So what's the big deal? was the message on CNBC, FOX etc, as talking heads crowded the air to explain that Cyprus is a tiny island nobody cares about anyway in the middle of nowhere, where lots of folk don't even speak English, and the bank depositors being robbed were all probably just Russian Mobsters who are laundering money anyway.  

 

But what if folk in Spain, Italy, France, Portugal, Greece - whose banks are in similar straights - get the idea that they might be next?  What would you think if you were a depositor in those countries?  What would you do?

 

Thanks god it can't happen here in the good old US of A - right?  Right?

Saving Cyprus Means Nobody Safe as Europe Breaks More Taboos

By Simon Kennedy - Mar 25, 2013 8:01 PM ET

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Customers line up to withdraw cash from an automated teller machine (ATM) operated by OAO Sberbank in Moscow, Russia, on March 22, 2013. Russian lenders with Cypriot units include OAO Sberbank and OAO Gazprombank, both state-controlled, Otkritie Capital, part-owned by VTB, as well as Aton Capital, UralSib Financial Corp. OAO Promsvyazbank and BCS Financial Group. Photographer: Alexander Zemlianichenko Jr/Bloomberg

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The island nation’s rescue sets precedents for the euro zone that may stick in the memory of depositors and bondholders alike as investors debate who will next fall victim to the debt crisis. Under the terms of the agreement struck yesterday in Brussels, senior Cypriot bank bond holders will take losses 

and uninsured depositors will be largely wiped out.

The message that stakeholders of all stripes can be coerced into helping a cash-strapped nation may make investors more skittish they’ll be targeted if Slovenia, Italy, Spain or even Greece again is next in line to need help. The risk is that bank runs and bond market selloffs become more likely the moment a country applies for a new rescue, said economists and academics from Nicosia to New York.