A spokesman for the Dutch Ministry of Finances said earlier today that Dutch authorities will grant Iceland up to 1.3bn euro, MBL reported. The condition for the loan is that the money is used for paying IceSave depositors.
According to Dow Jones, the loan is a part of the 5bn euro loan package that British, Dutch and German authorities will grant Iceland. The majority of foreign depositors in Icelandic savings accounts come from these three countries.
The loan was contingent on the approval by the IMF of a 2.1bn US dollar loan last night (about 295bn Icelandic krona). The Danish, Finnish, Norwegian, Russian and Polish governments will loan Iceland another 3bn US dollars.
In the agreement that was announced last week it is stated that the Icelandic government guarantees the minimum insurance amount which EEA regulations stipulate for depositors in foreign branches of international European banks. The EU continues to search for a solution that would help Iceland restore the financial system and economy.
Arni Mathiesen, the Icelandic Minister of Finances and Dutch authorities had already come to an agreement for a loan of 1.1bn euro. This sum has now risen to 1.3bn euro (about 230bn Icelandic krona).
This amount has risen because Iceland needs to pay IceSave depositors up to the first 20,887 euro in every depositor account.
German, British and Dutch governments promised their help to Iceland under the condition that the IMF approved the loan of 2.1bn US dollars, the three nations informed in their joint statement. The IMF loan was approved last night.
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If anyone thinks that I meant to say $700bn for the US instead of $7 trillion, take a look here:
Gus & others
First, to be fair, let’s look at the figures from other countries:
The British Government has used GBP 600bn to bail out the banks so far, France: EUR 360bn, Germany: EUR 500bn and in the US, taxpayer support is around $7 trillion. Latvia has just received Eur 7.5bn from the IMF.
UBS and Credit Suisse have a balance sheet of $3 trillion which is about ten times Switzerland’s GDP of $300 billion so Credit Suisse was levered by more than 40 times; UBS was levered by more than 64 times. A 16% fall in UBS’s assets would wipe out not only all of its equity but 100% of Swiss GDP on top.
According to Bloomberg, the total is about $10 trillion and it’s probably going to increase.
ICELAND’s bankers and population all played along with the easy and cheap global credit situation, at the time, in keeping with prevailing practices of all of the countries above. There is nothing very different in what Iceland did, to what happened elsewhere.
The problem was that Iceland believed that it was “in with the big boys” and, right to the last moment, stubbornly failed to see that the party was coming to an end. Instead of deleveraging, they racked up the leverage. Instead of realising that the housing bubble must burst in Iceland, just as it was bursting elsewhere, they kept building more new property developments. To put it simply, their equity was just not strong enough and their loan books were too weak. Bjarni mentions the figure of “only” Eur 20bn in Iceland. It doesn’t take a genius to see that a small drop in the loan book could easily wipe out a bank whose equity is 1/10th.
But the bubble is popping folks. Everywhere, not just in Iceland. And the Chinese do not want to lend more. Zhou Xiaochuan, governor of the Chinese
central bank said to Hank Paulson just recently:
“over-consumption and a high reliance on credit is the cause of the US financial crisis” and “as the largest and most important economy in the world, the US should take the initiative to adjust its policies, raise its savings ratio appropriately and reduce its trade and fiscal deficits.”
USD 3,55% 125,63 126,27
GBP 3,58% 185,96 186,91
DKK 3,52% 23,548 23,690
NOK 3,08% 17,814 17,921
SEK 2,08% 15,988 16,084
CHF 4,86% 115,84 116,53
JPY 3,29% 1,3915 1,4002
EUR 3,51% 175,51 176,57
GVT 3,45% 224,27 225,69
HMMMM, IT SEEMS THAT ICELANDERS ARE JUST ABOUT OF ASKING FOR MORE MONEY…. WHO IS GOING TO LEND THIS TIME?? CHINA??
Great article. I found some more information here
Link social values with economical performance is something economists do on a daily basis. Of course we cannot “judge” every individual of a society as if they were just one body. But, in everything related to national economical performance each country comes out as a single unity.
