Events are heating up and it is worthwhile to keep your eyes on Cyprus and Syria. Cyprus for the “bailout,” which has segued from a government fiat of taking 10% to 20% from every bank account without notice to “Okay, only the rich guys’ accounts,” to “Okay, maybe not.” Monday, March 25, the deal is supposed to be agreed upon. The banks are closed and Cypriots are not able to use their debit or credit cards. For a moment, imagine what life would be like if that were to happen to you and yours? Governments have to be stable in order to function. Civilized society functions based on faith in the system. What happens when the system shuts down? Cypriots are now having to barter because individuals have no cash and no access to it. That butterfly flapping effect? Stop and test the wind ~ hear it?
Syria, in the midst of a civil war, going on two years now, is thought to have used chemical weapons in the last week. Assad’s government blames the rebels. The rebels blame Assad. President Obama assures us that this will be investigated…. hopefully, faster and more honestly than Benghazi (Libya) or Fast & Furious (Mexico).
Richard Fernandez writes excellent analysis over at the Belmont Club. It is worth perusing his site as his astounding ability to keep up with current events and their global impact is meticulous and always worth reading with links provided to his cited sources. For Cyprus analysis, articles from March 16 to present. Here’s a quick excerpt from “What’s Money Anyhow?“:
….Because maintaining confidence in the larger global system is something that must be achieved at all costs. Otherwise the music stops and who knows what happens then?
Well we do know what happens then. Cyprus shows us. A European country goes from credit, to plastic, to cash, then barter, and then finally, unless the process is halted, to guns, knives and clubs, teeth and fingernails.
So the music must always play. Once financial rescues are perceived as simply banks bailing out each other with fake printed money the penny will drop. Cyprus demonstrates what happens once confidence evaporates. The system doesn’t just slowly chug to a halt, it implodes. Ka-boom.
One moment the banks on the island were open for business as usual. In the next instant the very same banks, physically the same on unchanged buildings and streets, were regarded as bankrupt. All that changed was information.
I have often written that the world crisis is at heart a crisis of information. The correspondence between physical things and the abstract financial system that values them has fallen out of sync. It cannot remain this way. The financial database is full of lies; and parenthetically, the political system, which is the handmaiden of the financial system, is as full of lies as well. Somehow they have to be brought into near alignment again…
For Syria and the Middle East (write about one, you have to write about all of ‘em because they are a stone’s throw from one another in any direction), surf the site itself or google “Richard Fernandez and Syria,” for a collection of the articles he’s been writing.
While I am singing Richard Fernandez’ praises, I highly recommend The Three Conjectures, where he considers what our alternatives are when options are being taken off the table, now available on Kindle via Amazon. “Can societies face the threat of nuclear terrorism without resorting to the same ruthlessness as their enemies? How can one think about the unthinkable with such issues at stake?” Again, events are moving fast and the players are upping the ante from North Korea to Iran to Russia to Cyprus. The ripples move outward.