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Cypriots are learning the hard way. Eurozone straightjacket rules entrap them. One size fits all doesn't work. Losing control of monetary and fiscal policy assures disaster. It's just a matter of time. It's hitting Cypriots full-force.
The original 17 billion bailout rose to 23 billion. It exceeds economic output. It's unheard of. According to Eurasia Group group director Mujtaba Rahman:
"There are absolutely no winners from the Cyprus agreement. Every major country and institutional constituency has been hurt, creating the potential for even more toxic and difficult" conditions ahead.
Cypriot officials have to raise more cash than expected. Eurocrats agreed to a nine billion euro bailout. IMF terms add another billion.
Cyprus has to raise 13 billion. It's over double the original amount. Depositors will bear most of the burden. They're already hit hard. Those with over 100,000 euros stand to lose 60% or more of their savings. Some may lose everything.
Small depositors are protected. At least they are so far. Perhaps not going forward. Accounts of all sizes are vulnerable. Bailout terms override promises. They're made and broken.
London's Guardian explained more. Cyprus has to contribute to its own bailout. It's entirely responsible for bearing the extra cost.
Cypriot parliament's president, Yannakis Omirou, said:
"Instead of solidarity from our European partners, we have been served poison."
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