Comments on: Iceland: Agreed Guidelines Reached on Deposit Guarantees

By: Gray, Germany

Gray, Germany — Tue, 18 Nov 2008 11:22:15 +0000

“Actually, he is an economist. :-)”

Ok, I guess they come in all kinds…
But I’m more accustomed to the clear, understandable language of economists like the late John Kenneth Galbraith, and the very much alive Paul Krugman and Brad DeLong.

By: Bjarni

Bjarni — Mon, 17 Nov 2008 10:51:45 +0000

To Gray, Germany:

>>>>And good find, Physhim, that Haarde quote. But, for heaven’s sake, why can’t the guy simply say “we will pay the guarantees”? Instead, “will undertake the obligation to pay what Landsbanki assets will not cover”, now, really! What is he, a lawyer???

Actually, he is an economist. :-)

http://en.wikipedia.org/wiki/Geir_Haarde

The agreement is probably (not been published yet), that the UK and Dutch governments will loan Iceland the money to pay the depositors. Then over the next few years the assets (loans) will be collected and/or sold. If at the end of the term, the total assets will not be enough, then Iceland will cover the difference (how I don’t think anyone has figured out yet). So that is probably what Geir Haarde meant with his legalspeak.

By: Kam

Kam — Mon, 17 Nov 2008 10:34:05 +0000

As far as i understand the people who had money in Non EEA locations are still being shafted by Iceland. So absolutely nothing to rejoice about for them.

Absolutely agree with others on this thread, and it’s something that i and quite a few others have been saying since day one; Haarde and his gang are a complete waste of space and resources and should be dropped with lead weights into the deepest ocean trench.

By: Peter - London

Peter - London — Mon, 17 Nov 2008 10:19:26 +0000

“Announcing the agreement, Geir Haarde, Iceland’s Prime Minister, said: “It became increasingly clear that we were not just up against two countries but all twenty-seven in the European Union.”

If found this on The Times website. It demonstrates amply what a political (as well as economic) fool this man is. Of course the EU is going to stand together when its economic interests are threatened.

In particular, Germany, Holland and the UK are the biggest contributors to the EU’s budget and Icelands attack against them threatens the finances of all the EU nations.

By: Gray, Germany

Gray, Germany — Mon, 17 Nov 2008 00:02:46 +0000

“The news here in Iceland this evening was though, that this would mean that all the IceSave accounts would indeed be guaranteed up to 20K Euros by the Icelandic government.”

Sounds good, Bjarni. I guess even Haarde won’t risk the embarassment of more arguing about loopholes when the Icelandic public understood him as promising to pay the guarantees.

And good find, Physhim, that Haarde quote. But, for heaven’s sake, why can’t the guy simply say “we will pay the guarantees”? Instead, “will undertake the obligation to pay what Landsbanki assets will not cover”, now, really! What is he, a lawyer???

By: Bjarni

Bjarni — Sun, 16 Nov 2008 23:12:11 +0000

I kind of agree, there is nothing really new in this press release. Everybody just agrees that the 94/19/EC Directive applies, which really never was in question. It was the interpretation of it that was always the question. Maybe the wording “in the same way” means something significant.

The news here in Iceland this evening was though, that this would mean that all the IceSave accounts would indeed be guaranteed up to 20K Euros by the Icelandic government.

I think its likely that everybody has reached some kind of political agreement, that they simply do not want to put exactly down on paper, at least not yet.

Things could get interesting though, when the Icelandic government will try to pass new laws in the parliament, that would be necessary in order for Iceland to accept any new obligations. It is quite likely many of the MP´s both in the parties that support the government and of course also those that are against it will demand to know more before accepting anything.

By: Physchim62

Physchim62 — Sun, 16 Nov 2008 23:00:49 +0000

“We accept the EU directive on deposit guarantees and will undertake the obligation to pay what Landsbanki assets will not cover” is the quote from the Ostrich Haarde. Of course, everyone else thought they accepted it in 1999 (Law 98/1999 of the Althing), when the Finance Minister was a certain Geir H. Haarde…

By: orchafine

orchafine — Sun, 16 Nov 2008 22:24:32 +0000

There’s no point to fight with Haarde any more. He is done!
At least this situation showed to the world how dumb he is… Hope the EU keeps him and his friends under control though.

By: theblob

theblob — Sun, 16 Nov 2008 22:03:13 +0000

I wonder we the central bank of Denmark and Sweden got cold feet? The politicians of both countries said they would offer assistance but any decisions would be taken on the level of “public servants”
First they somehow tied the loans to the IMF package, when that failed the 2 central banks seem rather pleased somehow.
Could it be that the central banks of Denmark and Sweden would entrust Sedlabanki with a free kebab? Simply because they doubt Sedlanbanki have the competence needed to run a central bank? Any offers?

By: Gray, Germany

Gray, Germany — Sun, 16 Nov 2008 21:01:16 +0000

“All parties concluded that the Deposit Guarantee Directive has been incorporated in the EEA legislation in accordance with the EEA Agreement, and is therefore applicable in Iceland in the same way as it is applicable in the EU Member States.”

Not to be too nitpicking, but this shouldn’t have been a controversial point. what’s controversial is if the EEA statutes obligate Iceland to finance the guarantee fund, since Haarde and his gang claim there is a loophole in it that allows them to disregard this. I see nothing in this declaration about this particular arguement, nothing about financing the guarantee fund at all, and no plan about credits to be used to pay the guarantee sum to depositors.

Hmm, maybe I’m too suspicious, but I’m really underwhelmed right now. Is this just another smoke screen, like that infamous letter ot the UK treasury, which actually promised nothing???