RIP The Euro
Robert Peston mulls over the Cyprus ‘bailout’ in The rescue of Cyprus won’t feel like one to its people.
The bottom line is that the Euros in Cyprus are no longer ‘real’ Euros, meaning that Cyprus has a separate currency that they don’t control. No one is going to bank in Cyprus, and large depositors are probably going to move their money out of Spain and Italy as well.
Cyprus would have been better off exiting the Euro on their own terms, than what was imposed on them. There isn’t going to be any money available for the normal loans that an economy needs to function, so Cyprus is going to go downhill rapidly.
This means that Russia is going to get a great deal on developing Cyprus’s natural gas deposits, and Europe is going to get screwed.
March 25, 2013 4 Comments
