Monday, March 25, 2013

A Very False Dawn

It appears Monday in Europe will dawn in the fullness of time and the skies over Nicosia will be tinged mit Feuer und Schwefer. A fun Spring (enforced) Bank Holiday is not in the cards. Especially as it will be the culmination, nay the dénouement of ten (count ‘em) continuous days of the banks staying shuttered. Cyprus has reverted to a cash and barter only economy.

There will be no Helicopter Mario dispensing unlimited clouds of Euro’s come Tuesday, no Euro-Solidarity Manna from Brussels, just the contrails of the Luftwaffe escorting the dejected Cypriot PM and FinMin back home from a tongue lashing at the hands of the Troika, a piece of paper signed by Die Führerin herself inscribed with “monetary peace in our time” and “Glüchlich mit dem Sparprogramm Dingem”. Without the Luftwaffe, Anastasiades and Sarris might have headed straight for Athens and requested asylum. It won’t be pretty showing up in Parliament tomorrow to lay down die neue Gesetze; to be passed or else. Signing up will guarantee Quisling status and the "or else" bit looks equally unappetizing. A tactical small heart attack and a few days im Krankenhaus could look very attractive to all alternatives. Either that or a quick application to the Cyprus Chiltern Hundreds. It’s not going to be a paragon of parliamentary democracy at work.

It will rightly be very challenging for any thinking Cypriot to wonder why they ever signed up for the Euro in the first place. Idle and blasphemous speculation wonders how things in Cyprus might now be, had they remained a British Crown Colony (see Bermuda, Cayman Islands) and allowed Sterling and the Greenback to circulate freely. Liberated to pursue all the dodgy, island tax haven deals in their wildest imagination, under the protection of HM Royal Navy (do they still have any boats in the Med – Ed?) and the light touch regulatory eyebrows of the Old Lady of Threadneedle St.

It’s not turning out to be such a good weekend for the Russkies. Looks like it could be a 40% Affens ‘aircut for Vlad Vlad’s boyos in the Cyprus banks. Of course that won’t come out of Putin’s vig. Meanwhile Boris-in-exile-in-London of Berezovsky fame seems to have been found in his bath, with extreme prejudice. Is this another strike by Vlad Vlad’s hard men with their Polonium 210 trick or did Boris just tire of this harsh and unrelenting world. And still in his prime. It seems to be getting very dangerous to go to the potty. First Alfred H had the idea, then sad Whitney Houston, then the Welshman from GCHQ/MI6 in a holdall, followed by poor Reva Steenkamp and now Boris. Not to mention Lenny Bruce and King Elvis himself. The other Boris of London has had his pants taken down on TV in humiliating style, but not while in the bathroom. What a shame Lord Paddy of Pantsdown already claimed the title. Even Georgy Markov’s umbrella assassin has surfaced 40 years later. But that was just the Bulgars free lancing. If you’re a buddy of Messrs. Litvinenko and Berezovsky it may be time to stay under the covers, or ask Roman if you can join him in his box at Stamford Bridge. At least Mikhail Khodorkovsky is getting at minimum two squares a day of borscht and vodka for free. Just shows how important it is to keep up paying the life insurance premiums to the ZAO Putin Life Co (Moscow).

How are the Cyprus cookies going to crumble over the next 36 hours? Will the Russians take their medicine and go quietly? Going is probably not in the cards; since after the ‘aircut, what’s left still attached may be subject to that infamous euphemism “exchange controls”. Which means we multiplied the number you first thought of by 40%, debited your account, but the remainder is now constituted into Cyprus government bonds yielding three fifths of not very much; payable when the gas starts to flow. In the secondary market they’ll float (sink – Ed?) to Kopecks on the Rouble. However the spinmeisters dress it up, there will then be (at least) two kinds of Euro’s. One you can fold up and use to buy a Bratwurst und Weissesbier in Berlin and one you can leave sitting in a Cyprus bank gathering dust. Some will say that Consul Angelicus Merkelus has taken her Hunnish legions across the Rubicon and has set her cap at Rome itself. Heresy is afoot.

Plucky Cyprus may have showed the way for Rome to ease its pain. The Orthodox Archbish of Nicosia has generously offered all church property in Cyprus as collateral for the national solidarity fund. Some very pretty monasteries. Does this offer an idea for the new Pope Francis SJ to show his commitment to poverty in worldly goods by offering up a mortgage on all 44 hectares of Citta del Vaticano, together with all chattels and ceilings therein, as security for a new issue of Italian government bonds? What a magnificent gesture that would be. He is after all, of Italian heritage. Lovely Christina de la Casa Rosada can eat her heart out.


Well Monday did dawn on time across the Euro-Wasteland to the sight of pitiful Cypriot ministers blinking in shock at what they just agreed (or pretended to agree). Including we learn that, in true Euro-Dem style, no further Cypriot parliamentary approval, debate nor endorsement is needed to implement the Gauleiters’ diktats. Frau Tante Angela, Die Fürhrerin’s Jillboot is planted firmly on the ministers’ windpipes. Humiliation does not come more abject. The “laws” are already in place to allow mass expropriation of anyone foolish not to have kept his Cypriot Euro’s in the mattress and for “capital controls” to apply to the meager crust that the Huns from the North have deigned to allow to remain un-plundered. Of course, the ECB’s Target2 claims are sacrosanct and must be transferred to the Good Bank. If this is solidarity, it looks a lot like Hegemonie. No indication of how long it will take Cypriot (unpaid) bureaucrats to turn all this into a well oiled machine and allow the banks still standing to “reopen” – aka allow anyone access to what’s left of his Euro-funny-money.

Will the Cypriots and their Russkie pals take all this with a bang or a whimper? Not hard to imagine some big gas pumps across the Ukraine to go suddenly on the blink. We will wait and see with great expectations.

Simon

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