Financial Markets Haven’t Freaked Out Over Cyprus, But That Doesn’t Mean They Won't

Monday, March 18, 2013 15:30
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Financial Markets Haven’t Freaked Out Over Cyprus, But That Doesn’t Mean They Won't

Financial markets were stable Monday, not really panicking over reports over the weekend that international authorities will force losses on depositors in Cyprus’s banks.

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The modest declines in financial markets Monday following the Cyrpus news are a sign, says Neil Irwin in today’s Washington Post, “that global investors are betting that the losses being forced upon Cypriot bank deposits will be a one-off situation, and not form a precedent for future aid to banks in Greece, Spain, Portugal and beyond.” However, Irwin says that initial reaction may be proven very wrong, recalling an earlier chapter in Eurozone’s financial crisis that sent the bonds of Ireland, Portugal and Spain into a tailspin.
 

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