Cartoon: A Forbidden Romance

A very good piece of work from one Isaac Duffy, keep up the drawing.

Good Morning Cyprus

Cypriots today received the best wakeup call ever today. The Eurozone has put a one off levy on all savings of 6.75% for any one with less than €100,000 and for anything exceeding that 9.9%. What a great day for the people of Cyprus.

Cyprus is broke, the country has a debt of €15,000,000,000, 74% of GDP. Cyprus has received a loan from the ECB as a bail out and a team of finance ministers with the President, who was elected recently 'to deal with the countries debt', are carrying out a levy on all savings on Tuesday to help pay off the debt. The Euro Team and Cypriot Government have judged that the banking crisis is over so it is safe for this to happen.

If we disregard the whole taxation and surprise thing about this levy, which is bad enough (I hope you have been filled with disgust from the start), there is one big problem. Firstly Cypriot banks are really not that safe this month the two largest on the island posted a €4.5 Billion loss, almost 25% of GDP in the country. Banking has never been in a worse shape, the officials have great timing.

Now it is even worse as everyone is withdrawing money. People are fighting through queues to avoid this 'robbery'. There would have been a run on the Banks if it were not for many of them closing their doors to stop the money from leaving. People can now only use ATMs and those few banks that remain open. And do you think people will use Cypriot banks again? Unlikely. Anyone with €100,000 will definitely be looking for a foreign bank in the future. Who's to say this won't happen again? So now Cyprus has a capital crisis. It's all going down over there.

And guess who these Banks have lent to massively, our good old friends the Greeks. So it's going to go wrong for them even more now. What is more Greece, and any other indebted country, should watch out. This great policy may come to your shores too.

And now for the icing on the cake. Cyprus is about to raise its corporation tax, clearly the best way to get businesses to grow. Who runs this country, the Labour Party? Oh no wait it's the Eurozone and they're just as bad. This is just a prime example of what's wrong with European economics. But I'm not surprised, half of all left wing politicians are ex-Euro Communists.