Never underestimate the capacity of the Eurozone to shoot itself in both feet . `` Breath-taking , '' `` Staggering , '' `` Bewildering . '' Just some of the adjectives we could use to describe the latest Eurozone fiasco where the troika -- made up of the European Commission , the European Central Bank and the International Monetary Fund -- has managed to snatch defeat from the jaws of victory . The decision to `` bail-in '' depositors in Cyprus -- to make ordinary people pay for the mistakes of the banks -- is extraordinary . Nothing like this was done in Greece , Portugal or Ireland . Why , oh why , it should be up to the Cypriots to test drive this dangerous and maverick policy remains unknown . To be sure , the presence of large Russian and offshore funds in Cypriot banks is cause for a different format than those used in other peripheral countries . For example , you could not realistically have the money of German housewives bailing out Russian oligarchs . There were more sophisticated and rapier like ways to achieve the same goal , taxing deposits under €100,000 at over 6 % is effectively punishing the Cypriot people . Cypriots are already going to feel the ferocity from the effects of a recession caused by lower wages and high unemployment , they do not need the additional confiscatory measures of their deposits being taken . Once again the Eurozone has shown it is better at creating crises than confronting them . In the past few hours , I 've spoken to bank CEOs and top economists . Words like `` great mistake '' and `` disastrous '' are being used . So far I have not spoken to anyone who thinks this is a good idea . At all levels , for depositors , future foreign investors and Eurozone policy , the decision on tiny Cyprus is going to have huge ramifications .
The money of German housewives should not bail out German oligarchs , writes Eurozone . Quest : Taxing deposits under € 100,000 at over 6 % is effectively punishing the Cypriot people . Quest : The Quest has shown it is better at creating crises than confronting them .