Not too long ago, I wrote dollar backwardation. It’s happening, not in the dollar, but in the euro in Cyprus. Zero Hedge writes the following.
Banks have been closed all week, the threat of loss of part of one’s deposits is still there, it is at best uncertain when banks will reopen, and capital controls are effectively in place, with the only way to get money out a bank via a limited ability to a cash machine.
From the article: “Some businesses are now refusing credit card payments, our correspondent reports.”
Electronic credits are being refused but paper cash is welcome. This is euro backwardation writ large in Cyprus.