The euro initially spiked higher Sunday night on word that the Cyprus episode had been put to rest. Bondholders and depositors of more than €100,000 will be wiped out as a result of the deal, but hey, at least Europe will live to fight another day.  We’re joking, of course, since the EU’s bank establishment has effectively served notice on every depositor from Lisbon to Trieste that whatever they’ve got socked away in banks could vanish overnight without warning. Do the morons who are bidding for euros tonight actually believe that a crisis that will have scared the living crap out of every depositor in Europe — are you paying attention, all you pathetic, wretched savers in Spain, Italy and France? — is going to somehow blow over without further repercussions?

As for the Russian tycoons who will lose everything they looted from the old USSR, it’s hard to imagine how they could retaliate.  We have just one word of advice for those among them who have not gotten wiped out: GOLD.  Meanwhile, to others ‘fortunate’ enough to have held no more than the insured limit of  €100,000 in the Bank of Cyprus when the music stopped, we wish you good luck trying to get your money out, since withdrawals are being restricted to €100 per day.  This may be just the thing to calm “the markets” and the imbeciles and psychotics who trade them for a few days, but make no mistake, the way this affair has been handled — a bail-in rather than a bailout —  has set the scene for a panic that will make the Great Financial Collapse of 2008-2009 seem like the warm-up that it was.