Cyprus going on bankrupt, will that affect the world?
By kingparker
@kingparker (9673)
United States
March 25, 2013 3:31pm CST
If heard about the financial difficulty this small island country gone through from last week, you will wonder, will this affect our economy, or will such fact stir a ripple in the worldwide economy also? The banks of Cyprus will go on through nationalized process, and people who deposited their money within this country's banks might lose 10% of their original deposits. It was like all of sudden, people lost FDI warranty overnight, and it might caused confidence issue on the people. It definitely will affect the economy of European Union, and I don't know if that also affect us potentially in the America side. What do you think of it?
1 response
@echomonster (2225)
• Greenwood, Mississippi
31 Mar 13
I think it's going to affect worldwide confidence in banks. Remember, the original plan was to take money even from insured deposits, though that was changed so only the uninsured deposits were affected. Still, it's scary that a government can just decide to take your money that's sitting in the bank and see absolutely nothing wrong with it. We have bank insurance because in the old days when the bank would go bankrupt everyone would be wiped out...but now the bank gets to survive while the depositors are wiped out! It doesn't really seem like too much of an improvement.
