Operation Cypriot Slip, Part 3

Cyprus, facing Monday's ECB deadline to pull the plug on their banking system, and a re-opening of banks that have seen their depositor's confidence shattered, is in a huge bind.  They called the ECB's bluff by voting down the first bank levy plan to tax all depositors.  The ECB responded with the Monday deadline which will lead to the country's economic collapse unless averted.  Cypriot leaders see they now have no choice other than to cough up cash by dropping a huge bank levy on only the island's biggest accounts, most of which are held by Russian oligarchs.

Cyprus is considering a levy of about 25 percent on bank deposits over 100,000 euros ($130,000) in the island's largest local lender, Bank of Cyprus, Finance Minister Michael Sarris said on Saturday.

Sarris told reporters that "significant progress" had been made in talks with officials from the European Union, European Central Bank and International Monetary Fund - the so-called 'troika' - and that the discussions may conclude on Saturday evening.

If that's true, the Russians are going to blow a gasket.  It also means that oligarchs in other EU countries are going to look at this in horror.  They know they're next.

Stay tuned.