If you would ever lived in Germany for enough time you would see how Germans in general are very cautious with what they do with their moneys. People use to save a lot and they live very much to the real levels they can afford. Why? After the II World War it was not easy to live in Germany and people learnt to live with shortages of food and anything else for many years. Therefore people learnt to be cautious with money, work hard and not to get into debt if it was not really necessary. Those values are still very much the values of the German society in general. They are to be observed in the way people live and/or the banks and the Estate act. I would say that even if Germany has been a country where you could live cheaper and relatively less than in Iceland during the last years, german society seem to live more on a realistic way in accordance with peoples possibilities. Swiss population is very similar to the german in the way that we are known for being cautious and preferably conservative ( in the way of low risk) oriented. Economical growth, both in Germany and Switzerland has been build on a strong basis during long term economical and social approaches.
Icelandic society has presented itself to the world, specially during the last years, as the triumph of the economical growth. But, what was the ground, the basement of that growth? Was is stabile enough? Was it build on a strong ground? What was the level of risk this society took? How did icelandic population get cautious and ready for any bad times to come?
Now this country will face disparity, loss and ruin. People will learn to live under other values. Society will be different so will hopefully the economy in the future. Last minute fixing solutions and measures are not going to work to put things as they were in a short time (1 or 2 years) We all know that it will take much longer.
The Icelandic crisis is something that needed to happen. It just got to happen in the worst time for doing so, which is at the beginning of a world wide economic “recession” ?
And there we have it, you are probably a good person, and a nice credit to your country.
I will however not judge the rest of your countrymen on your merits.
“Merkel and the German Gov have persisted with blaming the US, long after German Banking shortcomings were blatantly obvious.”
Well, of course German bankers were as foolish as the rest of the world, but it’s still a fact that the idiotic deregulation in the US pathed the way for the crazy financial “products” whose risks became undterminable even for experts. Just remember, it wasn’t a German agency who rated those crappy papers AAA! Not to defend the lamers in our banks, but the ratings by Moody, S&P et al used to be accurate. Just five years ago, nobody would have believed those agency could be so utterly, sytematically, constantly wrong.
Gray, Germany said:
“Knowless, Merkel was speaking about the US being the reason for the general banking crisis in Europe, not about the Iceland speicific bank collapse, which comes form a different cause.”
Of course Merkel is not referring to Iceland in particular, however it is in Europe and operating heavily in Europe.
She said the US was to blame 100% of Europe’s economic woes. The German banks were blameless in her opinion.
Who else can be responsible for the banking blunders of Leipzig bank, the state bank KfW and the HRE Mortgage €50bn bailout but Germany?
Merkel and the German Gov have persisted with blaming the US, long after German Banking shortcomings were blatantly obvious.
The obvious point I made was that Governments play the blame game as part of their first nature and some people buy into it.
“But someone should tell the German leaders”
Knowless, Merkel was speaking about the US being the reason for the general banking crisis in Europe, not about the Iceland speicific bank collapse, which comes form a different cause.
And it isn’t really surprising she doesn’t mention Iceland in that speech, since it was held on September 25th, even before Glitnir crashed.
However, there is a suspicous silence in Berlin about the Iceland crisis. If you find a statement by Merkel covering the issue, pls let me know. I haven’t found one so far.
Btw, this story I found on the intertubes shows how the risks for Iceland were evaluated half a year ago:
“The suspicion is that speculators exerted undue pressure on the illiquid CDS market in the knowledge that the wider the spread went, the more fear of a banking collapse would contaminate the stock and currency markets. There are also concerns about the way rumours were spread about the alleged reliance of Iceland’s banks on internet deposits, which triggered reports in UK newspapers that such deposits could be withdrawn rapidly [sic!].”
“However, banking sector assets have grown from about 96 per cent of GDP in 2000 to about 10 times today – the main source of concern about the country.”
“But growth has not been without its costs. Iceland reported a current account deficit of 16 per cent of GDP in 2007, while inflation stood at 8.7 per cent in March – well over its central bank’s target of 2.5 per cent.”
“As for the banks, they have responded to criticism by diversifying funding away from wholesale markets and relying more on deposits [sic!].”
Pls note that Haarde stated he is “prepared to intervene in the markets”, and that several proposals on strengthening Iceland’s position are mentioned, including joining the Euro. What happened in the six months until the shit finally hit the fan, did he fall asleep at the wheel? It’s scandalous.
