The delay in payment of the second instalment of the IMF loan to Iceland is having little or no effect on the state of the Icelandic economy, according to IMF representative in Iceland Franek Rozwadowski. The delay in the payment comes mainly due to technical issues arising from the financial system, as well as from the political uncertainty after the resignation of the previous government.
“The work has taken longer than expected, among other areas in the restructuring of the banking system. It made a huge difference that there was a change of government earlier in the year. While that was going on, the work almost stopped altogether,” Rozwadowski told Morgunbladid.
The first loan payment from the expected total of USD 2.1 billion, was paid in December and amounted to a sum of USD 830 million. That money has barely been used as yet; and the recovery plan between the IMF and the Icelandic government does not anticipate a need to use money from the Fund directly to pay off liabilities, mbl.is reports.
The original plan called for an additional payment of USD 155 million to be paid to Iceland at the beginning of March this year, after the appraisal of the old banks’ assets and debts. Due to delays in the financial restructuring and the recent political uncertainty, the IMF and Icelandic financial plan has been delayed by a minimum of two-and-a-half months compared to the original schedule.
Rozwadowski says that the IMF and the new government will need to sit down together after this Saturday’s elections and rework some details of the deal to help achieve the goals which were originally set. “We will be back in business right after the election. We will be waiting for a call from the new government as soon as possible and then the discussions can begin. They will probably last several days, and then the work can continue in the agreed direction. […] What makes the most difference is that we continue to work on the plan to achieve the goals which have been set. It doesn’t really make any difference if the loan payment is several weeks or months later than had been expected,” Rozwadowski said.
Yes, that is because fiat currency is a slight of hand trick by the governments that issue them. And therre is no control on government debasing of currencys.
In the case of the Euro it has been all about Germany’s productive powers supporting it value — and perhaps a couple of other memberstate.
Government no longer have discipline of silver/gold standard which always went anyway when wars or welfare state needed.
Why exactly is that it is fiat currency that they want stop it being held in other country. Eurdollar and offshore holding moneys of Euro is not under they control.
It is in they country interest to have foreigner hold they currency offshore. Look at US dollar and see how that has held up they economy for decades as they overspend and debase currency at home.
“As I and others have said the existing claims need to be met (Icelandic assets need to be handed over – at least in beneficial form – to the creditors) and when everything has gone, the country will automatically go into sovereign default. ”
Yes bill need to be paid. But I do not see this sovereign debt inevitble.
Davið made big case of careful spending and paying down government debt. Perhaps if crazy Left-Green Sociali Democrat are in and do usual stupid stuff things get worse.
That government spend its reserves carefully that is not sovereign default coming. They pay they bills.
Mike (UK Nordic analyst) said: “As I and others have said the existing claims need to be met (Icelandic assets need to be handed over – at least in beneficial form – to the creditors) and when everything has gone, the country will automatically go into sovereign default. That is the reality of the current situation – still not understood by many Icelanders”
———————————————
Existing claims need to met? With what and how?
You mean, met like Germany met post WW1?
It sounds like you are speaking for the creditors.
Investment is a risk.
Creditors need to get real as well as icelanders as would independant economic observers also point out
http://www.davidmcwilliams.ie/2009/03/30/the-icelandic-conundrum
“This morning’s plane from Reykjavik to London is full of bankers and their lawyers who are trying of get their money back.
They have no chance, because Iceland is bust. Like Ireland, some Icelanders went on a borrowing binge, buying assets everywhere. The assets have collapsed in value, the cash is gone and there is no money left to pay the debts.”
“I’m thinking about this as the bankers beside me are trying to figure out away to ensnare the Icelandic population and make them pay for the greed of a few individuals who broke the country.”
As always the issue is not the ISK inside Iceland but that outside.
To answer your queries: a unit of currency outside a geographic zone of circulation represents a claim against the productivity of that zone. It is an unsatisfied debt, it is a promisory note against an entire national (or supra-national) economic entity.
That is why countries cannot unilaterally switch from one currency to another. If Iceland switched from ISK to EUR the implication is that the debt that Iceland currently has due to its past consumer and commercial splurge would now become a debt on the Euro zone countries – which they certainly would not accept. (That is the theory of the end result – it would never get that far down the road in practical economic, financial or political terms.)
As I and others have said the existing claims need to be met (Icelandic assets need to be handed over – at least in beneficial form – to the creditors) and when everything has gone, the country will automatically go into sovereign default. That is the reality of the current situation – still not understood by many Icelanders (especially the politicians it would seem). Denial is the word.
“When Alcoa Inc. prepared to build an aluminum smelting plant in Iceland in 2004, the government forced it to hire an expert to assure that none of the country’s legendary “hidden people” lived underneath the property. ”
Maybe that’s where the money went. The “hidden people” spent it ?
For those of you that things are getting better or even will eventually get better. Like me and others have said it before, icelnad has two options: bancrupcy or BANCRUPCY. no matter who wins on saturday or who looses the only difference is how are they going to let os have it.(the bankrupcy i mean)
Both in English and Icelandic links:
http://www.newsfrettir.com/index.php?option=com_content&view=article&id=569:sigmundur-david-predicts-another-collapse&catid=30:national-finance&Itemid=47
http://mbl.is/mm/frettir/kosningar/2009/04/23/sigmundur_david_spair_odru_hruni/
EVERYONE COMPARE ICELAND WITH ZIMBAWE, WELL THE ONLY THING I CAN SAY IS THAT AT LEAST THERE IS WARM AND YOU SEE MORE SUNNY DAYS!!!
