It is a public holiday in Australia today like everywhere. So this is a relatively short blog. In the last week, the tiny nation of Cyprus has committed itself to a path that will see it stagnate for years to come and real living standards will fall. It will lose its banking sector and will find it hard to stimulate its tourism sector given it is unable to alter its exchange rate. Domestic wages and costs will have to fall dramatically before there will be any significant stimulus to tourism. The government is unable to support domestic demand growth because the Troika will not let them increase their discretionary budget deficits. And sooner or later some German or another will start demanding they sell their island to pay their bills (remember Greece). In other words, they are following the Greek path to destructive oblivion. Apparently this is because there is no better alternative. The Euro elites have spent a lot of effort telling everyone that there is no alternative to harsh austerity and the destruction of another economy. But for anyone who keeps their eyes on the data you will know that there is an alternative. A small island state – Iceland – issues its own currency and allowed their exchange rate to move with relative currency demand has emerged damaged but not in Depression. The vital signs in Iceland are positive.