The very small tiny island I´m from is in a Swiss lake. I recommend you to visit the islands in the swiss lakes. They are authentic paradises. In summer you can bath at white sand beaches and you would just think you are on the caribbean… Oh, if any icelander needs a jot there is plenty in my country. ( My mother needs a cleaning woman). It would be nice to have an icelandic house maid back at home so I could keep practicing my icelandic. It would be nice if she is like good looking between 20 and 25 years, good tits and a nice ass, preferably with a red hair, thank you.
I don’t know if my head is full of shit. But if it is like that it has to be GOOD SHIT. Because I have been very very cautious and lived in a realistic way. Working hard and intelligently positioning my moneys. Now my bank accounts are full of money, here and abroad. Mostly all in euros, dollars and swiss francs. I have 0 debts!! I own everything I have because I have already paid for it. The bank is paying me interest for my moneys and that is just making my life easier. When the króna falls again during the next days and weeks I will buy it so fucking cheap that I will laugh all the way to the bank. And then I will put a great part of my moneys into an account where I can get those high interest monthly. Things just seem to get better and better for me. I just can believe it, making so much profit of this nations ignorance.
As I am going to win so much money again I will also go and buy one of those fancy VOLVOs that I have seen for sale at a very cheap price because their icelandic owners just cannot pay for them. I will go and pay it all at once. Buy me clothes for 200.000 krónurs and invite my polish friends to the most expensive restaurant I can find. Because it is just a pleasure for me to see how those people are served by icelanders. I want to see how they eat their good meals and drink expensive wine, and I want to see the face of the icelanders as they see them do that. And I will pay for it all with the profit I am doing out of your ignorance. I just can believe it!! :D
I am so lucky to be from a country where it is a strong culture of working and saving. In Switzerland we are very cautious and we don’t cause problems to other nations. I remember when some icelanders where putting placards everywhere saying something like you should imitate Switzerland, but you were saying it in the way of getting rid of foreigners… That happened when this country was at the top of your arrogance and selfishness. In Switzerland we don’t want to get rid of foreigners because they are a very important element in our industry. We just wont to get rid of criminals coming from many countries that are organized mafias acting in a way we have never experienced before. But still that does not give us the right to look down at any foreigner, specially those coming from eastern european and asian countries. Those people are hard honest workers and that is something that we traditionally respect very much in my country. We are not known for being racists and we treat foreigners very well. We are a nation formed by different cultural backgrounds and we are very mix. We have four national languages ( italian, french, german and romanscht, spoken in an incredible diversity of local dialects) We are an INTERCULTURAL COUNTRY that has built up a common culture of its own, a culture based on tolerance and respect. Even the richest people of my country would never look down to someone as such behavior for us is a sign of ignorance. We are an example of democracy and welfare society as there is no other in the whole world. And we are always open to learn and accept our mistakes. There have been some situations lately where racism has been present in our country, we admit that those things are happening and we want to eliminate those things because it is bad for your international image, and, essentially because it is against our national values.
We do not make international propaganda to put ourselves above other nations or cultures. But we like to be an example of stability and peace for the rest of the world. We have no participated in any war, the wars where the rest of the nations have always destroyed each other because of the arrogance and ignorance of your politicians.
Icelanders in general are responsible for all what is happening to them because of their own arrogance and ignorance as a nation and society. I was watching TV this evening and that was what some icelanders themselves were saying there. If this society was more cautious and had other values I am sure that not even the deepest global crisis could ever put you where you are now. And wait until the euro gets to 300isk or more. Then you will see what I am talking about.
I feel sorry for what is happening to this country. But you need to recognize your mistakes, and interact with the world differently. Put your ego at the right place. Be a nation of tolerance, a good example for the rest of the world. But it is not my opinion, but an international opinion, that icelanders are now to be seen as an example for the rest of the world about how a society should not behave. I am the craziest person you could ever find, but still. I have been always told by my parents how I should do with money matters. It is not common for a swiss to take a loan if it is not really necessary. And we borrow just what we need. We are a society where the majority of people start making savings since they are very young. As saving is part of our cultural heritage. Icelanders have been living much above their possibilities. And you are not ready. Companies are closing and thousands loosing their jobs every week. People that have lost everything they have, their houses, moneys, cars, everything!!! This is just something that needed to happen to this country so you could have the opportunity of learning how to be better than you are. Now icelanders are starting to see that they are just like any other human being in the world, not less, not more.
>>>>”… Those are the traitors and they are all just a BIG MAFIA.”
>>>>That, “Bjarni” have to agree with…?