( THIS IS THE JOKE OF THE DAY!!, HAHAHAHAH ;-)
LETS TAKE THIS KREPPA AT LEAST WITH SOME SENSE OF HUMOR. BECAUSE IF NOT WE WILL ALL JUST GET CRAZY WITH IT.
OYSTEN, THE ONLY THING I CAN SAY IS THAT YOU ARE A GENIOUS.
YOU HAVE TOTALLY DECODED WHAT THE MESSAGE HIDDEN IN MY POST WAS…
DARLING, BROWN, … AND THE INTERNATIONAL TRAGIC SCENARIO…
THE WHOLE STUFF OF TRYING TO MAKE US ALL HERE BELIEVE THAT IF IT IS NOT BECAUSE OF THE INTERNATIONAL CRISIS THEN IT IS ABOUT SOME BAD GUY OR GOVERNMENT OUT THERE BEING THE CAUSE OF OUR LIFE IMPOSSIBLE HERE.
AND THAT IS CHEAP STUFF AND PLAYING TO BE LOOSERS AND THE VICTIMS AND TRYING TO DRIVE PEOPLES ATTENTION HERE AND THERE…
ALL THAT S**T ISN´T GOING TO HELP US GET ANY BETTER. WE ARE JUST CREATING ENEMIES EVERYWHERE. AND I SAY WE BECAUSE AS LONG AS I LIVE HERE I WILL HAVE TO DEAL WITH THE SITUATION LIKE ANYONE ELSE.
SO OYSTEN I DON´T GIVE A DAM S**T FOR WHAT IS REALLY HAPPENING OUT THERE.
I HOPE THAT KNOWING THAT THE SITUATION IN ICELAND IS GOING TO GET WORSE ( THEY ARE SAYING THAT PEOPLE WILL KEEP GOING TO LOOS THEIR JOBS UNTIL THE END, OR AT LEAST WHAT THE CALL THE TOP OF THIS, THE END OF 2010) SO, GOOD LUCK!!
AND NOW THEY WANT US TO LOOK TO WHAT IS HAPPENING OUT THERE AND DON´T CARE FOR WHAT IS HAPPENING HERE… CAMON LITTLE LAMBS, THIS WAY… WE WILL TAKE CARE OF YOU ( AND YOUR MONEYS, OR WHAT IS LEFT OF IT)
I HOPE THAT AFTER ONE YEAR WE CAN AT LEAST COMMUNICATE BY RADIO.. BECAUSE AT THIS PACE WE WON´T EVEN HAVE FOR THE INTERNET BILL…
YEAH, WE ARE GOING TO END LIKE AN ISOLATED COUNTRY ( A VIKING ONE, HAHAHA). TOURIST WILL COME AND THROW CARAMELS TO THE KIDS. WOMEN WILL BE KNITTING SWEATERS TO SELL AND MEN FISHING AND TAKING CARE OF THE HORSES AND THE COWS …
WE WILL FRESH EGGS IN THE MORNING AND LAMBALÆRI FOR DINNER. WE WILL HAVE ELECTRICITY, WICH IS GREAT BY THE WAY, BUT NOT A REFRIGERATOR.. HAHA, WELL, WHO NEEDS A REFRIGERATOR, JUST BUILD AN ECOLOGIC ONE OUSIDE ( IT IS AROUND 0 MORE THAN 6 MONTHS A YEAR). WE WILL KEEP TALKING ABOUT HOW MUCH ENERGY WE HAD, BUT THAT WE ARE SO INCOMPETENT THAT THE BEST USE WE CAN MAKE OF IT IS TO BUILD ALUMINIUM FACTORIES THAT ARE A MESS FOR THE ENVIRONMENT AND AT THE END LESS NOT GREAT BENEFITS AND THIS COUNTRY DEPENDING ON THE GLOBAL MARKET TO DECIDE FOR THE PRICE OF THE FINAL PRODUCT. LETS SAY, THAT THE INDEPENDENT PARTY HAS LET US DEPENDING FROM THE OUTSIDE FOR A BIG PART OF THE ECONOMY. AND NOT ONLY THAT, ALSO LET US INHERITATE A TOTALLY COLLAPSED ECONOMY, NATIONALIZED BANKS AND A DOMESTIC TRAGEDY.
Niels, Iceland could always adopt the dollar, no problem (but without resort to US Treasury as lender-of-last resort). No need to ask for permission. Panama uses the dollar, and Ecuador too (starting in 2000), and some countries have more or less dollar-pegged currencies – Barbados, Argentina, Belize. The dollar solved Ecuador’s hyper-inflation problem for a while but now it is thinking of giving up on the dollar because it has defaulted on its sovereign bonds.
The danger of course is that the dollar is going to lose even more of its value now the the US has been issuing money out of thin air to pay for the bank and credit problems.
I suppose you could officially adopt the dollar and as soon as the government and banks get them, change them into Canadian dollars or Japanese yen, or hedge in some other way against a falling dollar.
>Why,for instance, does not Zimbabwe replace its dead currency with the euro, or even the south african rand?
I suspect we’re back to the point that one needs something of value to offer in order to physically get cash money (let alone credit) into the country.
In Zim’s case, that would be? Even if someone accepted a lien on Zim’s physical resources (i.e. minerals, as agriculture is buggered), who’s to say it won’t be nationalised two days later.
Ultimately, it’s difficult to see how the IP thinks that this is possible (assuming that they really do). Even if they manage to spirit boatloads of euros into Iceland, it won’t do them any good if the EU kicks them out of the EEA. Of course they could then switch to trading with Norway, Russia, US, whoever, but then why bother taking up the euro in the first place.
Hi Fisy,
The idea of SDR is an interesting one. Basically (afaik) it has been put forward not only by China but also by Russia in order to challenge the position of the USD .
