uh... kind of when it's a crisis uh... uh...
uh... over the past i think beginning last week
uh... and then meet at the nishal response to the six to the supriya
banking crisis
was basically to restore liquidity in the banks by imposing taxes on every
single person savings in the bank
including from the lowest level depositors
so people obviously were rage there was a huge reaction against this uh... and
now uh... the de euro zone in the separate government has come up with a
new bailout package which will basically
wind down site purses second-largest a bank
and
under the agreement all deposits of lesson less than one hundred thousand
euros will be a secure so all those without deposit celeste unwanted one
hundred thousand uros will not
uh... pay any tax or have a levy imposed on them
uh... and then the the of lackey bank which is the uh... second largest bank
in cyprus will be wanted to know
uh... to sort of uh...
restore liquidity and restore the system i i think it's interesting you know
uh... there was a fear of contagion but cypress obviously isn't
gary tiny tiny portion of the e_u_ economy
uh... i think that this only sort of the the kind of broader lessons here first
of all one is that the initial proposal to levy a tax and everybody is shocking
and yes just another kind of classic and really crude example
of i mean if externalizing the losses obviously
uh... russia doesn't like uh... disagreement necessarily because a lot
of the large depositors in separate banks are russians
uh... so there's a kind of questionable short of money source incident cypress
and looks i purses had a very responsible banking policy which in fact
they've
uh... based off of the kind of deregulation liberalization that we have
followed
uh... so it's sort of caught up with them in that way
uh... i think the other end of the other kind of important take away tears in the
sort of broader euro zone which is that you could almost look at
you expansion
uh... in some respects is a bubble as well
uh... because you basically have a lot of oc countries coming in in getting
kind of cleared for you membership
clearly did not meet the standards that the e_u_ would establish for membership
in terms of economic performance in terms of lack of corruption
terms of transparency
and you know one of the things that's very important ability today reminders
is not only and look ahead to be clear
there is corruption in places like cyprus and greece and spain and portugal
there is serious inefficiency in there is some really big problems in those a
country's bureaucracies
but when you look at places uh...
like again increase in spain being a good example of this the kind of had
realestate booms
uh... at and a lot of speculation
that led to these crated led to these crashes or in cyprus with a deregulated
kind of casino banking sector
the same
kind of quarry euro zone countries like germany that now are imposing really
brutal austerity uh... on places like greece
profited immensely
real estate booms ag in places like grace
all of the contractors building contractors building equipment
loans bank liquidity uh... that places like greece needed
to sustain housing bubble or a fake boomer whatever else
uh... was supplied by the germans and supplied by the quarry euro zone member
so now they kind of turn around and
uh... you know are imposing really harsh austerity in giving a lot of lessons
about responsibility but it wasn't like they were profiting um ensley
uh... from the irresponsibility of the southern of the southern some countries
and then also the fact that these lot of countries are sort of cleared for you
membership
even though there was no way
uh... that they were meeting other standards to begin with actually think
that the deal that they've
ended up striking insight and cypress knees probably
uh... i best case scenario because
orderly crashing and being kind of defaulted out of the year ozone would
certainly be
totally devastating for cyprus i don't know necessarily how much of the
contagion i would've had across europe
uh... but it certainly would have hit cypress even harder than it denim then
what
uh... dense hitting cypress now
uh... then obviously though the initial proposal simply imposing a levee and
everybody was uh...
was ludicrous and i think actually it wasn't even a euro zone
idea i think that that was the initial response of the uh... conservative
government high-end cyprus so at any rate um... it looks like their debt
crisis being addressed to the obvious is going to be a lot of pain as a result of
that
and uh...
just more consequences of a deal scripted banking sector
i mean that's
really what this just keeps coming down to an again i mean i know this is like
endless coding and it's like a signpost on the show the like libertarians
libertarians libertarians
deregulated banking sector like
example three thousand
million thirteen of
that consequences
and writer things are going great over there
actually libertarians said
were just ridiculous at the port to have to do this
thank you to regulate
spot that helps
who do julio
moradabad report eleven
banking deregulation might not be such a good idea for an economy banking that
which worked so well everywhere else by now
european novel nominees probably just or something culturally outside percept
almost as if
people expect us to
book back at history
and see what his work and what hasn't
and taken things from there
passions
part of the history of this community
now but i think i a m actually in some ways with some people pointed out is
that you know cypress implemented this aggressive deregulation the under wrote
dot greece they have all this kind of questionable russian all of our
committee for dinner
and it did the the real question is actually how did cypress as this little
small you know
a bifurcated island state
how did take five extreme yours for their banking institutions the claps
after-hours free-market baby
the free market at
maybe we would have collapsed five years from now if it was for the free reprieve
from the true free market system just like free market now select market unix
market outlets people take responsibility not smart
we should all be more like separate split but not exactly