Case by case. In Cyprus, I'd say put these banks into some sort of bankruptcy. Give everyone haircuts in whatever order a court (remember rule of law?), not so

Case by case. In Cyprus, I'd say put these banks into some sort of bankruptcy. Give everyone haircuts in whatever order a court (remember rule of law?), not some dark room full of politicians, beuarocrats and bankers decides is correct. Then have the Cypriot government or the EU (we also need to figure out who is liable here) make good on the promises to insured depositors. I don't see how dooming the next generation of Cypriot taxpayers to high taxes and low public services in order to save uninsured depositors who benefited from the high interest rates these risky accounts yielded from taking a haircut. Not from a legal perspective, or a moral one. It doesn't sit well with socialism or with capitalism. I don't buy the argument that it will in any way preserve choruses ability to borrow in international markets.