It has been amusing listening to the hypocrisy from Brussels regarding the leverage in Cyprus.

Jeroen Dijsselbloem, president of the eurogroup led the charge that Cyprus had an unsustainable problem with deposits over 700% of GDP.

Here is a little perspective courtesy of the Financial Times.

Somehow we are supposed to believe that 7-1 ratio of deposits to GDP is a problem but the 22-1 ratio in Luxembourg is not. And what about the 4-1 ratios in France and the Netherlands?

What sunk Cyprus now rather than later was Cyprus was dumb enough to be in Greek bonds.

So why did Cyprus stay in Greek bonds so long? The answer is Cypiot banks were foolish enough to believe ECB president Jean Claude Trichet when he insisted there would be no haircuts on Greek bonds.

…..read more about the Timing the Axe on Spain and Italy HERE