Robert Boyes, Times correspondent and author of the new book Meltdown Iceland, says that everyone except Icelanders knew the Icelandic economic collapse was approaching as early as 2006.
In an extended interview on RUV’s Silfur Egils political talk show, Boyes said Iceland had been poorly governed by the Independence Party and that they had betrayed the nation.
Boyes said David Oddsson’s Independence Party had tried to implement a Margaret Thatcher-style economic revolution without putting the necessary strong state infrastructure in place to regulate it. Iceland is, he said, a great nation, but a weak state.
Boyes also criticised the fact that Icelanders allowed Geir Haarde to act as crisis manager for three months despite being ineffective and “David Oddsson’s lapdog”, although he later rephrased it to “very loyal”.
The politically-active Silfur Egils television presenter, Egill Hegason described Boyes’s book as the best yet written on the Icelandic economic crash.
Boyes said in the second half of the interview that he is largely happy with Iceland’s progress since the crash and was impressed with what he saw while living in Reykjavik to research his book. He still believes that Iceland can be the first of the seriously affected countries to come out of the current global crisis – pointing to the recent National Meeting and young people’s innovative new businesses as areas of success.
The interview can be viewed here for a limited time and begins 30:50 into the video.
Finally someone talking strait up…
Wow, he rambles on at the start! Actual meat of the interview starts 33:40. Well worth a listen but it is long (40 mins & counting).
If everyone saw the Icelandic crash coming, then why did they continue to desposit funds in Icelandic banks? All those individuals, local councils, charities, etc.
Jimbo (original Jim) said:
“If everyone saw the Icelandic crash coming, then why did they…..”
Hindsight perhaps?
I haven’t heard this interview yet, whatever player is being used it doesn’t respond too well to attempts to force it on even if the buffering is good.
Looks like I’ll have to suffer though the long preamble.
It’s always a good beginning for an English journalist to spend the first 10 minutes telling how much he admired iceland’s actions in the cod war.
I can’t say that he adds anything new to what we already know but it sounds like he has a good overall view, can express himself concisely and make his book an interesting read.
He is vague with supporting why he thinks Iceland can recover relatively fast with the Icesave debt anchor dragging its heels but anyway I think that is outside his remit.
Boyes in an interesting character although I think he has spent too long in Germany.
I do find it interesting his comment about centralizing power and recommendation to join EU. This does look to be because of how long he has spent in the German systems.
His writing in his articles and books is much tighter than this interview.
( He made interesting points that Thatcher government in UK did centralize power — and of course this one of matters that many dislike about the legacy of her changes — that she did put in place many tools that can be used by the later governemnts ( as New Labour has done) as tools for tyrannical purposes . )
I think I will read his book.
>pointing to the recent National Meeting
Refering to that glorified focus group+ that was Anthill as some thing more than it was — just a focus group — does reduce his credibility though.
+http://www.icenews.is/index.php/2009/11/14/iceland-holds-national-meeting/#comment-101497
Jim
Because we were dim greedy high risk gamblers according to some posters : {
Danske Bank warned us in 06 that the economy was heading for a hard landing, people decided to trust our politicians who said this was nonsense,
in 07-08 the icelandic banks had AAA credit rating and were getting loans to refinance debt, so if every one knew the banks were failing, why did they have this rating and access to loans ?
new documents from Wikileaks
http://www.wikileaks.com/wiki/Icesave_debt_negotiation_email_between_Indri%C3%B0i_H._%C3%9Eorl%C3%A1ksson_and_the_IMF%27s_Mark_Flanagan%2C_13_Apr_2009
http://www.wikileaks.com/wiki/File_on_Icelandic_bank_Landsbanki_Russian_associations%2C_1996-2009
Hi,
I have a tourist book written in 2006, where it’s written that Iceland financial situation is very problematic and could lead to a major crisis.
There was a crisis in March/April 2006. Eastern speculators had previously borrowed at low rates in Japan and invested in Iceland’s high rates. Then Japan raised their interest rates which stimulated a reverse flow of money away from Iceland. The Iceland CB panicked and raised interest rates to 10%, causing more panic.
At that time many foreign economists predicted that the bubble had burst for Iceland.
Would have been a lot easier to admit that the bubble had burst then and deal with it. Whatever forces at that time in Iceland sought to hide these facts and still campaigned to pour more gasoline on the fire are the most culpable for the crash.
>Would have been a lot easier to admit that the bubble had burst then and deal with it.
>
>Whatever forces at that time in Iceland sought to hide these facts and still
>campaigned to pour more gasoline on the fire are the most culpable for the crash.
http://www.iceland.org/media/DKvidskipti/Landsbankinn-22032006.pdf
is an example of oresentation of facts at that time.
Danske Bank’s report did not actually come true as it was closure of credit lines after Lehmans fell that caused things to come to an end as they did in 2008.
But there was awareness that things needed to change — and far as we can tell they did for example in Kauthping pulling out of NIBC bank in Holland aquisition.
There is lively discussion ( even with some facts ) about this whole subject in this thread here :
http://www.icenews.is/index.php/2009/09/28/british-and-dutch-stance-on-icesave-hardening/#comment-95623
If Lehmans brothers had not fallen Icelandic banks would not have had all of they credit lines closed up.
No one does dispute that they were operating on this whole sale funding abroad. And that after reatings agencies did reocmmend it that there was switch by Landsbanki and then Kaupthing to take the retail deposits.
But do not forget for example in case of Kaupthing SInger Frieldnader that the ” bank run ” there talked about a lot by Brumley here for example was not happening in same way as for IceSave because simply they did have longer term deposits.
Landsbanki did make that instant access accounts as most of theirs and that is why the bank run of IceSave when it came did cause all the troubles it did.
#Jimbo
I didn’t! Transferred all my money to euros and dollars.
I know someone who transferred his deposits from Kaupthing Edge literally 3 days before the crash. He worked for an investment bank in London and followed the CDS rates, but didn’t believe Icelandi would have a systemic crash until only a few days beforehand. He wasn’t a macroeconomist…
>But do not forget for example in case of Kaupthing SInger Frieldnader that the ” bank run ” there talked about a lot by Brumley here for example was not happening in same way as for IceSave because simply they did have longer term deposits.
I have difficulty in seeing what other decision the Treasury could reasonably have taken in the circumstances.
Didn’t I said all of that months ago? Nonsense still? Icelanders where too blind to see what was happening. A shopping trip to the mall of America this Xmas anyone? I guess not