By Michalis Zaouras on April 10, 2013

Cyprus Sells gold reserves valued at 400mn Euro

The recent announcement is very worrying. What are the implications? Without gold reserves there is no possibility of a Euro exit neither the threat of it. It also increases the control of the ECB to the Central Bank of Cyprus since an important tool to increase money supply within the country is foregone (and tackle future liquidity issues). As a consequence I believe that any negotiation (bargaining) power, through a potential Euro exit, that Cyprus officials have on future demands of Troika has gone as well. Can we do any worse?

2 comments:

  1. Well if this is the news, we can say that Cyprus is really in great trouble. You will not sell gold unless you see that this is the only solution to your financial problem.

    united states financial crisis

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    Replies
    1. Indeed, and becomes even worse day by day because of the capital controls (which were imposed in order to avoid a massive bank run).

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