Both nations have LOTS of USD’s (China by exporting industrial products, Russia by selling oil and gas) and they have a problem: what to do with these huge reserves? They have bought lots of US bonds …but what to do with them? It is clear they do not just want to depend on the US economy.
Now SDR’s are basically an articifial currency based on a basket of the world’s major currencies (USD, EURO, Yen, GBP). It could be turned into a currency and Iceland could start using it….but the problem of the ‘dead’ krona remains. The krona has no value against these currencies, so howto exchange?.
Indeed Iceland probably will have to offer its own resources as a security (and probably these securities have already been taken over by creditors)…and off course also foreign creditors must get the assurance that they will be able to get their profits out of Iceland.
So the idea is a good one but I do have serious doubts about its feasibility.
I do also doubt if it is possible to “take over” a foreign currency (without consent of the foreign party) and start using it as your own. Now I am not an expert on this and I am really interested in the opinions of others on this. I do not know any case in which a country with a ‘dead’ currency adopts (‘steals’) the healthy currency of another country.
If this would be possible, then why hasn’t it been done before? Why,for instance, does not Zimbabwe replace its dead currency with the euro, or even the south african rand?
As for the euro,the ECB makes all kinds of demands on member states that want to adopt it. The ECB certainly will not allow another country to take the euro without fullfilling conditions.
> GUS. Don´t worry, I doubt you are able to hurt me through your postings. I think that those who need to be informed on the situation on Iceland, are very well informed.
I if you don´t accept that there are other who also have problems these days – then you are living in a fiction world.
“Darling” – I am not sure if like it – You see, “Darling” in connection to persons living in Iceland may be misunderstood.
[…] Iceland Review und IceNews (beide in […]
Mike (UK Nordic analyst):
So do I start to sweat now and shout conspiracy or just wait a bit?
https://www.icenews.is/index.php/2009/04/15/dutch-savers-demand-answers-from-iceland/comment-page-1/#comment-72438
P.S. Iceland could also protect itself by turning Krona into SDRs instead.
Why risk exposure to Euro alone?
Smartest Central Banker of 21st Century who is in China now propose similiar thing.
You notice he not suggest China taking Euro instead of USD as reserve currency but instead SDR which basket of them.
Hello Niels, I am in a hurry but will comment on these quickly:
>Theoretically this would mean using the ECB rate for the ISK (about 300 isk to 1 euro) and certainly not the ‘fantasy rate’ which in this world is only recognized by the icelandic national bank.
Yes, the market rate, but could for example they do deal with some third party involving for example bond from income of future oil and gas tax receipts.
With sweetener like that it not impossible or even out of realm of possibility. But still I not convinced it has to be Euro. Pegging Krona to another also viable solution.
But none these, join EU, talk of join EU is going to do anything until foreign investors get money out of Glacier bond etc.
Simply that is the main issue now.
>Moreover the ECB would have to give permission for this transaction and there have been very clear signals that the ECB does not agree
No. The owners would simply transfer the Euros to the account of the Icelandic Central bank.
Could just do it via SWIFT. Then they have in book entry the country Euro assets.
Already this how the Central Bank have its reserves and monies spent by IMF.
Which are not all spent at all despite what Easy say. And not give proof it has.
EU can’t stop that — unless it in fact is hell bent on forcing Iceland to go into EU. That political. Not economics.
PEOPLE TELLING THIS “NEGATIVE” TRUTH HAVE BEEN ALMOST ALL SYSTEMATICALLY REMOVED FROM THE DIFFERENT MEDIA. AND A “HOW-BAD-OTHERS-ARE-DOING” PROPAGANDA HAS BEEN THE ONLY ANSWER. MOST OF THE NEWS ARE ABOUT HOW BAD ARE THINGS IN OTHER COUNTRIES AND HOW WELL THEY ARE GETTING HERE…
HAHAHAHAHAH,,, REALLY, I CANNOT BELIEVE THAT THIS IS REALLY HAPPENING.. SOMETIMES I WISH IT WAS JUST A NIGHTMARE AND THEN WAKE UP AND SEE THAT EVERYTHING IS OK, BUT IT ISN´T…
TODAY I WENT TO SAY GOODBYE TO AN ICELANDIC FRIEND. IT WAS REALLY EMOTIONATING TO SEE HIM HUGGING HIS DAUGHTER, WIFE AND SON BEFORE HE LEFT FOR NORWAY, TO GO AND TRY TO FIND A JOB THERE. THEY ARE HOPING THAT THE REST OF THE FAMILY CAN FOLLOW HIM SOON. AND BELIEVE ME, THAT GUY LOVES THEIR FAMILY VERY MUCH…
SO, NOW, I CAN TELL YOU THAT THE SITUATION IN ICELAND IS VERY BAD, WORSE THAT IT SEEMS.
YOU SEE COUNTRIES LIKE SPAIN OR ITALY? UNEMPLOYMENT YES, BUT PEOPLE HAS AN UNEMPLOYMENT PENSION THAT PERMITS THEM TO SPEND THE WHOLE DAY AT THE BEACH DRINKING DAIKYRIS… HERE IN ICELAND PEOPLE CANNOT MAKE A LIFE, PAY MORTAGE, CARS AND FEED THEIR CHILDREN WITH SUCH MISERY OF MONEY THAT IS NOT EVEN THE HALF OF WHAT THEY WERE MAKING WHEN THEY HAD A JOB. AND NOW THEY HAVE TO PAY THE DOUBLE FOR THE MOST IMPORTANT THINGS, FOOD, A HOME AND A CAR…
SO PLEASE… SOMETIMES REALITY IS THAT NEGATIVE… BUT IS REALITY
OYSTEN: “The sad thing is that this forum/blog is influenced by to many negative comments.”
