Cyprus + EU + IMF = worldwide shock?

I predict, without any real powers of foresight or inside knowledge involved, that US stock markets will tumble huge on Monday, March 18, 2013  (hint: stocks are already down big (banking stocks down more than 2%) in pre-bell trading, so at the opening bell, the US markets will already be in negative territory).

With that crazy tax on Cypriot bank holdings, the EU and IMF have managed to shoot the Eurozone in the foot, with a bank run that started with Cyprus, but has hints of spreading to the PIIGS and beyond.

You can't tax people on their savings, without triggering a bank run.  Why, after all, keep money in the bank that'll get taxed, when you can put it in your mattress and not suffer the tax (and probably come out ahead)?  And as all bank runs do, they force a bank into insolvency as its ability to make loans (and therefore generate income) dries up.

It's not a done deal, though.  Cyprus still has to vote on it, and it is not looking good.  But the markets are cognizant that this mechanism may be required of the PIIGS, should they require additional help, and that fear has already pushed some people to pull their money out of banks in those areas.

I think we might be seeing something close to a test on a counterfactual over Hank Paulson's 2008 move to give money to banks to backstop them from failing.  (Counterfactual: With deference to moral hazard, TBTF should have been allowed to fail, allowing the market to dig itself out on its own, and faster.)

What do you think?

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Update: They've closed Cypriot banks until Thursday. I guess that's one way to prevent a bank run.

In rapid succession everyone denied responsibility for the tax idea, followed by the Cypriot government announcing that it would try to rework the deal and halve the below-€100,000 tax rate.  Don't hold your breath.

I would presume (not really, because it's obvious) that Germans don't feel especially gracious to encourage the ECB to turn on the printing press and simply deliver Cyprus a wad of Euros.  I guess seeing the collapse of the Eurozone, down to a handful of core nations is palatable.