Wednesday, March 20, 2013

Cyprus: Day Four? (Thursday)

It'd be safe to say that a whole lot of nothing occurred here today (Wednesday).  The finance minister for Cyprus is still in Moscow and trying to hammer out some deal for cash. The political folks back in Cyprus say they might come to run another bill up test the waters on taxation again.....maybe this time with a lesser rate for those folks with limited cash in the bank (maybe a three-percent deal for those under a 100k....but it's all talk and no substance mostly).

What is now guaranteed....the banks simply will not open on Thursday or Friday.  Monday is a off-day.  So they've bought almost five more days to argue over a solution.

Meanwhile....almost daily now, there are flights bringing in cash from the stock up the ATM machines around the island.  There aren't numbers, but I'd be guessing at two thousand such machines around the island of one million residents.  Once you load a's probably empty within two to four hours.  Folks are trying to be orderly about this, but the whole mess has changed lives in a matter of hours and days.

It's reported that grocery shops are requiring as much as possible to pay in cash.  They don't want your credit card or ATM card used.  They need hard cash to pay for bills now.  If you were trying as a businessman to leave the island and get airline'd likely have to show some cash to get the ticket at the airport.

Oddly enough, Cyprus got around to admitting that the energy minister for the country is in Moscow.  The original comment was that he was simply there to talk on tourism (a long forecasted trip).  The story doesn't match up with comments.  So the thinking is that they are very serious on the topic of allowing a strong Russian deal on natural gas and oil.

One of the alternate ideas being tossed around is that the government would create a vehicle where they could assume partial or full control of some of the independent-but-government-controlled pension funds.  There's some belief this would roll up a loan to the gov't.....maybe with no interest attached.....and they'd pay it back.  The amount here?  It's questionable because different groups see this as being as low as one billion Euro and some suggest up to three billion Euro. My humble guess is that folks on pensions in Cyprus would be sitting there with a very hostile feeling of what was taken away, and only promised a return one day.

The biggest shock to some Cyprus residents are the number of foreign journalists who have shown up....with cash in their pockets.....and reporting what amounts to the wide array of information that basically fits onto a 3 x 5" card.  Somehow, each is getting their three minutes to broadcast to the world, and then spend the rest of the day begging for something to happen to get another on-the-spot telecast.  The locals, as I would speculate, probably caution these guys....nothing ever happens at a fast pace in Cyprus.

The German angle today?  There's a bit more emphasis on Chancellor Merkel being the 'evil character' in this whole matter.  You get the impression that "kick-the-Germans" will be a prevailing attitude until this matter is closed off and solved.  Deserving of any of the bad press?  It's hard to say.  Some comments from the leadership might have been soften more over the last weekend.  But this isn't a situation that you anticipate or can easily grasp.

More soap opera to be anticipated.

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