The Cyprus banking system bailout bill has already gone up from EUR10 billion to EUR23 billion. This bill is set to grow further in the future. Steve H. Hanke, Professor of Applied Economics at The John Hopkins University, writes the following about what’s going on in Cyprus:

In consequence [to a money supply contraction of 13.5%], according to my estimate, Cyprus can expect GDP to contract by 12.2% in 2013. This will cause the so-called “good bank” – the Bank of Cyprus – which was set up as a part of the bail-in package, to probably go bust before long, wreaking even more havoc on the Cypriot financial sector, and the Cypriot economy.

I hope Cypriot bank depositors are taking the opportunity of the current dip in the gold price to get out of dodge by converting their Euro’s into gold and keeping it outside the banking system. Full article here.