>>>>I mean, wasn’t what our friends Jón and Gudmundsson did???
There seems to be some misunderstanding what exactly Jon Asgeir and Bjorgolfur Thor exactly are. They are Icelandic businessmen, that have been buying Icelandic and foreign companies, with loans from Icelandic and foreign banks.
If we find out in due course that they broke any laws, they will be prosecuted and convicted and appropriate punishment meted out.
There is already some information coming out (leaked) that some of the loans issued by the Icelandic banks may not have been processed correctly (MBL had a long article on Glitnir’s loan book this weekend), but it remains to be seen (and proven) if those two are in any way involved.
If on the other hand, we find out that Jon Asgeir and Bjorgolfur, received legimate loans for legimate business reasons and they then pay them back on time and in full, then we have no reason or case to complain on anything about their activities. This is how business should be done and our societies are after all based on laws.
Some nasty words towards Icelanders and Americans here. EVERYONE – every single country and person who is involved in this global crisis is dominated by greed. Stop blaming and pointing fingers, and take responsibility. Here in the UK, the media is making it look like homeowners and credit cards owners were ‘innocent victims’. I think not! They were just as greedy as everyone else. Getting 125% mortgages – consumers took it without asking questions, of themselves or of the economy. We were getting so used to everything being so CHEAP – it’s the advertising logo of Asda, Tesco and Morrisons. Debt is not bad. Greed is. So put away the tears everyone, and the fingers – and TAKE responsibility for your own personal choices.
Yes, the idea of this kind of debt originated in the USA, but EACH person decided to act upon that idea. I didn’t hear anyone complaining when they could get easy mortgages and credit cards. We are finally learning that fairness is important, and not “how much can I get for as little as I can give”.
Lets face it Gus your full of SH**
i know that…..
BUT more importantly YOU know it TOO…
As you would squeal… HHHAAAAAAA..HHHHAAAAAA..HHHHAAAAAA…
Gray, Germany said:
“It was just the credit crunch that followed that finally burst their own, specific Icelandic, bubble. Any recession in financial markets would have sent Glitnir et al. on a downward spiral, so pointing fingers at the US is totally misleading.”
I don’t disagree with you, Gray,
But someone should tell the German leaders :)
German Leaders Blame U.S. for Financial Crisis
Chancellor Angela Merkel
“The United States, and let me emphasize, the United States is solely to be blamed for the financial crisis. They are the cause for the crisis and it is not Europe and it is not the Federal Republic of Germany.”
“Brought to Iceland to make this people live at a level they couldn’t afford. And for some icelandic business men to get HUGE amounts of money out of the country. Why don’t you ask those compatriots to bring the money back home? No, cuz they wont!! They rather prefer to see how their own country gets fucked up than bringing any help. Still, they are waiting for the doors to be opened so they can take out what they had left here. Those are the traitors and they are all just a BIG MAFIA.”
“Bjarni” have to agree with…?
I mean, wasn’t what our friends Jón and Gudmundsson did???
There are some spelling and grammar mistakes in the text I posted before. I just write too fast and don’t use to correct the text. Well, when I said “I made lost of money” I wanted to say ” I made LOTS of money”. There are other mistakes but, you can understand right?
Obs! By the way, This crisis is making me incredibly rich, 5 mill isk turned into 10 mill isk and now it is all about to turn into 20 millions as the króna will fall again!!! I have only euros and dollars my friend!!. I never believed this economy to be something real. I did sound pretty artificial for me. And I got ready since the first news coming around about icelandic bank system and economy…
I cannot express my satisfaction of being able to live with my euros in on of the cheapest countries in the world!! It is so nice to be here. But if you don’t need people like me we are always ready to go with our funds somewhere else where people can appreciate more what they get from us!.
Yes, start scaring more the foreigners, you don’t need the massive amount of money tourists and students are bringing to this country right?… Come on! start showing more respect to people from other countries, at least now that we seem to be so crucial for this country to fix its problems…
Our goverments are lending you money, we are bringing money to this country. It will be enough to just say THANK YOU and stop feeling superior and just talk about iceland this iceland that, come on, you are not the center of the universe.
Var ég ekki að skrifa eitthvað á íslensku rétt áðan? Skil ekki af hverju er ekki verið að látta textan birtast enþau sko.
Oh, I forgot, I speak very well Icelandic!!
