Cyprus In Layman’s Terms
In case you’ve heard it and didn’t understand or have been living under a rock, in terms of financial news, not that everyone pays attention to financial news, the tiny nation of Cyprus is doing something unprecedented. They are stealing depositors money.
The news is reporting it and the most casual way possible. If they told you exactly what was going on, and what other options were available, a widespread panic would ensue.
So here’s the basics of this report. The tiny nation of Cyprus, basically serves as the offshore banking for much of Europe. They are the Cayman Islands of Europe. People deposit their huge sums there, and pay very little taxes. Because the island’s banks gets huge sums of money, they thought to make even more money by investing it themselves. Who did they invest in? Greece. Wait, are you thinking what I’m thinking? That’s right, Greece is insolvent and can’t pay its creditors, including Cyprus.
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