Running with Rubles....

[exedir]

OK, so this is a story about money, first, last and always. And yes, impacts world markets, such as Wall Street because of what it does and what it means. And, no, the headline story isn't really the story.

Cyprus is a backwater, well, an island in the Mediterranean that has an important historical place in civilization as we know it. But lately it has been a place of strife and civil unrest. Once made independent, a civil war broke out that almost caused a land war with Greece and Turkey. The solution was to partition the island between the native Greeks and Turks and leave Cyprus a poor, struggling country with few resources other than fish and land. Then came the European Union and the island's chance to be a part of Europe and get the financial support the country needed. And of course, they spent it, all of it and got into debt doing it.

In the meantime, money needs a home, a good home and a very private one when the money comes from...., well, needs a home. After the revolution, both of 1917 and 1990, the Russians' money needed a home, one where the weather is good and the beaches inviting, and where their money was safe, safe from the Russian state and everyone else and a banking system that would be able to move and clean money no matter what the source to other investments and financial dealings. And Cyprus has been such a home, until today.

Now, for those that live on the grassy knoll, things become interesting. As a part of a €13 billion EU support package for Cyprus, Cyprus had to make a contribution, and that contribution was to take(confiscate) 20% of all private deposits in Cyprian banks. So far, not a pretty picture on the streets as to what and how the Cyprus government is going to comply with the EU requirement. But it is more interesting than that, part one of this is the Germans having the Deutsche economy used to draw a line on the sand as to what it is going to take to prop up another indolent Mediterranean country. However, the biggest part of this, is financial vectoring, that is the watching and tracking by the international banking, intelligence and police organizations where the rubles are running from, to and by whom as a bright light is being shined onto the darkness of what was the Cyprus banking business.

[LoveLife&Laughter]

The run on the banks is in all the news, almost as bad as the run on guns and ammo here since Obama won again.

[exedir]

Da, comrade....er, citizen of the Free and Great Russian Federation, those Germans are on the offensive, but reportedly the Russians have a weapon, and it is the cold, and the heat.  Their weapon, gas, natural gas that Russia supplies to those in the EU given that it can't come for anywhere else.

So, this is going to get interesting!

[exedir]

Within the day we will see how the people of Cyprus are going to deal with this crisis and many are speculating that they are going to handle it badly.

What happens tomorrow is but a reaction to what is still facing Europe and the EU, is the entire concept financial viable. 

In the end, Europe will have to decide if it can have the political will to deal with profligate and uncontrollable use of government debt to maintain a standards of living that is not sustainable and with the expectation that those that have the wealth in the EU will use the wealth on others, the classic giver/taker argument.  

The most immediate impact will be a flight of money away from Europe and to the United States to be parked in our financial markets, inflating the dollar and decreasing borrowing costs with other people's cash while we continue to live in an artificial financial world not created by opportunity, but created by fear.