Sunday, March 17, 2013

Sunday night update

The markets have started opening around the world and most are off about 2% which is noticeable but in light of the huge run-up we've had recently it's not that bad.

The news out of Cyprus has clearly shaken global markets.  The new numbers the government is floating are - 3.5% tax for under 100k Euros, 10% for 100k to 500k Euros and up to 12.5% for balances over 500k.  The risk is that this causes an accelerated flight of capital from areas that are considered at risk - Greece, Italy, Portugal, France  - toward places like Switzerland and Singapore and perhaps the US (which would explain the strengthening US dollar).

Banks in Cyprus will be closed until Wednesday so this story will continue to dominate the international headlines (the lack of coverage in the US is surprising).

May you live in interesting times.

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