The more I think about the situation in Cyprus, the more I think of it as an ideal test bed. A 40% confiscation. Why so much?
It's a tax haven.
In other words, it's a world-wide perp walk that is meant to set an example for other tax havens, and potential users of said tax havens, that there is no place to hide.
Instead, they ensnared the innocent in the by-catch.
With banks due to reopen on Thursday, Finance Minister Michael Sarris said he expected the control measures to be ready by noon (5 a.m. EST) on Wednesday: "I think they will be within the realms of reason," he said, without going into details.
"Banks will open on Thursday ... We will look at the best way to limit the possibility of large sums of money leaving, and not imposing punitive conditions on the economy, businesses and individuals," Sarris said in a Cyprus television interview.
Within the realms of reason would have meant banks acting as prudent fiduciaries and not gorging on large amounts of Greek debt with Other People's Money. Confiscation, theft, haircuts, capital controls, whatever they are called, are punitive conditions.
Governments are not there to help you. Did a government just save an injured man from death in -25°C temperatures 13,340 feet up in a region known as the Rooftop Of The World, a 12-day trek from the nearest medical center? No. Dubai-based medical company RMSI did.
Moving to the S&P, yesterday seemed like a slam dunk for the EOQ markup scenario. This morning not so much. Futures got hammered overnight, and are pointing to a cash market that could test perhaps the 1550 area. Lower is possible, too, maybe even 1540. All I know is that I want to be a buyer of sharp declines until a new high.