Bleak mid winter March 18, 2013 at 6:10 am
This is definitely in Caspar David Friedrich territory.
Update. Talking of being out in the cold, the Cyprus depositor bail in is generating a lot of comment this morning. The general view seems to be that haircutting uninsured deposits, while painful, would be reasonable; but the current proposal to also haircut insured deposits is a bank run generator. I tend to agree, but it seems that the former was the IMF position, while the latter was chosen by the Cypriots themselves (HT Coppola Comment for the link). Even if that is true, it’s dreadful policy. As Tim Duy says, it is hard to see the assault on Cypriot depositors as anything but a step backwards for financial stability in Europe.