OYSTEN DARLING, I DID NOT MEAN TO HURT YOU. BUT THE STUFF IS THAT WE ARE ALL TIRED OF THE SAME THING OF COMING UP WITH THE USUAL COMMENT ABOUT HOW BAD THINGS ARE SOMEWHERE ELSE.
WHAT WE WANT IS TO EXPOSE HERE HOW BAD THINGS ARE HERE, AND WE ALSO WANT TO MAKE CLEAR THE INCOMPETENCY OF THIS GOVERMENT… AND ALSO REMARK SOCIAL ATTITUDES WE CONSIDER HAVE HELPED THIS NATIONS TO BE IN THE SITUATION IT IS TODAY.
AS LONG AS WE ARE NOT TOTALLY AWARE OF ALL THOSE THINGS, AS LONG AS WE DENY IT, WE ARE NOT GOING TO GET BETTER.
YES, IT IS A LOT OF SHIT, AND IT IS SMELLING REALLY BAD. BUT THAT IS WHAT WE HAVE NOW… WE NEED TO START DOING SOME CLEANING JOB…
BUT WE CANNOT PRETEND TO KEEP THROWING RUBBISH, HIDING IT UNDER THE SOFA AND THE CARPET, WHEN IT IS IMPOSSIBLE TO SEE AND WATCH TV BECAUSE THE SMELL IS SO STRONG THAT A DEATH MAN WOULD COME TO LIVE BY BEING CLOSE TO IT…
> Icelandbob. I can promise you that there are a huge more people outside Iceland that belive in Hidden people, than in Iceland. Belive it or not – but stories about these people sell Iceland – so don´t touch/disturb them… :-> Tourism is important – hidden people is good for the guides and visitors, you need their help now.
What do you think make money in North of Finland? Have you heard about Trolls in Norway?
@ Vilhalm: Precisely. I believe this slow-motion collapse cannot be forestalled and that the role of government now is to protect the most vulnerable from its worst effects.
@Easy
“When Alcoa Inc. prepared to build an aluminum smelting plant in Iceland in 2004, the government forced it to hire an expert to assure that none of the country’s legendary “hidden people” lived underneath the property”
And the worst bit is that whole Alcoa story was complete b***ocks.
@Suomi, “National Bankruptcy” exists in theory, as sovereign default, but not in practice. Anyways, Iceland is currently going through a slow-motion national bankruptcy through the bankruptcy of the three nationalised banks. The creditors are getting all of the assets of the banks. We do not know exactly what the bank assets are, but they probably include a lot of “national” assets that were essentially sold to the banks for cash, by leveraging assets and pledging future income streams as collateral. This would include the fish quotas and fishing industry (leveraged @ at least 5-6:1), power and aluminum plants, agriculture. Plus lots of “big” Icelandic companies (probably including the ship companies) that took loans from the banks, so that the creditors are entitled to take over those debts, and as the saying goes, he who owns the debt owns the company. And probably the banks owned a lot of home and real estate mortgages so the creditors are entitled to those too.
The second stage of the national bankruptcy will occur when many homeowners, individuals and companies go insolvent, probably in a chain-reaction / implosion within the next several years. There is something like 3000 billion ISK of personal and company debt. Some (or a lot of this) is owed to the banks and therefore goes to the bank creditors (mostly the German bondholders) but there is probably a fair amount that goes to a different group of creditors.
The third stage will occur when the gubment essentially forces the pension funds to exchange their hard currency holdings for ISK bonds, which the broke and desperate gubment will use to fund its operations.
Iceland has been trying to resist with the fake “new bank – old bank” scheme, taking Icelandic assets from the old banks and putting them in new banks (controlled by the gubment) and paying “fair maket value” for the transferred assets (and cutting off secured claims from the pledged assets). At first the gubment said the foreign creditors would get only the old banks, but recently they have changed their opinion and said that the creditors can have some share of the new banks. Well, this is a half-clever scheme, if they can get away with it, because you can give the foreign creditors 49.9% of the new banks and it won’t make any difference, because the 51% controlled by the gubment makes the decisions. For instance, the 51% majority shareholder can write-off debts, or choose not to foreclose, and to retain earnings and not distribute them. The problem is that the new bank-old bank scheme will probably be wiped out by the IMF, or by the EU threatening to kick Iceland out of EFTA or rejecting its plans to join the EU.
So most likely the national bankruptcy will proceed to the bitter end over several years, first the large assets, then businesses and houses.
As I said before, the best solution for the gubment is to implement new, liberal bankruptcy laws that would let insolvent individuals continue to work and live in their homes by wiping out debts they cant pay, re-making old mortgages to present value, allowing 15000 euros basic survival per year, and allowing home exemptions (as they do in Florida, eg OJ Simpsons house) that lets homeowners stay in their homes. But no, the gubment will continue to try to cannibalize its own citizens.
On another subject, I see the the gubment has come to its senses and realised that tax claims defeat creditors claims and so is going to start a big investigation of the old banks with the FME and tax-collector.
“Átak til að rannsaka hugsanleg brot á skattalögum … Í viðræðum fjármálaráðuneytisins við skattrannsóknarstjóra og ríkisskattstjóra hefur komið fram að afar brýnt sé að hraða rannsókn hugsanlegra skattalagabrota í tengslum við fall bankanna og í starfsemi þeirra í aðdraganda fallsins hvort sem er hjá eigendum, stjórnendum eða starfsmönnum bankanna og félaga sem þeim tengjast. Í ljósi þess telja þessir aðilar æskilegt að aukinn þungi verði lagður í þetta verkefni hjá stofnunum skattsins …”
Please Øystein get a grip and face the music!!
