ears perked up when someone at a party last Sunday mentioned the new crisis and recommended we all watch the European markets when they opened on Monday. I was busy in 2008 and almost missed the banking crisis/fiscal meltdown as it almost happened, didn’t want to miss this one!