This time, sans the Cypriot parliament as EU plays its usual card of asserting "if you jokers can't vote the way we tell you, we'll just declare that voting is unnecessary":
So having learned that Parliament would not approve a deposit levy in the name of a "tax", and that the government was deeply opposed to forcing citizens and other depositors in its banks to bear losses without the bondholders being wiped out first as one would expect in the capital structure, Germany, the ECB and rest of the EuroThieves did something innovative.One can't help but notice this is an even worse deal for the Russians than the one that had them announcing their new permanent Mediterranean fleet, and it doesn't have the support of either the Cypriot people or their parliament. I wouldn't get too excited and start going long the euro; contra the financial spin this situation is far from resolved.
They simply ignored Parliament and came up with a scheme that didn't require a vote. We'll see how this works out for them.
This, incidentally, is exactly what happened here with GM. It was blatantly unlawful to protect the UAW's pension fund, which had no senior standing while trashing senior bondholders. The government did not care and did it anyway -- and the courts permitted it.
This has been the repeated means by which you are stolen from. When you enter into an investment, whether you make a deposit in a bank or buy a bond or something else, you are buying into a capital structure in a given place with a given and declared level of both risk and potential reward. You price that risk and your willingness to enter into the transaction with the full understanding of where you are in that capital structure.
When that is unilaterally changed retroactively you are being stolen from.