I do not celebrate this country to go through this, what I celebrate a whole structure of social values and prejudices to melt down at the same time of the economy. Iceland needs to be rebuild on other grounds ( not only economical but also social) I have an icelandic family who are like my parents, of course there is wonderful people here. And I can consider myself lucky because in the situation I am being a foreigner. High level of education, lots of money, an enviable job, etc… But I cannot deny the situation of most of foreign people who live here, who has been treated as second class citizens for years. It is just not fair at all, and whatever it is, every human being deserve RESPECT.
In this country I have seen people telling me bad things because being a foreigner, I have even been pushed. Discriminated in many occasions, most of the time in silent and subtle ways. There is active and also passive racism, that occurs in many ways. I have felt how the bast majority of icelanders use to act with foreigners as if they were coming from another planet. Wake up!! You are missing a lot, you could learn a lot, mix with as and all that is good about intercultural sharing.
Someone said that any culture locked into itself is just going to keep there isolated. And it will not grow. With all the myths of icelandic purity, the viking stuff and the recent mental masturbation of “we are rich” this country has put itself at the verge of the chaos.
I love this country very much. But it is time to speak out, the truth. And it is time for this society to recognize its mistakes and try to be a better society. I am lucky to have received a good education and I have been always told not to look down into anyone and that everyone deserve respect.
Now that you are a poor country you clearly see that you are just people, like everyone else, like the polish or the thai. Now that you are poor you are getting to be more human and value what is most important of all. I have many icelandic friends that agree with me. Specially people who has been living in other countries for some time. Not just going for week vacations to buy all around when the króna was strong, playing the game of being rich when all you were getting is bigger and bigger debts, burning your credit cards as money was easy to borrow. Where did all this money came from? Essentially from the IceSave founds and other icelandic founds, yes. Brought to Iceland to make this people live at a level they couldn’t afford. And for some icelandic business men to get HUGE amounts of money out of the country. Why don’t you ask those compatriots to bring the money back home? No, cuz they wont!! They rather prefer to see how their own country gets fucked up than bringing any help. Still, they are waiting for the doors to be opened so they can take out what they had left here. Those are the traitors and they are all just a BIG MAFIA. They fooled all icelanders, they fooled people abroad. Now the icelandic people have to be blame for all this. But people, you is also to blame because you forgot the essentials of your traditional life of being workers and save for the future. But this last generation of icelanders you just fucked up this country. It makes me almost cry when I look at the children and young people I teach, because they are facing the worst because of the stupidity of their parents and this mafia of goverment and bankers we have. THIS IS JUST LIKE IT WAS IN ARGENTINA.. Don’t cry for meeeee Icelaaaaaannnndd, my soul will always with you!!!
Really I am happy I made lost of money, but it makes me also really sad to see this happening to this country. But you icelanders you have to put hands together with the new icelanders who are doing so much for this country and the only way we are going to make it is by joining forces together and respect and understand each other. So no more discrimination and no more looking down to people. Be open, nice and comprehensive, be not scared of changing and adopting things from other cultures… There are new icelanders who feel more love for this country than many icelanders that have taken all the moneys out to save their asses, while the rest of the population was partying and wasting in the dream and lie they were told of being rich.
And you know what? I have been cooking for 4 during this month, inviting to my house icelandic students of the university who live nearby and need support because their families are in total bankruptcy. Supporting them with my food, my emotional support and my songs, inviting them for a beer and trying to make everyone feel good. And I know of many other new icelanders doing the same because we have such a big heart. We wanted to love and be loved. We haven’t been loved that much, and now maybe it is the moment where we should all learn how to respect and love each other. So no more discrimination and bullshit.
This is nothing about being “Pro” or not “Pro-Iceland”…
The immaturity of your comments just show or childish you are!
Maybe your comments are edited because they are incomprehensible?
