90 seconds at 9 am: Only hard choices for Cyprus; key EU meeting imminent; IMF to downgrade US growth; Sth Korea - Japan spat; Pimco says longer deficit is ok; NZ$1 = US$0.836, TWI = 76.5

The Newport Beach, California-based company’s holdings of New Zealand and Australian bonds are about 4 percent to 5 percent over a neutral position, which Mather said is a “notable overweight” for the manager of $2 trillion in assets. Prime Minister John Key’s government has shown a commitment to returning to a budget surplus in 2015 after posting a record deficit in 2011.

“That’s why investors such as ourselves are increasing their exposures to government debt in the region,” Mather said. “What you want as an investor is a good credit growth profile and a government that has a sustainable balance. It doesn’t mean they have to be always in balance but they have a path toward balance and a commitment to it.”

Why would Pimco pump the price ahead of it's dealer's best efforts to gain cheap position, unless....? 

Good piece highlighting that Europe has a much bigger crisis than Cyprus on its hands - the Eurozone economy is sinking:

http://au.businessinsider.com/europes-economic-crisis-is-much-bigger-th…

Cyprus reached an outline deal with international lenders for a 10 billion euro bailout that would shut down its second largest bank and inflict heavy losses on uninsured depositors, Reuters says.

http://www.reuters.com/article/2013/03/25/us-cyprus-parliament-idUSBRE9…

CYPRUS

Emergency talks have wrapped up

EU says insured bank deposits safe.

Small (un-insured?) account-holders are covered by the EU's deposit guarantee legislation, which runs to the 100,000-euro threshold

Those above that level face a hefty haircut.

This would come at a massive price for investors

One senior EU source said the haircut could be as high as 40 per cent

The curious thing about this Cyprus calamity is this

Russian Oligarchs and (presumably) wealthy nationals from other countries have been pouring loot into Cypriot banks for a long time to take advantage of Cyprus Tax Haven Status. This was going on before Cyprus became a member of the EU. The EU mandarins knew all along.

The Cypriot Banks, flooded with hot money invested it south of the Border in Greek Banks

The Huge Greek Bail-Out happened 12 months ago.

Creditors of the Greek Banks agreed to a huge haircut.

Cypriot Banks were Creditors of the Greek Banks

That means the Cypriot Banks were the victims of that haircut

The interesting thing is

The Russians never knew where their money was going.

Thay have been kept in the dark

The time taken for the roll-through domino effect to emerge has been 12 months

Wonder if some of the Oligarchs were given a heads up to use the time to insure

Wonder who the insurers were.