Exactly. Whatever happens now, even if the authorities recede from this threat, people will now know that they can't trust banks/government with their money.

Just last week I was telling my mother and my step-father (who has a substantial investment portfolio and savings) that their money was not safe because, as the public finances ran dry, the government would start grabbing money from people's accounts and pensions etc. They didn't believe me, said I was being 'alarmist and silly'.

Cyprus really is the canary in the mineshaft. After all, now the authorities have done this and a precedent is set, surely they will try the same tactic with all future financial interventions. Spain, Italy, Portugal, Greece, Ireland......

Interesting fact about Cyprus that may have a relevance here: Cyprus is, per square mile, the most heavily militarised nation on the planet. Due to the long-running division of the island the republic of Cyprus maintains a very strong national guard defence force. Most able bodied males have military training, know how to use an assault rifle, and know where they are kept.

If the banks and government think the Cypriots will just say 'OK' to this then they have another thing coming. I predict that it won't just be civilians lining up outside the banks, but rather uniformed and armed Cypriot National Guard troops staging a coup.

The first duty of any military is to protect the people. This is the time for the Cypriot (and Greek, and Spanish) armed forces to stand up and show the banksters and political elite who is really in charge. Get the nooses ready.