I am from a very small village in a small island. Walking between the poorest I have never felt bigger than them and being in the streets of a modern european capital I never felt less. Because I am a human being. But I always knew that, coming from such a small context I needed to be open to learn from other places and people if I was to be a better human being. But then you see this icelander farmers ( I grew up as a farmer as well) that they get to buy those expensive cars and try to live like the european elite when they not have culture at all, they don’t know how to sit or behave in public ( go partying to Reykjavík and you will see what is totally uncivilized people), behaving like animals , and then they looked down to foreigners who come from nations with a millenary history of human proficiency and civilization. Oh yes,, of course I am laughing at them everyday since this crisis started… (and will get worse) because they know look down to the floor when they see a foreigner, because just some weeks ago they were acting so bad with them, talking shit about polish people, among people from other nations, and then they go cap on hand nocking at the door of those nations goverments beggin for som coins… HAHAHAHHAHAHAHAHAHHAAHAHAHAHHA :D
[…] diesem Bericht (hier – in Englisch) geben diese drei Länder Kredite in einer Gesamthöhe von 5 Milliarden […]
Just listen to yourselfs. You Europeans blaming icelandic people again. Its only paper! It will get sorted so stop bitching.
Have a smoke or something. Be happy that the money is coming around.
To Paul (UK):
>>>>Why not confiscate from each Icelander their brand new BMW 740 or Mercedes 600 they bought with the Icesave accounts? After all they were supposed to be the richest and best country in the world, they can afford not to go to Dubai or the Seychelles this Christmas.
I have not seen many “BMW 740 or Mercedes 600” driven around here in Iceland, and neither have I noticed that many people are going to “Dubai or the Seychelles”. Icelanders actually tend to stay home during Christmas with their families. Where exactly are you getting this information from?
To Joep Meloen:
>>>>Civilian Icelanders bought large houses, expensive cars, loads of other stuff they couldn’t afford, with money they didn’t own. The Staes may have invented the “debt system” you mention, but the Icelanders perfected it. Why don’t Icelanders just take responsibility of the mess they caused, pay back the people they robbed, and start over again?
There seems to be mistaken believe here, that most of the money that was deposited and/or loaned to the Icelandic banks ended up in Iceland were it was all just wasted on “large houses, expensive cars, loads of other stuff they couldn’t afford, with money they didn’t own”.
While some people in Iceland may have been buying too much stuff, I would submit that there were many people in Iceland that did not. Just like in most other countries, there are both rich and poor people in Iceland, and some of them borrow more than they should.
Here is a list of how the assets (loans and bonds) of the Icelandic banks were distributed between different currencies:
This table is in Euros, based on the balance sheets in the annual reports 2007 of all three Icelandic banks added together. As you can see, while large amount was in ISK, it was only about 20% of the total amount that was lent out and/or indebted. Would you count the other 80% as also having “robbed” the depositors and the lenders?
It is the fundamental responsibility of those that borrow money to pay it back on time. Right to the end, the Icelandic banks had very low impairment ratio on their loans compared to most other banks. This means almost everyone (Icelandic/foreign) was still current on their loan payments with their banks (no toxic debt).
The Icelandic people and companies that borrowed from the Icelandic banks, will of course continue to pay off those loans (at least those that do not go bankrupt), as should all the people and companies in the other countries.
This is the only way in the end, everyone will end up getting most of the money back that was either deposited or loaned to the Icelandic banks.
oh..wait…since I can now…with delayed efforts…heres a thought of the general Icelandic public…BLOODMONEY!!!, for an general Icelandic regestered company, owned by some individuals, operation abroad and paying theyr taxes all around.
Read the EFTA treaty regarding banking, and don’t give a damm.
Don’t worry, be happy, it won’t happen to YOU!!!
have nice day….;)
Be noticed, that it seems this site is controlled regarding to comments, I’ve posted numerous, ever wondered why no Pro-Icelandic comments are here?
Oh, by the way — remember that $2.1 billion IMF loan that opened the door to further loans from the Nordics? Well, $378 million of it came courtesy of the U.S. taxpayer. So much for the dirty rotten Yankees.
Totally agree on this one!
HAHAHAHHAAH,I just couldn’t laugh more!! There dozens of tiny nations, smaller than Iceland, that are economically wealthy even in times like this. The recipe? Don’t buy what you cannot pay, and, what is more important, don’t get debts until de point you owe 9 times more than what you “really” have or produce.