Hi Fisy,
I think you are oversimplifying if you state that ‘much of the (icelandic) debt comes the loans that Iceland was forced to take by EU countries (in order to repay Icesave account holders).”
AFAIK the loans from the UK, Holland and Germany (respectively 2,6 b, 1,3 b , 1,1, b euro) total 5 billion euro. The total icelandic debt is much higher, some 50 billion
http://www.sedlabanki.is/?pageid=552&itemid=a55be3a0-9943-484e-a8de-46d23f17ba25&nextday=4&nextmonth=12
There even has been debate that the real debt is higher than this.
This debt has been accumulated by the now infamous icelandic financial wizzards. You cannot blame the EU for this .
I also do not think Iceland can just unilaterally decide (‘with approval by the IMF’ ) to adopt the euro (as Montenegro and Kosovo have done). Montenegro and Kosovo already used the DM (with permission by the ECB/German national bank) and when the DM was transformed into the euro they were able to go along by exchanging the DM’s circulating there into euro’s.
Iceland would have to exchange krona’s into euro’s…..and we all know about the krona….
Theoretically this would mean using the ECB rate for the ISK (about 300 isk to 1 euro) and certainly not the ‘fantasy rate’ which in this world is only recognized by the icelandic national bank.
Moreover the ECB would have to give permission for this transaction and there have been very clear signals that the ECB does not agree. They will only allow Iceland to join the EURO if Iceland will join the european monetary system….on the conditions of the EU off course.
Montenegro and Kosovo have been special cases: the introduction of DM/euro there have been deliberate political decisions of the EU (isolation of the Milosevic regime) . Iceland is a different story.
> GUS – There is a lot of information in those lines – if you don´t understand it, I can´t help you.
There are in fact people – inside/outside Iceland – that are positively working on solving the problems in Iceland.
The sad thing is that this forum/blog is influenced by to many negative comments.
The IMF is saying nice gentle things now so it isn’t seen to influence the election. After the election, it will play hardball with the new government as it seeks to asset strip the country. That’s inevitable.
how they perceive us arround outside Iceland, check the firts part of this article.
Iceland on the cutting edge
By Chuck Shepherd |email article|Lead Story
When Alcoa Inc. prepared to build an aluminum smelting plant in Iceland in 2004, the government forced it to hire an expert to assure that none of the country’s legendary “hidden people” lived underneath the property. The elf-like goblins provoke genuine apprehensiveness in many of the country’s 300,000 natives (who are all, reputedly, related by blood). An Alcoa spokesman told Vanity Fair writer Michael Lewis (for an April 2009 report) that the inspection (which delayed construction for six months) was costly but necessary: “(W)e couldn’t be in the position of acknowledging the existence of hidden people.” (Lewis offered several explanations for the country’s spectacular financial implosion in 2008, including Icelanders’ incomprehensible superiority complex that convinced many lifelong fishermen that they were gifted investment bankers.)
http://www.connectsavannah.com/news/article/100553/
ouch!! Far from the well educated people that the news here tell us that somebody said here or there and thats why we will bounce back fom this situation VERY QUICK!!!
A little Dictionary for the ones that need it:
“the country’s 300,000 natives (who are all, reputedly, related by blood)” Translation: Retarded or all with down syndrome
“Icelanders’ incomprehensible superiority complex that convinced many lifelong fishermen that they were gifted investment bankers.)” Translation: Stupid people
“The elf-like goblins provoke genuine apprehensiveness in many of the country’s 300,000 natives” Translation: Ignorants.
“none of the country’s legendary “hidden people” lived underneath the property”. Translation: WTF!!!
Really what a shame but this is really a view of many people towards us, besides CORRUPT. Pleasse vote wisely or better yet think about if any of the options are worthy. The ones that were before were just a bunch of Idiot thiefs, and the ones now are a bunch of idiots and well they havent got the time to put their hands on the money so we dont know, but for sure they are not very clever.Plus they seem to be all in bed togather.
Iceland’s foreign debts cannot be paid in kronur; if all the value in things in Iceland were somehow converted into kronur, that would still not cover the total debt, and if payment were begun, the kronur would drop like a molten rock against other currencies. National bankruptcy lies ahead, and all the maneuvering and dithering we see by the government is merely flailing about to avoid the inevitable.
Whisky in hand and just dropping by for a late night browse …
Vilhjalm: you are quite right in all respects except one. The international financiers don’t need to drive around picking what to own – they own everything already.
Easy: you too are talking sense. It’s good to see.
And what a shambles in the Althingi. I was reminded of the English parliament in 1653 after the civil war. They had failed to agree a new constitution. Cromwell lost patience and declared:
“You have sat too long for any good you have been doing lately … Depart, I say; and let us have done with you. In the name of God, go!”
Soldiers cleared the chamber. If only the police could have walked into Althingi and thrown the lot out. And now you’re going to vote for these same clowns – none of them have shown any real interest in solving the problems of the country. (I make no distinction with regard to the parties.) Surely you should have a mass campaign of “electoral abstention”. Everyone should write on their ballot sheet “Ekkert af thessu” (Eng trans: None of these.) If 80% of the population did that it would be the sign to start again – let Forseti ORG declare such a result a “void election” and convene a “national convention” (and don’t forget the guillotine!). Go on, you’ve got a week to do it!
On Monday there were no foreign exchange trades involving the ISK. That has to be some sort of record, I’ve never seen that before. That means no trade at all – nothing out (to pay off the debt) and nothing in (to feed the population).
