Over the past week, NBC News offered timely coverage of the Cypriot bailout with extensive video and written content on the issue. I particularly enjoyed NBC's emphasis on how the bailout can impact U.S. markets.
For those who are unfamiliar with the topic, here's an simplified introduction to the crisis. Cyprus, a small island nation and member of the eurozone, is in a lot of trouble. Its banks have been closely tied to Greek debt, and with a small, struggling economy, it was forced to look for financial help abroad.
In June 25 of 2012, Cyprus requested help from the E.U. On March 16, 2013, the E.U. and the International Monetary Fund offered a €10 billion ($13 billion) bailout to Cyprus.
This offer, though, required Cyprus' parliament to take austerity measures, including a 7 percent tax on bank deposits under $100,000 and a 10 percent tax on deposits above $100,000. Parliament rejected these measures as part of the bailout deal on Tuesday while, according to an NBC report, thousands of Cypriots rushed to closed banks to withdraw their savings.
On Friday, NBC published another report about the parliament's attempt to pass alternative austerity measures before the deal's deadline on Monday. Parliament passed three measures to alleviate the situation: one to restructure lenders into "good" and "bad" banks, another to limit the amount of financial transactions in times of crisis and a final one to set up a "solidarity fund."
Cypriot banks will remain closed until next Tuesday while legislators come up with another way to fund the extra €5.8 billion in austerity the E.U. is demanding for the bailout. An NBC report published Saturday indicated Cypriot officials may want to fill this gap by taxing deposits over $100,000 at 25 percent in the Bank of Cyprus, the nation's largest bank.
If the parliament is unable to come up with a feasible deal by deadline, the country's banking system will almost certainly collapse and its economy will spiral out of control according to an NBC video posted Sunday.
So who cares? Why does Cyprus matter? It's a tiny country that makes up only one-fifth of a percent of the entire economy of the eurozone. What impact does a minor €10 billion bailout have on NBC's audience in the U.S.?
NBC provides a comprehensive answer to these questions through an article published by its consumer program, CNBC. This article provides balanced coverage for the developing debate about the implications of Cyprus. While some argue that the country won't have much of an impact on the global economy, others fear that if the E.U. and Parliament are unable to strike a deal, a long line of other eurozone nations will crash like dominoes along with the island nation.
While most people agree that such widespread collapse will not occur, an NBC Business column suggests that the inability to secure a bailout deal may force Cyprus exit the eurozone, a move that may have potential fallout in nations which previously received an E.U.-IMF bailout. Consequently, stock traders are watching the situation with severe caution, as the value of the euro may be at stake.
I am impressed with NBC's very in-depth coverage of this story; it has entertained my interest in monetary policy.
For those who are unfamiliar with the topic, here's an simplified introduction to the crisis. Cyprus, a small island nation and member of the eurozone, is in a lot of trouble. Its banks have been closely tied to Greek debt, and with a small, struggling economy, it was forced to look for financial help abroad.
In June 25 of 2012, Cyprus requested help from the E.U. On March 16, 2013, the E.U. and the International Monetary Fund offered a €10 billion ($13 billion) bailout to Cyprus.
This offer, though, required Cyprus' parliament to take austerity measures, including a 7 percent tax on bank deposits under $100,000 and a 10 percent tax on deposits above $100,000. Parliament rejected these measures as part of the bailout deal on Tuesday while, according to an NBC report, thousands of Cypriots rushed to closed banks to withdraw their savings.
On Friday, NBC published another report about the parliament's attempt to pass alternative austerity measures before the deal's deadline on Monday. Parliament passed three measures to alleviate the situation: one to restructure lenders into "good" and "bad" banks, another to limit the amount of financial transactions in times of crisis and a final one to set up a "solidarity fund."
Cypriot banks will remain closed until next Tuesday while legislators come up with another way to fund the extra €5.8 billion in austerity the E.U. is demanding for the bailout. An NBC report published Saturday indicated Cypriot officials may want to fill this gap by taxing deposits over $100,000 at 25 percent in the Bank of Cyprus, the nation's largest bank.
If the parliament is unable to come up with a feasible deal by deadline, the country's banking system will almost certainly collapse and its economy will spiral out of control according to an NBC video posted Sunday.
So who cares? Why does Cyprus matter? It's a tiny country that makes up only one-fifth of a percent of the entire economy of the eurozone. What impact does a minor €10 billion bailout have on NBC's audience in the U.S.?
NBC provides a comprehensive answer to these questions through an article published by its consumer program, CNBC. This article provides balanced coverage for the developing debate about the implications of Cyprus. While some argue that the country won't have much of an impact on the global economy, others fear that if the E.U. and Parliament are unable to strike a deal, a long line of other eurozone nations will crash like dominoes along with the island nation.
While most people agree that such widespread collapse will not occur, an NBC Business column suggests that the inability to secure a bailout deal may force Cyprus exit the eurozone, a move that may have potential fallout in nations which previously received an E.U.-IMF bailout. Consequently, stock traders are watching the situation with severe caution, as the value of the euro may be at stake.
I am impressed with NBC's very in-depth coverage of this story; it has entertained my interest in monetary policy.