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It would be pretty ironic if the Cyprus bailout of 2013 will noted in history books as the event that lead to the collapse of 21st century banking (next up bank
by codesuela 14y ago
It would be pretty ironic if the Cyprus bailout of 2013 will noted in history books as the event that lead to the collapse of 21st century banking (next up bank runs). Is it probable? No. Is it possible? Maybe.
- adestefan 14y agoHere are your options: lose all of your money or lose 10% of your money. What do you choose?
- codesuela 14y agoOption 1: Make rational decisions and rely on everybody else being rational Option 2: Panic and make rash decisions
- jan_g 14y agoI also think that there are two clear options: Cyprus gets a bailout under ECB terms or Cyprus doesn't get a bailout and faces insolvency. It seems that the government decided that the first option is preferable to the second one. The second option would almost certainly lead to civil unrest, because it would probably mean that teachers, doctors and other public employees (also pensioners) wouldn't get payed next month. Of course, the first option might also lead to civil unrest ...
- adestefan 14y agoThere's a large difference between "would" and "might."
- handelaar 14y agoActually there's a third option: wire all your savings immediately to London.
- justincormack 14y agoThe banks are closed and electronic transactions disabled.
- alexmic 14y ago- lose 10% of your money Allowing the haircut will lead to bank runs which will cause the banks to go bust anyway. There's a high change that it will also cause bank runs in other countries like Spain, Italy and Portugal. Spanish people are already in the streets protesting. "Trust" will be gone. Cyprus is systemic, whether they want to accept that or not.
- Nightrider 14y agoLet me ask you this: would you deposit your rent and bill money into a bank you trust to not give it away 90% of the time?
- deleted 14y ago[deleted]
- rheide 14y agoPerhaps not the collapse of all banking, but it could well be remembered as the first direct cause of the EU breaking up into separate countries/areas again.
- deleted 14y ago[deleted]
- paganel 14y ago> No. Is it possible? Maybe. This eerily reminds me of the bank run on Northern Rock, in August 2007. I was working for a mortgage broker at the other side of Europe at that time, and I was saying to myself: "hey, that's bad for those poor fellows, but it cannot have that big of an impact on the rest of us, it's just a bank in some god-forsaken corner of the UK". One year later Lehman went bust.