Did you see the speech by the Norwegian Sedlabanki governor? It was very good. Someone in Sedlabankinn writes very good English – measured, calm, understated, and wonderfully phrased. I guess he or she went to a very good English university. And this speech was typical of speeches by Central Bankers – they say what they mean by using generalisations or abstractions, avoiding specifics. You need to read between the lines. Here are some of the things he said and what they really mean:
He said
“All efforts should be made to avoid further socialisation of private sector debt”
Which means
“If you think that the Central Bank and Government are going to help you Icelanders pay back, reschedule or even write off, your mortgages, indexed car loans or corporate debts … well you can forget it! We’ve got enough on our plate already with depositor guarantee schemes and ISK bonds due.”
He said
“The negotiation processes in the financial sector and the restructuring and recapitalisation of the banks must therefore be pursued according to plan.”
Which means
“Plan!! Plan? We’re just blundering along being told what to do. As for restructuring the banks it looks as if they will need to come to terms with their creditors. Who cares about the division between “new” and “old” banks? Our foreign bondholders certainly don’t. Let’s hope for the best!”
He said
“As part of this, the foreign exchange exposure and indexed loan exposure of the new banks must be addressed.”
Which means
“I have no idea how the banks are going to pay back their debts, especially those that need to be paid back in foreign currencies! But hell, it’s not my problem – it’s the banks!”
He said
“With declining domestic demand, there will be resources available to service the country’s accumulated debt.”
Which means
“All income from our productive output will be used to pay our foreigner creditors. So frankly we’re not going to have anything to spend on ourselves. Domestic demand? Don’t make me laugh! Bread and water if you’re lucky!”
He said
“The Central Bank also reviews selected measures that may allow the most impatient investors locked in by the capital controls to convert their holdings of ISK, in a way that does maintain the currency reserves of the Bank.”
Which means
“Impatient investors? Why are they impatient? Because their bonds have matured and they want their money back – NOW! If we did pay them it would wipe out our currency reserves. Does anyone have any ideas?”
He said
“Negotiations for bilateral loans, other negotiation processes, and the IMF review
should be completed shortly.”
Which means
”The IMF et al are holding back the latest tranche. We need money. We’re descending into poverty. HELP!”
@ Ella you wrote
”I’m disappointed, however, that the administration is willing to hop into bed with them and continue to run Iceland like it’s a Third World Country”
*****************************************
why do you look down at other countries and tag them as ‘third world country’?? …most of those countries you look down on have currencies that are stronger / have more value compared to the useless Icelander kroner e.g South Africa, Nigeria,
Tunisia etcetra.
You need to stop all that your good for nothing Icelandic Pride, look at other countries with some degree of respect; or just shut your tracks, because you’ll make more sense by shutting the heck up.
Ella that was most shameless troll. Not as bad as Walter, but it does ignore simple facts that much this debt come from fact that EU memberstate force Iceland take loans to pay for IceSave deposits early on. (UK and Holland.)
That not same as monies from IMF that Easy says is spent. Well IMF money is mostly not spent.
Some would say that were nice of UK and Holland but it was out pure self interest. Which fine. But let’s not forget that.
As to EU and Euro– Iceland can take what currency it want if it can get people to convert Krona into it. And then we do same as Montenegro and Kosovo.
But it clear that to benefit from the productive power of Germany driving value of Euro, have to be part of EMU machinery. EMU2/ECU2 currentcy peg at least.
But — do really think that ECB and other memberstate will follow rules without unfairness?
Recent history indicate otherwise:
https://www.icenews.is/index.php/2009/02/06/the-banking-crisis-in-iceland-in-2008/
How dumb can a nation be? now we are getting into another political conflict but this time with the European Union, now Sjálfstæðisflokkurinn is agresssively acuseing the EU of interfeering with Iceland´s voting just because they try to use a lie for their campaign saying that they would look to take the Euro in coordination with the IMF, and the EU WHEN ASKED abot it they said that it was not possible, can we accuse somebody of interfeering with our country just because he is asked(they didnt even came up with a press release or anything they were asked)about something that a political party is useing as a campaign? what were they specting the EU to say? “yes, whatever they say is ok” where they spacting that? and now they are openly accuseing the EU of interfeering with iceland´s voting, like we need more problems with european countries. Like Gus says this unfounded superiority complex of us is just stupid, Iceland is not in a possition to create itself conflicts with other nations, who do this peole think we are Germany, USA, France, those countries are powrfull and might getaway with things like this, but wake up this is Iceland, the latest example of what we are in the international view is what England just did few months ago, wake up!!! doesnt mean we are gona let everybody walk over us but pleas we have to be wise, by the way we might not have other option that letting everybody walk over Iceland.
OYSTEIN SAID: “MF says today – tuesday – that the total losses in financial istitutions in the world is estimatet to $ 4054 000 000 000 – of which Europe represent $ 1 193 000 000 000. The losses is about twice as much as estimated in January.”
OYSTEN, ARE YOU SURE YOU ARE POSTING FOR THE RIGHT ARTICLE? WHAT DO YOU MEAN BY THAT YOU SAID??
YES THOSE ARE THE LOSSES, BUT YET, HOW MUCH MONEY DO EUROPE ( AND SPECIALLY THE COUNTRIES IN THE EU ) HAVE??
IT DOES NOT MATTER HOW MUCH YOU LOOSE BUT WHAT YOU HAVE LEFT. EU HAS A LOT LEFT TO GO… BUT ICELAND?? ICELAND HAS NOTHING !!
THE COUNTRY IS TOTALLY RUINED.
