Run! Run!, Cypriots

Central bank of cyprus

Leading the international news the past week has been the financial crisis in Cyprus. Over the last few years, a number of European countries, primarily Greece, Italy, Spain, and Portugal have been facing debt crisis’ that dwarf our own fiscal cliff and sequestration issues. The problems in those countries raise the specter of insolvency­, a worst case scenario of bankruptcy in which those countries would basically say to their debtors, “Sorry, I can’t pay you back. Nothing I can do.” This could create a domino affect involving the more solvent countries and spread worldwide.

It’s like you going to the bank that gave you a mortgage loan on your house and saying “I don’t have the money to make the payment.” Eventually the bank comes and takes your house and you are out on the street, unless someone comes to the rescue and helps you make the payment.

In a very complicated not to say convoluted way, a number of those large European countries have been having those issues. To this point, they have been getting bailed out (have you been hearing that word a lot lately? If your name is in the same sentence as the word bailout, it’s not a good thing,) by their healthier European brothers like Germany and France. So far it’s been working, although the European financial pot is simmering. Too much debt, and possibly not enough bailout to go around.

Which brings us to Cyprus which to be honest with you, I wasn’t even aware was a country. I thought it was kind of like Monaco, Hong Kong, or Puerto Rico. But it’s a country sure enough and its banks are in big trouble. Bigger trouble than the larger European countries, and probably because Cyprus is much smaller, that trouble flew at least in the public eye, under the radar.

It’s all surfaced now though, because it was forced to, like a hunted submarine whose cook begins clanging all his pots and pans around, and caused a bit of a panic not only with its citizens, but with the world economic community in large.

Bailouts to Cyrus from the larger countries (which are really loans in themselves that come along with strict controls, and at a high price,) were in question.

The approach that Cyprus chose to demonstrate it was doing all it could to remain solvent was to attempt a tax on the money that citizens held in bank savings accounts, to the tune of 10%. Can you imagine your government coming into your savings and seizing 10%? This is what the citizens of Cyprus faced. (Now it’s true that a lot of savings held in the Cyprus banks is laundered Russian money, but that’s another issue.) The concern of a run on the banks and even riots loomed. Fortunately for now, Cyprus decided to tax only the wealthiest account holders  (which may be some of those Russian money launderers. Don’t think I’d want to be a Cyprus bank regulator right now.)

So now the connection to our Christian mindset.

Over the weekend, I listened to a National Pravda Radio (NPR) news story highlighting the mindset and possible plight of Cypriot savings account holders who are only allowed to make small withdrawals each day to avoid bank runs. Here are some observation from the commentator:

  • The Cypriots have a fractured psyche in possibly having 10% of their savings taken
  • They are nervous about the security of their savings
  • They have been forcedto have only enough money to live day by day
  • The crisis has forced a trimming of expenditures to just the necessities
  • There is complete uncertainty about their future

Are you seeing where I’m going with this? While listening to all this, I was thinking what if Jesus was standing close to the around-the-block ATM lines and the good citizens came to Him in protest? I really can see Him responding – “Yea … so?

More next time.

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