The € 10 billion bail-out deal has been approved by the Eurozone finance ministers, avoiding the potential Cyprus’s bankruptcy.
The spread decreases and the Stock Market cheers, after the Cyprian authorities have agreed the terms of the deal. In fact, they are now determined to earn other 7 billion euros and they will do it seizing bank deposits over € 100.000, in detriment of the richest Cypriots and the foreign investors -Russians first – who have made the island one of the greatest financial paradises down the years.
But all this reflects a European tendency to cover up the symptoms of the crisis without reaching the underlying causes, which most likely relate to the current global financial system. Indeed, Cyprus’s banks have assets equal to 800% of the national GDP, making the finances eight times stronger than the economic system from which they should be dependent. The financial system of the United States exceeded 350% of GDP in 2006 and its collapse inevitably unleashed a chain reaction throughout Europe because of the heavy amount of US stocks in the European pockets, bringing the world to the current economic crisis.
Perhaps, it is because the global financial system is tightly interrelated that the crisis has reached such devastating scale, and working out the hitches of the day does not help the world get out of it soon.
The “Cyprus Issue” has been solved and another shabby patch has been sewed on this Europe falling apart.
Everyone’s safe today, but tomorrow never knows.
di Gianmarco Capati
foto: tempi.it
Scrivi