Iceland’s recovery plan agreed with the IMF slipped by 10 weeks during its first 12 weeks. If that was a business project, the project manager would have been replaced by now. But the project’s sponsor (the IMF) is very understanding and isn’t laying blame. Nice friendly IMF…
IMF says today – tuesday – that the total losses in financial istitutions in the world is estimatet to $ 4054 000 000 000 – of which Europe represent $ 1 193 000 000 000. The losses is about twice as much as estimated in January.
“This is 21th century we live in now not 17th century. That mean there plenty people out there around world who will invsest. If think there is chance in hell of getting profits OUT later”
ICELAND IS NOT EVEN IN THE 17TH CENTURY. IT IS CULTURALLY IN THE 11TH CENTURY. ALWAYS TEACHING IN THE SCHOOL ABOUT THE VIKINGS, THE SAGAS AND ALL THE STUFF… YOUR VIKING HERITAGE.. ( A VISION OF HISTORY THAT MAKES NO PLACE FOR HOW THEY MIXED WITH IRISH, FRENCH AND BASQUE FISHERMEN, II WW SOLDIERS, ETC…)
KAMON´THERE IS A BIG GAP BETWEEN YOUR ECONOMIC PLANS IN THE XXI CENTURY AND THE CULTURAL FUNDAMENTS OF YOUR SOCIETY…
YOU HAVE BEEN DRIVING MODERN CARS, USING INTERNET AND LAPTOPS… BUT GET READY TO RIDE HORSES AGAIN TO GO TO WORK… THAT WOULD FIT ICELANDERS “MODERN” MENTALITY…
FISY, HOW DO YOU THINK A CURRENCY THAT IS PROBABLY WORTH 1000 ISK AGAINST 1 EURO HAS BEEN ARTIFICIALLY MAINTAINED AT +/- 165ISK PER EURO??
A. BURNING FOREIGN CASH ( IFM LOAN AND OTHER LOANS)
B. BURNING FOREIGN CASH ( IFM LOAN AND OTHER LOANS)
C. BURNING FOREIGN CASH ( IFM LOAN AND OTHER LOANS)
WHAT IS THE RIGHT ANSWER ? IS IT A, B OR C ?
I think the Greens and the Soc.Dems understand the money game a lot better than the capitalists who drove the country into the ground. I’m disappointed, however, that the administration is willing to hop into bed with them and continue to run Iceland like it’s a Third World Country. Lie down with dogs and you wake up with flies. IMF has just issued a veiled threat against Iceland, and Icelanders should kick them out of the country. Fleas and all.
(Yes, Walter, I agree. We like to brag about how well educated and read we are, but it looks like bragging is the only thing we’re good at.)
ROZWADOSKI, ( WELL WRITTEN NOW) IS A POLISH SURNAME, AND NO DOUBT THAT HE IS OF JEWISH HERITAGE… GO FIGURE!
THIS COUNTRY WILL NOT RECEIVE HELP AS LONG AS THEY MAINTAIN THEIR IDEAS OF RACIAL AND CULTURAL SUPERIORITY.
WE HAVEN´T FORGET WHAT WAS DONE TO US IN GERMANY. AND WE HAVEN´T FORGOT THAT ICELAND WAS ACTIVELY DENYING REFUGE TO THOUSANDS OF JEWISH, WHAT IS WORSE, THEY FORCED JEWISH TO GET OUT OF THE COUNTRY…
WHAT GOES AROUND COMES AROUND !
THERE IS A STRONG CULTURE OF SUPERIORITY IN THIS COUNTRY, A CULTURE THAT DEFENDS THE UNIQUENESS OF THE “VIKING” HERITAGE.. THAT IS IN MANY WAYS VERY SIMILAR TO THE THEORETICAL FUNDAMENTS OF THE RACIAL CLEANING MADE BY THE NAZIS IN GERMANY…
THIS COUNTRY NEEDS TO CHANGE, NOT ONLY POLITICALLY, BUT SOCIALLY AS WELL…
I HOPE ROZWADOWSKI DON´T GIVE ANY MONEY TO THIS COUNTRY IF THEY CHOOSE TO HAVE A GOBERN THAT DEFEND SUCH IDEAS OF SUPERIORITY…
ROWSWADOZKI?? HUMMMM THAT IS A POLISH NAME, MABY HE HAS ALSO NOTICED THE WAY FOREIGNERS ARE TREATED IN THIS COUNTRY ( SPECIALLY THE POLISH) AND HE IS NOT HAPPY AT ALL ABOUT IT…
I TOLD YOU, THE WAY ICELANDERS TREAT OTHER PEOPLE IS OF COURSE GOING TO SHAPE THE WAY OTHER NATIONS WILL HELP ( OR NOT) THIS COUNTRY. BECAUSE ITS ECONOMIC MODEL, POLITICAL SYSTEM AND, WHAT IS WORS, SOCIAL STRUCTURE, LACKS OF HUMAN SENSE.
I THINK THEY WANT TO FORCE ICELANDERS TO EAT THEIR OWN SUPERIORITY CRAP…
I TOLD YOU ALL, WITH THE DISRESPECTFUL WAY ICELAND IS TREATING THE WORLD, THEY ARE WINNING ENEMIES, NOT FRIENDS…
GO FIGURE!
@Walter
Hey this is not an English school, so if you want proper English and spelling, go to the English departmet blog of any university and you´ll be very happy, people here are trying to express their thoughts not to display their degree on the English language, so you can write English perfectly but if you don´t contribute with the TOPIC nobody cares about what you say “SHAKESPEARE”. In other words…..
Walter are you by any chance trying to redirect course of this posting thread off topic?
Be happy at least that we are here are not posting in ALL CAPS.
Feel free join the discussion but keep on topic. Which is actions of this worse than useless politicians.
Be quick to criticise the government or “gobermet” / “gubment” but who on this blog bothers to write basic English correctly or even use the English spell checker. Please folks, school kids in most countries could do better.
