Cyprus is on the verge of default earning a CCC+ credit rating. Everyone of its economic and fiscal indicators is cratering, the result of a banking crisis. Cyprus has a choice. It can either choose the Irish or Icelandic model for dealing with the crisis. Unfortunately, it is a foregone conclusion that it will saddle Cypriot taxpayers with the bad decisions made by investors and depositors in the banking system condemning the country to a Greek style depression for years.
The winning candidate has close ties to Merkel, and she supported him during the election. All the Germans want is to keep the euro together so they can continue exporting with a weak currency. They care as much for the Cypriots as they do for the Greeks. Cyprus will receive just enough aid so that it does not default while the austerity shoved down their throats saps growth for years.
These bailouts are never about assisting the countries that request them. Their purpose is to bailout the banksters and to maintain the euro for the benefit of Germans. Some day, the people of the Mediterranean countries will understand this and rise up, but, alas, today is not that day.