European markets are down as they open for the first time since news of Cypriot bank depositor hits this weekend. Unsurprisingly Spanish and Italian indices have taken the biggest hits:
Allister Heath writes that the Cyprus deal will damage trust:
Above all, don’t lie, especially when it comes to people’s savings. That was a rule European politicians used to understand, especially in a continent where dispossessed middle classes have repeatedly turned to fascists when their savings were wiped out. Today, however, the political class and its corporatist allies have forgotten this golden rule – just as they no longer remember that democracy cannot be replaced by technocrats. Eventually, there will be consequences; they won’t be pretty.