What a shameful advertisement for banana Iceland.
>The foreign creditors are angry about the currency controls and want them removed.
No kidding. Gylfi Magnússon only basically qualified and non-crazy appointee of Red-Green emeregency govnerment agrees and says so but especially not more stricter ones.
http://mbl.is/mm/vidskipti/frettir/2009/03/27/snidganga_gjaldeyrishoftin/
In next days geniuses led by Steingrímur ++tighten++ currency controls.
https://www.icenews.is/index.php/2009/04/01/icelandic-currency-control-laws-clarified/
Green-Reds do not understand economics. They do not understand how wealth created. They understand how run printing presses of money. And they understand raising taxes. But that is not same thing.
Country dead without foreign investers bring in capital to mix with expertise and resource within country which are abundant.
This is 21th century we live in now not 17th century. That mean there plenty people out there around world who will invsest. If think there is chance in hell of getting profits OUT later.
>By the way the money HAS been used.
Where is factual backup how much has been spent? And on what.
I heard you say this before with no facts behind. Maybe they are there — sourse please.
“The delay in the payment comes.. as well as from the political uncertainty after the resignation of the previous government.”
““The work has taken longer than expected, among other areas, in the restructuring of the banking system. It made a huge difference that there was a change of government earlier in the year. While that was going on, the work almost stopped altogether,”
No sh*t sherlock as saying goes. Of course this is big issue because IMF loaning coutry want to know like foreign investors if get these crazies from Left-Green and this hard left faction of Social Democrat in power after this premature expensive election.. which bought about because of opportunist in Social Democrat breaking coaltion with Independence Party.
Jóhanna and that idiot appointment of century, Steingrímur as Minister Finance have ignored what is important to reconstruction of coutnry economy and instead concentreate time on removing “the crook” Davið and banning lap dancing, and couple other things.
This reflects on they exact same Social Democrat faction beahvior in coalition with Independence Party 2007-2009 they concentrate on pet project to do with they hardleft politicial believes ( at least that what Jóhanna faction and colleague now clinging around her ) is all about..
https://www.icenews.is/index.php/2009/04/14/majority-want-to-ban-striptease/#comment-72277
” the IMF and Icelandic financial plan has been delayed by a minimum of two-and-a-half months compared to the original schedule.”
This bad bad message being sent for foreign investors looking tocome in. It not a vote of confidence. Conspiracy theoryist say it t do with economic hitman. Maybe but I think not so.
It is because IMF loaning coutry want to know money will not be piss away against wall by incoming government.
But dont worry you not like Red Green just go out on street and protest for a week or three and then you get one of coaliition party back and elections again. Like Italy..
No, these Left Green and Social Democrat will not listen. They will hang onto power as they can. They will pass law centralizing power. They will do what hard left politicans do. Use state power for their ends. To tell people what to do what to think– and to raise tax to pay for enforcement of it.
“Rozwadowski says that the IMF and the new government will need to sit down together after this Saturday’s elections and rework some details of the deal to help achieve the goals which were originally set.”
Like not more nationalising things. Not more taxe rise. ie ++suicioda things++ that come from unrestreained Green-Red coalition govermnent that pollster so hot to predict.
They present all this statements as IMF statements but in fact is a IMF declaration with mbl.is assumptions mixed. By the way they have stop useing the IMF term and now they use the Icelandic AGS, unless off course is something possitive about the IMF they use IMF.
In other words: “If the new gobermet behaves you´ll see some more money” Like I told you long time ago, no more money to Iceland untill we see some progress. If you notice they use Rozwadozki words mixed with MBL.IS statements.
“The work has taken longer than expected, among other areas, in the restructuring of the banking system. It made a huge difference that there was a change of government earlier in the year. While that was going on, the work almost stopped altogether,” Rozwadowski told Morgunbladid.
“That money has barely been used as yet; and the recovery plan between the IMF and the Icelandic government does not anticipate a need to use money from the Fund directly to pay off liabilities, mbl.is reports”.
By the way the money HAS been used.
The “goals” the IMF wants are the complete surrender of all assets to the foreign creditors, who are they fooling with this talk of technical problems. And they want it soon, no delays. No agreement with the creditors = no more loans.
And now it looks like the EU wants to kick Iceland out of EES (EFTA), according to Eirikur Bergmann (“Segir hættu á að Íslandi verði sparkað út úr EES”). The foreign creditors are angry about the currency controls and want them removed.
If that happens Iceland really will be like Cuba. Or maybe Somalia.
„Sem myndi auðvitað hafa margvíslegar afleiðingar, til að mynda yrðu tollar væntanlega lagðir á ný á íslenskar sjávarafurðir inn á markaði ESB, vörur frá Íslandi fá þá ekki lengur sjálfkrafa vottun inn á Evrópumarkað með ómældu óhagræði, fjárfestingaréttur hyrfi og réttur Íslendinga til að starfa í Evrópu yrði afturkallaður. Enn fremur yrði lokað fyrir þátttöku Íslendinga í samstarfsáætlunum ESB á svið vísinda-, mennta- og menningarmála sem hafa fært gríðarlega þekkingu og fjármagn inn í íslenskt samfélag,”
Higher tolls on fish, Icelandic goods (what goods?) no longer travel freely in EU, investments (what investments? disappear, no rights to work in Europe, etc.
There was a news article yesterday about how the gubment was considering giving a power plant / aluminum works (and the income stream) to the foreign bondholders, so maybe that is part of the IMF’s “goals” for Iceland. Probably the foreign bondholders and Deutsche Bank accountants are driving around Iceland looking for stuff they want.