Nouriel Roubini Blog: Cyprus: Capital Controls & Deposit Freeze Is The O...:
"Capital controls & Argentine-stlye deposit freeze (Corralito/Corralon) unavoidable in Cyprus given lack of a bail in deal. Only wa...
Sorry Nouriel, but what should have happened and didn't, was that the EU and ECB should have stepped up to the plate and fixed this situation long before it reached front and centre on the global stage. Imagine if the FED decided not to bail out Nevada; for example, because of suspected nefarious activities. The Union and Central Banking functions would fall apart.
Cyprus is less than .2% of the EU's GDP, yet they let this economic scratch turn into a flesh eating disease, that exposes the EU and ECB as "name only" institutions without functional substance. Where were the oversights in the first place?
This is just bad management on all fronts, from start to finish. The cost could ultimately be the sinking of this whole European experiment forever. Which is startting to look like the most sensible solution to the situation with each passing crisis.
Time to bite the bullet.
Dr Peter G Kinesa
March 21, 2013