Icelanders have been living pretty much at a higher level than they could possibly afford. All that stories you have been told by the TV and other media telling you were rich… they were nothing but pure mithology ( They are not empirically verifiable, experimentally duplicable, nor fact-linked, just constructed on presumptions rather than on real circumstances). You icelanders just wont to accept that. Tell me, how many people do you now in your country that haven’t get in heavy debt for at least the next 40 years to buy a nice house and a nice car?. You should know that workers, people of the common class in other european countries take the bus, the train or share cars to go to work, they don’t use to risk and buy a mercedes benz or a BMW when they know they just can afford a cheaper renault or fiat; they don’t buy a nice apartment or house, like most of the icelanders have been doing these last years, selling their old houses to buy much better, bigger and nicer ones…. Almost everyone in this country got heavily in debt. Students got loans for studying and most of them don’t even wanted to work during the summer or studying periods, like most of european students. And they also got another loan for buying a fancy car to drive to the university… Now they are starting to walk and take the bus as they cannot pay those expensive cars anymore. Just tell me: what is doing a 23 years old girl with a brand new luxury leather seats VOLVO, when she has not even finished her studies? She thought she was going to finish her BA in engineering and then pay the study loan and the car… HAHAHAHAHA She is almost living in the street now because she can hardly pay the rent and food. She is even thinking about going to work abroad after she finish her studies, so she can be able to pay her study loan. She is praying for someone to buy her car (as many icelanders are) so she can get rid of the car loan payments. There are no jobs in Iceland for people like her as dozens of companies are in bankruptcy every week. What is she expecting to work in abroad with so much unemployment going on in every country?…
What icelanders really failed in is that they have not been cautious at all. They thought they were really rich and they told that to every foreigner coming to this country. The bought as fools what they could not pay. And you see now what is going on.
At last somebody who agrees with me about the US…
So, again, none of this is the fault of Iceland?
Iceland, and here I mean the people and not the government, chose to be a small nation. They chose to have their own currency. That’s fair enough, but is only really suitable for a basic economy. They also chose, as individuals, to borrow, often in foreign currency.
Iceland, the government, chose to deregulate the banks. They chose to let them get too large.
So it really doesn’t matter who is to blame for the change in global events. Iceland, the people and the government, are responsible for the functioning of Iceland. If you honestly believe that your government could not be expected to manage the banks correctly, then you need to ask yourself if the Icelandic state is viable.
The Iceladic Bankers have behaved like Bandits.
Just look at the schemes that came from Landsbanki Luxembourg and other Icelandic Banks on EQUITY RELEASE LOANS aimed at old pensioners.
The bankers bought nothing but Icelandic stock in failing banks when they knew they were failing, for these vulnerable people so that their portfolios are worthless and they are now losing their homes and all their savings.
Luxembourg law has no protection for the victims but has laws which protect the banks.
This is all going to be exposed along with the Bandit Banks and Bankers who are worse than criminal.
Olof, sry, bt this looks like you’re still looking for excuses for Iceland’s government. But many of your points don’t hold water:
“a country like Iceland with the smallest,free-floating currency got hit the hardest”
Yes, obviously, right? And then, why did’t the government do anything against that? Iceland could have joined the Eurozone years ago, when it was much easier to do so than in the current downturn!
“everybody could benefit by looking at the real cause of this crisis and point your fingers towards the right direction…i.e.. The States”
Icelands banks made many mistakes, but getting fooled into mortgage “investments” wasn’t among them. It was just the credit crunch that followed that finally burst their own, specific Icelandic, bubble. Any recession in financial markets would have sent Glitnir et al. on a downward spiral, so pointing fingers at the US is totally misleading.
“Do you think any government can over power a run-away banking system..”
Governemnts CAN pretend their banking systems from running amok, that’s the real point! Other small countries like Liechtenstein did so, and their banks haven’t crashed.
“and the banks will be running them…not the government elected by the people”
Only if the people let that happen. It doesn’t have to be a violent revolution, there are lots of examples where the peaceful but determined opposition of the majority forced governments to step down. Many Icelanders already engaged in such protests, and if others would stop looking for excses and instead join them, change could happen. Resignation isn’t the answer, making one’s voice heard is!
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In other words, the thieve gets a loan in order to return the money to its owners!!!!
Why not confiscate from each Icelander their brand new BMW 740 or Mercedes 600 they bought with the Icesave accounts? After all they were supposed to be the richest and best country in the world, they can afford not to go to Dubai or the Seychelles this Christmas.
In other words, the thieve gets a loan in order to return the money to its owners!!!!
Why not confiscate from each Icelander their brand new BMW 740 or Mercedes 600 they bought with the Icesave accounts? After all they were supposed to be the richest and best country in the world, they can afford not to go to Dubai or the Seychelles this Christmas.
