Click here to access article by Stefan Steinberg and Chris Marsden from World Socialist Web Site.
I have been trying to get a handle on this latest banking crisis in Europe which is having rather widespread reverberations across the financial world. I am no financial analyst, but in my opinion this piece provides the best single summary of what is going on.
The banking collapse in Cyprus appears to be the next financial boil that has erupted on the body of Europe. It has financial experts, investors, and ordinary Europeans in a real panic this morning. What is new about this banking crisis is that it is the first time that ordinary savers are being asked to cover bank losses. Ordinary Cypriots woke up this morning to see that they couldn't withdraw money from their bank accounts, and that their life savings are at risk of being confiscated to payoff bank mismanagement and banking bets gone bad. They are pissed off big-time as seen here.
There is also a lot of money from major foreign money sources that has been stashed in Cypriot banks probably as a way of avoiding taxes and laundering money from illicit sources. This is especially true of Russian plutocrats. And, the Cypriot banking crisis has many capitalists across the world shaking in their boots at the possibility that this could spread like a contagious disease to many other countries.
The settlement that financial elites ensconced in the European Union and other financial institutions want is a class based one: they want to confiscate the savings of ordinary citizens and small businesses in Cyprus, regardless of deposit insurance coverage, to participate in the bailout, meanwhile leaving holders of Cypriot bank bonds go without any penalty. Then, it is expected that severe austerity measures and the sell-off of sovereign assets will follow for the country as has happened in Greece, Spain, Portugal, etc.
I also recommend this, this, this, and this regarding the crisis.
