These demands amounted to a virtual run on the banks and helped to bring down Bear Stearns and Lehman Brothers.
Transactions: There would be controls on bank transactions to stop a run on the banks with money being taken out of Cyprus.
Both the government of President Eduardo Duhalde and the IMF want to prevent a run on the banks.
There are other facts, but suffice it to say that the run on the banks and eroding confidence led to a reduction in market liquidity, and the stock market was en route to a decent of nearly 50%.
Strict capital controls - unprecedented for the eurozone - are in force in Cyprus, limiting cash withdrawals to prevent a run on the banks.
It is true that Mr Obama's solution to the recession spending public money in order to stimulate demand and trying to prevent a run on the banks is supported by most economists.
The next day, to halt a run on the country's banks, the central bank imposed restrictions on withdrawals.
It seems banks are much weaker today thanks to bailouts of the financial and accounting variety that delay their necessary acquisition by better managers, not to mention the capital destroyed over the years due to poorly run banks being given new leases on life.
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And the scariest thing, I think, I've seen yet, was what happened to IndyMac in the summer, in July, when you had a run on the banks.
But the government, fearing a run on the banks, believes that it is the only way to maintain stability and proceed with an orderly liquidation of insolvent banks.
The scheme relies on donations from individuals and private companies as well as volunteers to run the banks themselves.
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But the Cypriot parliament rejected the bailout offer due to public outrage over the levy, prompting fears of a run on the country's banks, which have been closed since March 16, and officials went back to the drawing board.
Some observers had predicted that efforts to renegotiate the bailout could lead to a run on Greek banks and deeper misery.
There is very little chance that politicians would ever choose to use the model they developed in Cyprus in a country like Italy or Spain, where a run on the banks would have such profound implications.
Markets will be keen to discover who will run the agency, as well as the total size of bad debts it will go on to buy from the banks, and what valuation it puts on those debts.
They are struggling to put in place capital controls to prevent a bank run when the banks reopen, possibly on Thursday.
As leaders prepared to tax bank deposits in order to prevent a default, citizens panicked and caused a run on the banks.
Many fear a run on the banks, causing the country to be forced out of the euro - heralding in turn the return of the drachma.
Some economists even fear a run on Vietnamese banks in the absence of robust measures to shore up the country's financial sector.
That reality last week triggered a run by dollar depositors on European banks with exposure to government debt prompting the U.S. Federal Reserve to make emergency loans to the European Central bank so it, in turn, could provide dollar liquidity to its member banks.
Critics had feared that efforts to renegotiate the bailout would set up a confrontation that could lead to a run on Greek banks and deeper misery.
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After being closed for nearly two weeks, there was some fear that the reopening of Cyprus banks on Thursday could lead to a widespread run on deposits.
Rather than tackle such serious questions as how to keep Greece in the euro, prickly political leaders shrugged off warnings that a run on Greek banks was imminent and swapped insults instead.
Ed Miliband replies that a judicial inquiry could deliver that and go on to deliver something else - produce a sort of public reckoning with those who run the banks.
European finance ministers were divided over how to treat the deposits of banks that run into trouble, as they struggled to find accord on new rules to deal with failing banks.
If Greece stormed out, and damn the law, as it might yet have to do, it would suffer a run on its banks, as depositors withdrew euros before they were forcibly converted into devalued new drachma.
Mr Buiter acknowledges that Britain has access to currency swap lines from the world's biggest central banks, which would help it prevent a run on the banks.
But those who run our biggest banks tell me that the FLS will never on its own either lead banks to increase their net lending to the real economy or in a significant way contribute to economic recovery.
During the height of the crisis, it may have accelerated the spread of toxic asset pricing, leading to a faster run on Bear Stearns and Lehman (and other banks too).
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Meanwhile, the country's banks have been ordered to remain shut until Thursday, amid concerns of a run on bank accounts.
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