“The world is in a depression”
No, actually it isn’t.
Just wondering, if I leverage myself up 60x my capital using foreign money no less! And that money decides to go back home, do I point my finger at the US when the game is up? That’s priceless.
Here’s an statment by an Uk bank from an general Icelandic company trying to conduct buisness….„The … Bank, in line with other global banks operating in the UK, is required to comply with The Landsbanki Freezing Order 2008, issued by the UK Government. This order is binding on all banks operating or present in the UK and places specific restrictions on transactions involving Landisbanki and certain other named entities. In order to comply with our legal obligations we will refuse to process or handle certain transactions. Unfortunately this specific transaction falls into that category.“
Olof Asdis, why can not Icelanders take responsibility for the actions of their banks and their government? You’ve blamed everybody but those whose actions landed you in this fix. And that includes you.
Hello Olof Asdis,
I know that the situation is tough in iceland right now and that the inflation, the exchange rate and the loss of value in housing (and so on) are demanding a lot of the icelandic people, but do you honestly believe, that the icelanders are suffering so much more than the other europeans affected by the icelandic crisis?
People in iceland have not lost most of their savings like the dutch, german and british depositors who will only get the little amount of 20887 € back. Many of the foreign small depositors have lost major amounts of their life savings.
I am personally starting to be really offended by the lack of humility and respect for the foreign savers that icelanders show all over the icelandic media.
The icelandic state and society has completely failed to take control of its banking system and in parallel the icelanders have all (!) done their part by consuming like crazy. As long as everything went well for the icelanders, no one complained and now, people are denying all responsibility. Just blaming the worlds finance system for this crisis is just stupid…
i hope iceland learns from this experience, but right now it certainly does not look like that.
America? This is not the first time i have heard someone blame america. America just put 700 billion dollars of their own money into banking to try to help. How much has iceland put into the economy to help? America bet like everyone else, but had the money to back the bet up. Even though your culture may not believe in keepin its word, the rest of western cilization still believes word is bond.
@ olof asdis
Civilian Icelanders bought large houses, expensive cars, loads of other stuff they couldn’t afford, with money they didn’t own. The Staes may have invented the “debt system” you mention, but the Icelanders perfected it. Why don’t Icelanders just take responsibility of the mess they caused, pay back the people they robbed, and start over again?
Directed at olof asdis
But if the Icelandic Goverment had not instigated this problem by stealing bona fida savings accounts, followed by the insults thrown by the Icelandic population at the countries that are now bailing you out, then this problem would not have occured.
olof asdis said:
You cannot blame anyone but the Icelandic banks and Government – they saw the opportunity and took it regardless of the risk. Nobody forced them to take up the US banking model.
Have a look at that:
Your four nordic friends are coming to your help, Icelanders. :-) Time to cheer up a bit, I suppose. For your president it should be a time to say ‘sorry’, though.
…USA is the real cause of this crisis”. So,Iceland bank staff are simple minded and did not evaluate the structures of the money instruments they bought? The banks, and the investors in Iceland, were greedy. Greed=’biggest motivator!’ Please, Icelandic citizens –STOP blaming everyone else, except yourselves, for making bad choices! If I, in any way, had have had anything to say to the IMF, there is NO way I would have loaned you ingrates a single Euro!–
Thank you…But, nobody is getting crapped on more than civilian Icelanders and their children plus grandchildren…The world is in a depression…a country like Iceland with the smallest,free-floating currency got hit the hardest…this of course affected all financial institutions in and outside of Iceland…I think everybody could benefit by looking at the real cause of this crisis and point your fingers towards the right direction…i.e.. The States..with their “debt” system and all other connections to it´s brilliant banking system as the source of the real “Crapping” on other countries…Finger pointing at the first country to fall is just plain bullying. Try to realize this is a domino effect of a much grander score…Do you really think a little country like Iceland actually had some kind of power in this?…Do you think any government can over power a run-away banking system..Iceland has lost it´s banks..the government can not manage them without outside influence…this is going to spread until their is one or maybe two Superpower countries standing…and the banks will be running them…not the government elected by the people.
Iceland – I think the words are – sorry for crapping on you – Holland, Germany and UK – and thank you for helping us out – or are there no words in the ‘hubristic Icelandic lexicon’ for such words.