Comments on: Will Putin attempt a last-minute Cyprus rescue? http://blogs.reuters.com/anatole-kaletsky/2013/03/25/will-putin-attempt-a-last-minute-cyprus-rescue/ Sat, 03 Jan 2015 16:42:55 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: OWolf http://blogs.reuters.com/anatole-kaletsky/2013/03/25/will-putin-attempt-a-last-minute-cyprus-rescue/#comment-880 Mon, 25 Mar 2013 23:24:12 +0000 http://blogs.reuters.com/anatole-kaletsky/?p=308#comment-880 If Cyprus cuts ties to the EU – it loses much of its attractivness and stability. Add unresolved problems with a NATO-member Turkey. What about english military bases?
No matter how much money Russian Federation injects into Cyprus, it can never control it. At the same time – it’s too much responsibility. Folks from russian streets (and UralVagonZavod :) will not understand such step either.

I don’t think that BoC and Laiki were so popular among Russians. Their image was damaged long before March 2013. But, there are several subsidaries of Russian banks on the island which are suffering much more from the unexpected bank holidays, than from a failure of local banks (no matter how big they are for the island).
Maybe I am wrong. Just my personal opinion backed with stories read on the internet.

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By: UauS http://blogs.reuters.com/anatole-kaletsky/2013/03/25/will-putin-attempt-a-last-minute-cyprus-rescue/#comment-879 Mon, 25 Mar 2013 19:18:32 +0000 http://blogs.reuters.com/anatole-kaletsky/?p=308#comment-879 Just one question that, in my view, makes the entire proposed endeavor quite questionable (pun unintended): why the wealthy Russians kept their money in EUR in Cyprus(!), but not in Rubles in Russian banks?..

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By: UScitizentoo http://blogs.reuters.com/anatole-kaletsky/2013/03/25/will-putin-attempt-a-last-minute-cyprus-rescue/#comment-878 Mon, 25 Mar 2013 19:03:24 +0000 http://blogs.reuters.com/anatole-kaletsky/?p=308#comment-878 Putin and his thugs will review any opportunity to expand their “business” and that includes killing the people nationally and internationally that disagree with them. If you think that thugs care about history, review Stalinism.

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By: Urban_Guerilla http://blogs.reuters.com/anatole-kaletsky/2013/03/25/will-putin-attempt-a-last-minute-cyprus-rescue/#comment-877 Mon, 25 Mar 2013 15:08:24 +0000 http://blogs.reuters.com/anatole-kaletsky/?p=308#comment-877 I think this is a real possibility. If he speaks to Washington, agrees to cut assad loose in return for their aquiescence, the EU really would look irrelevant.

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By: oditorium http://blogs.reuters.com/anatole-kaletsky/2013/03/25/will-putin-attempt-a-last-minute-cyprus-rescue/#comment-876 Mon, 25 Mar 2013 14:34:04 +0000 http://blogs.reuters.com/anatole-kaletsky/?p=308#comment-876 I don’t quite follow that argument.

Given the precarious state of the Cypriot banks, the equivalent of €6bn would have to be contributed as capital (aka ‘gift’ at this stage) not in form of a loan. On top of it, Russia would need to provide significant liquidity – call it €50-150bn equivalent – to cover deposit losses literally overnight.

This liquidity would probably have to provided without any collateral, as it is likely that most is already pledged with the ECB, and would only be released if and when the ECB is repaid, which Russia would also have to do. At this point, Russia would essentially take the full balance sheet risk of the Cypriot banks, and I do not see Russia being prepared to do that.

Last but not least, funding an mainly EUR denominated portfolio in RUR would breach all kinds of regulatory triggers, and unless Russia would effectively also the the fx risk the regulators would have no choice but to wind down the banks anyway.

The way I see it, this whole proposal is a non-starter!

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By: xpat http://blogs.reuters.com/anatole-kaletsky/2013/03/25/will-putin-attempt-a-last-minute-cyprus-rescue/#comment-875 Mon, 25 Mar 2013 12:58:28 +0000 http://blogs.reuters.com/anatole-kaletsky/?p=308#comment-875 Such dreams of grandiosity!! Wake up Anatole!

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By: TobiasMaximus http://blogs.reuters.com/anatole-kaletsky/2013/03/25/will-putin-attempt-a-last-minute-cyprus-rescue/#comment-874 Mon, 25 Mar 2013 09:17:24 +0000 http://blogs.reuters.com/anatole-kaletsky/?p=308#comment-874 I think we haven’t heard the last of Russia in this affair, but one flaw in your thinking above: Cyprus parliament does not, repeat does not have to approve this deal.

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By: StigTW http://blogs.reuters.com/anatole-kaletsky/2013/03/25/will-putin-attempt-a-last-minute-cyprus-rescue/#comment-873 Mon, 25 Mar 2013 08:55:05 +0000 http://blogs.reuters.com/anatole-kaletsky/?p=308#comment-873 Perhaps there’s not as much Russian money at stake as many may think. Perhaps it would also cause a flow of cash back to Russia? Or perhaps with Cyprus being tied to the hip with EU it’s just not worth the mess. Russia may be smart to sit it out.

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By: IvoCerckel http://blogs.reuters.com/anatole-kaletsky/2013/03/25/will-putin-attempt-a-last-minute-cyprus-rescue/#comment-872 Mon, 25 Mar 2013 03:25:33 +0000 http://blogs.reuters.com/anatole-kaletsky/?p=308#comment-872 Freegold means that the euro has a gold component and a paper component and puts a “firewall” between both so that gold’s valuation as a wealth-preserving asset cannot be pulled lower by the inevitable inflation of the paper component of circulating currencies. If Putin can offer rubles to solve the lack of euros of some Cyprus banksters, this means that the ruble is convertible – into euro; thus that the ruble is equivalent to the euro; thus that the Russian central bank like the Eurosystem (the European System of Central Banks) marks its gold reserves to market (MTM) not to the model of USD 42.2 like the USA (originally, in 1944, when Bretton Woods came into force, USD 35). This means that Cyprus will be the trigger to fully achieve Freegold. Is the People’s Bank of China taking note?

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