As markets opened the concern was for a panic, as investors looked at the situation in Cyprus with grave concerns. The value of the Euro dropped sharply before recovering somewhat, and European markets opened lower, though only moderately.
The issue causing widespread concern are the actions requested by the Troika – the European Union, European Central Bank, and International Monetary Fund – in order for Cyprus to receive $13 billion bailout funds. The troika is asking Cyprus to issue a one-time tax on bank depositors – 6.75 percent on deposits up to €100,000, 9.9 percent on deposits over €100,000. While advocates justify the tax on grounds that those receiving the bailout should help pay for it, the fact is that the request tears at the fundamental issue of depositor insurance, the idea that one's savings are protected, at least up to a certain amount, from losses. This is what prevents bank runs and the collapse of the whole banking system. Not surprisingly, small depositors rushed to try and withdraw money over the weekend to prevent it being seized by the government.
Complicating matters more is the oversized nature of Cyprus's banking system, which is seen as a tax haven for Russian oligarchs. This morning Vladimir Putin's spokesman said that the "decision, if taken, would be unfair, unprofessional and dangerous."
To prevent an uncontrolled run on the banks by depositors, Cyprus has declared a bank holiday for Tuesday (Monday was already a bank holiday) and the government said that the banks could remain closed even longer as it tries to get the special tax passed through the parliament, something that appears increasingly unlikely as the government of president Nicos Anastasiades appears short of the required number of votes.
Markets have settled down a bit, however, as the scheduled vote on the special tax was postponed until tomorrow, if at all.
A new press regulation system has been agreed to in the U.K., as an agreement was reached after late night negotiations between the major political parties in parliament. The prime minister David Cameron, backed by the major newspaper tabloid companies, had tried to prevent any new regulations from being established that were not strictly voluntary; while Labour, backed by several prominent newspapers such as The Guardian and Financial Times had broken ranks and called on the new regimes to be backed by law.
"It's not statutory underpinning," the prime minister said today. "What it is is simply a clause that says politicians can't fiddle with this so it takes it further away from politicians, which is actually, I think, a sensible step.
"What we wanted to avoid and we have avoided is a press law. Nowhere will it say what this body is, what it does, what it can't do, what the press can and can't do. That, quite rightly, is being kept out of parliament.
"So no statutory underpinning but a safeguard that says politicians can't in future fiddle with this arrangement," The Guardian quoted Cameron as stating.
Not surprisingly, Ed Miliband, the Labour leader, described the agreement a bit differently: "What we have agreed is essentially the royal charter that Nick Clegg and I published on Friday. It will be underpinned by statute. Why is that important? Because it stops ministers or the press meddling with it, watering it down in the future."
The call for new press regulations comes after the News of the World was shut down following revelations of widespread phone hacking by the Murdoch paper. This morning The Sun, another Murdoch paper, issued an apology to Siobhain McDonagh, a Labour MP, who had her mobile phone stolen by the paper and her private information accessed. The BBC is reporting that the MP will receive "very substantial damages" from the paper.
Apple has issued a new version of Xcode (version 4.6.1) for Apple licensed developers to download. The update was issued to support OS X Mountain Liion version 10.8.3.
The update fixes an issue where ARC-enabled apps do not launch on OS X 10.6 Snow Leopard, as well as other fixes. Often, however, much of what is new is left for developers to discover. Happy downloading.