Friday, January 25, 2013

First Domino to fall

That domino might be Cypress.  The Europeans are forcing the issue with the largish island that is a country in the Mediterranean.

As Tyler Cowen at Marginal Revolution, who I frequently hat tip, asks:

The Big News from Today
Tyler Cown, Marginal Revolution, 25 January 2013
However small a country it may be, does anyone at this point want to be on record setting any number of precedents, one way or the other?...“Creative ambiguity” is getting harder to manage all the time. What would a depositor haircut here imply for Greek and Spanish banks?
Recall that before Lehman Brothers went down it was Bear Stearns that they rescued first. They got so much grief over that rescue, that they thought they could afford to let Lehman go: that is was not essential.

We shall see. In my opinion, it will all have to be let go at some point, but what king of landing you have is an option.


PioneerPreppy said...

Cypress is a good candidate. It will be one that most people ignored in my opinion which is why Greece hasn't officially fallen yet, they simply will not let it or let anyone admit that it has.

Now Britain is discussing leaving the EU.

russell1200 said...

Pioneer: Reports in WSJ make Greece sound like a slow apocalypse in progress. And Greece is closer to its rural past than we are, and a lot of their stories revolve around previously sucessful urban types, back on their aging parents farm with the chickens.

For the record, Cypress has universal conscription of men, but not women. They allow women into their army (I think they call it the National Guard), but I don't know if they are thought of as combatants. Given that their likely war scenarios involve deadly encounters with the Turks, I am not sure that their official status would matter.