Mar
19

Cash Crunch

The Cyprus fiasco shows us two things. First, countries that don’t issue their own currency simply cannot guarantee bank deposits as they have no control over their monetary policy. It also shows that monetary unions cannot survive bank runs. The upshot, there will now be a calls for a euro-wide bank regulator (like the FDIC) to prevent bank runs and eliminate the possibility of a nation quitting the euro.

Share This Post
Facebook Twitter Email

Speak Your Mind

*