Newly elected President of Cyprus Nicos Anastasiades on 3/3/13, his first day in office:
I want to be absolutely clear. Absolutely no reference to a haircut on public debt or deposits will be tolerated. Such an issue isn’t even up for discussion.
Finance Minister Michael Sarris also said this on depositor haircuts:
Really and categorically—and this doesn’t only apply in the case of Cyprus but for the world over and the euro zone—there really couldn’t be a more stupid idea.
Two weeks later, Anastasiades agrees to what he said wasn’t being considered, and engages in outright theft from the people of Cyprus to ensure unsecured and uninsured debt obligations are paid.
If I lived in Europe, particularly if I lived in Ireland, Greece, Spain, Portugal or France, I’d withdraw every cent I had in any bank account as soon as the banks re-open and put it in Hong Kong, possibly the last place to secure assets from grabby governments. Or under my mattress.
This is so incredibly stupid, so destructive to markets psychologically, that it can’t possibly be anything other than a trial balloon, to see if it can be pulled off in a tiny market before moving to the bigger ones.