Yes Krugman gets the summary right (here) but what he is missing is something I do not understand. In 2012 the German secret service “discovered” that there is Russian “oligarchic” money on the island of questionable origin. Moreover Cyprus had to clean its act so as to join the EU in 2004 and by the time they adopted the Euro in 2008 there should have been nobody in the euro zone who did not agree that having Cyprus join is desirable. Are we to believe that Germany had gotten the story so wrong in 2008 or is there a story to tie these loose ends? Isn’t it fair to say that the German secret service failed utterly if it took them 4 years to figure out Cyprus is not a cherry?
What is going to go down on the island tonight is very interesting and I am afraid that it will show that Cyprus is more systemic than some claim. I am afraid it may show how systemic incompetent politicians really are….