Cyprus

Cyprus Banks Set To Reopen, To Serve As Glorified ATMs With A €300 Cash Withdrawal Limit

Zero Hedge,

17 March, 2013

Tomorrow Cyprus banks will reopen sometime around noon (they are supposed to close at 6 pm but likely will close far earlier). What does that mean? Apparently nothing much. Because according ot various newswires the withdrawal limit at all banks will be €300 per day. This means that all those daytrading wannabes who want to get stinking rich and just buy US stocks with "no risk", will be unable to buy even one riskfree (at least until last September) stock of AAPL per day!

In other words, all said "reopening" will do, is to allow physical branches to be used as glorified ATMs but with a very terrified and confused carbon-based teller on the other side (the same ATMs which a few days ago saw their limit reduced from €300 to €120). All other cash transactions will be strictly curbed, virtually no cash will be allowed to exit the island, and the what's more the government will ban the termination of the oh so ironically-named time deposits. This means that time deposits will now become "permanent deposits", even if within the €100,000 insured limit. The good news: credit card treansactions will be permitted when paying for goods and services anywhere on the island. Of course, electronic cash just happens to not be physical cash, which is why the bank is so cavalier with allowing people to access their own money. Well, electronic 1s and 0s-based money.

In other words, tomorrow's bank reopening means absolutely nothing (as ATMs had worked for the duration of the Cyprus bail-in crisis), and anyone who had hoped they could just walk in and withdraw their entire insured deposit up to €100,000 will be severely disappointed. Of course, those who had more than €100,000: Poof, it's gone, step aside please.

Oh well: such is life in the New Normal under capital controls, in which there is a unquantifiable premium for having physical cash over electronic.

Learn from it.

A LETTER FROM CYPRUS: ECONOMY SHUTTING DOWN, GOING CASH ONLY!

Silver Doctors

26 March, 2013

An SD reader has submitted a boots on the ground report on the escalating crisis in Cyprus, as the entire Cypriot economy is now on the verge of collapse:

Nowhere in Cyprus accepts credit or debit cards anymore for fear of not being paid, it is CASH ONLY. Businesses have stopped functioning because they cannot pay employees OR pay for the stock they receive because the banks are closed. 

If the banks remain closed, the economy will be destroyed and STOP COMPLETELY. Looting, robberies and theft are already on the rise.

If the banks open now, there will be a massive run on the bank, and the banks will FAIL loosing all of its deposits, also causing an economic crash.

From SD Reader tzy:

Another letter from Cyprus :

A friend from Minneapolis has a son who is in Cyprus now. Here is an email that he wrote home, describing the chaotic situation there:

Hey fam!  Things are getting pretty crazy over here in Cyprus. I don’t know if you guys have been watching the news or seen things online, but Cyprus is on the verge of economic collapse. 

Over the past 5 years the Cyprus stock market has lost 98% of its value and the country has recently entered into a severe economic crisis, considered worse than Greece, Italy, Spain, Portugal etc.. As of last week the two largest banks in the country have completely shut down and froze all wire transfers out of the banks. Walking outside every day this week I have seen massive lines of people at the ATMs trying to withdrawal the maximum amounts. Today there was a man who was trying to get money out and when he realized it was out of cash he shook the machine violently and punched the display while cursing in Greek. If these banks go under (and this may happen) ALL money and all deposits will be lost, which will completely destroy the economy and way of living here.

Last week the European Central Bank offered a multi-billion Euro bailout package to Cyprus in exchange for a massive tax on all civilian bank accounts in the country. If this goes through (and I hope to God it does NOT) It will also devastate the economy and cause a giant run on the bank. Cyprus has also looked to Russia for help because Russians hold tens of billions of euros of investments in Cyprus (and the majority of bank deposits), however, Russia declined.

As it stands now, nowhere in Cyprus accepts credit or debit cards anymore for fear of not being paid, it is CASH ONLY. Businesses have stopped functioning because they cannot pay employees OR pay for the stock they receive because the banks are closed. If the banks remain closed, the economy will be destroyed and STOP COMPLETELY. Looting, robberies and theft are already on the rise. If the banks open now, there will be a massive run on the bank, and the banks will FAIL loosing all of its deposits, also causing an economic crash. TONIGHT there are demonstrations at most street corners and especially at the parliament building (just 2 miles from me).

Many are thinking that the ECB and EU are allowing Cyprus to fail as a test ground for new financial standards.

Just wanted all you guys to know the real story of whats going on here. Prayers are appreciated (although this is very interesting to watch) many of my local friends have lots of money in the banks.