Iceland Declares Independence from International Banks

[aonascimento]

Coincidence or not, i´ve just posted a documentary that talks about, inicially, how Iceland was strong, and stable in it´s financial system and how international bankers messed it all. Very good documentary for a whole bankruptcy perspective, specially in north america, as well as how they don´t mind with consequences.

http://vimeo.com/25142692

[aonascimento]

Posted by Muzz (here)
Some good background on this story.

Inside Job

Didn´t see your post.. lol

Well, does worth one more reference to this documentary.

[Ilie Pandia]

Excellent (and scary) movie Muzz... thanks! I highly recommend it!

[Christine Breese]

Iceland was the first to throw all the bankers in jail, that's cool!

[Murray]

Iceland speeds up bank asset sale to repay Britain £2.3bn

celand plans to speed up a sale of retail assets in a bid to repay £2.3 billion to Britain.

The country was provided with £3.4 billion worth of loans by the British and Dutch governments following the collapse of Landsbanki in 2008. The nationalised bank has interests in Iceland frozen food stores, toy store Hamleys and House of Fraser which the government plans to dispose of in order to repay the loans.

read more

[Murray]

Heres a good update on whats happening in Iceland

The Corbett Report

[DNA]

Didn't Libya attempt the same thing?

[Tahi]

Libya (Gaddaffi in MSM news) was wanting to establish an Oil Currency the "Gold Dinar" ...

Was that the reason NATO rescued the Lybian people from the oppressor?

[jackovesk]

Key Lesson From Iceland - "Let The Banks FAIL"..!

November 7, 2011

Agence France-Presse notes:

Three years after Iceland’s banks collapsed and the country teetered on the brink, its economy is recovering, proof that governments should let failing lenders go bust and protect taxpayers, analysts say.

***

“The lesson that could be learned from Iceland’s way of handling its crisis is that it is important to shield taxpayers and government finances from bearing the cost of a financial crisis to the extent possible,” Islandsbanki analyst Jon Bjarki Bentsson told AFP.

“Even if our way of dealing with the crisis was not by choice but due to the inability of the government to support the banks back in 2008 due to their size relative to the economy, this has turned out relatively well for us,” Bentsson said.

***

Nobel Prize-winning US economist Paul Krugman echoed Bentsson.

“Where everyone else bailed out the bankers and made the public pay the price, Iceland let the banks go bust and actually expanded its social safety net,” he wrote in a recent commentary in the New York Times.

“Where everyone else was fixated on trying to placate international investors, Iceland imposed temporary controls on the movement of capital to give itself room to maneuver,” he said.

During a visit to Reykjavik last week, Krugman also said Iceland has the krona to thank for its recovery, warning against the notion that adopting the euro can protect against economic imbalances.

***

Iceland’s former prime minister Geir Haarde, in power during the 2008 meltdown and currently facing trial over his handling of the crisis, has insisted his government did the right thing early on by letting the banks fail and making creditors carry the losses.

“We saved the country from going bankrupt,” Haarde, 68, told AFP in an interview in July.

As I noted last week:

Iceland told the banks to pound sand. And Iceland’s economy is doing much better than virtually all of the countries which have let the banks push them around.

Barry Ritholtz noted in May:

Rather than bailout the banks — Iceland could not have done so even if they wanted to — they guaranteed deposits (the way our FDIC does), and let the normal capitalistic process of failure run its course.

They are now much much better for it than the countries like the US and Ireland who did not.

Bloomberg pointed out in February:

Unlike other nations, including the U.S. and Ireland, which injected billions of dollars of capital into their financial institutions to keep them afloat, Iceland placed its biggest lenders in receivership. It chose not to protect creditors of the country’s banks, whose assets had ballooned to $209 billion, 11 times gross domestic product.

***

“Iceland did the right thing by making sure its payment systems continued to function while creditors, not the taxpayers, shouldered the losses of banks,” says Nobel laureate Joseph Stiglitz, an economics professor at Columbia University in New York. “Ireland’s done all the wrong things, on the other hand. That’s probably the worst model.”

Ireland guaranteed all the liabilities of its banks when they ran into trouble and has been injecting capital — 46 billion euros ($64 billion) so far — to prop them up. That brought the country to the brink of ruin, forcing it to accept a rescue package from the European Union in December.

***

Countries with larger banking systems can follow Iceland’s example, says Adriaan van der Knaap, a managing director at UBS AG.

“It wouldn’t upset the financial system,” says Van der Knaap, who has advised Iceland’s bank resolution committees.

***

Arni Pall Arnason, 44, Iceland’s minister of economic affairs, says the decision to make debt holders share the pain saved the country’s future.

“If we’d guaranteed all the banks’ liabilities, we’d be in the same situation as Ireland,” says Arnason, whose Social Democratic Alliance was a junior coalition partner in the Haarde government.

***

“In the beginning, banks and other financial institutions in Europe were telling us, ‘Never again will we lend to you,’” Einarsdottir says. “Then it was 10 years, then 5. Now they say they might soon be ready to lend again.”

Even the IMF praises Iceland’s strategy:

As the first country to experience the full force of the global economic crisis, Iceland is now held up as an example by some of how to overcome deep economic dislocation without undoing the social fabric.

While the conditions in Iceland are in many ways different from the conditions in the U.S., Iceland’s lesson applies to America, as well.

Specifically, a study of 124 banking crises by the International Monetary Fund found that propping banks which are only pretending to be solvent hurts the economy:

Existing empirical research has shown that providing assistance to banks and their borrowers can be counterproductive, resulting in increased losses to banks, which often abuse forbearance to take unproductive risks at government expense. The typical result of forbearance is a deeper hole in the net worth of banks, crippling tax burdens to finance bank bailouts, and even more severe credit supply contraction and economic decline than would have occurred in the absence of forbearance.

Cross-country analysis to date also shows that accommodative policy measures (such as substantial liquidity support, explicit government guarantee on financial institutions’ liabilities and forbearance from prudential regulations) tend to be fiscally costly and that these particular policies do not necessarily accelerate the speed of economic recovery.

***

All too often, central banks privilege stability over cost in the heat of the containment phase: if so, they may too liberally extend loans to an illiquid bank which is almost certain to prove insolvent anyway. Also, closure of a nonviable bank is often delayed for too long, even when there are clear signs of insolvency (Lindgren, 2003). Since bank closures face many obstacles, there is a tendency to rely instead on blanket government guarantees which, if the government’s fiscal and political position makes them credible, can work albeit at the cost of placing the burden on the budget, typically squeezing future provision of needed public services.

Indeed, numerous Nobel prize winning and otherwise highly-regarded American economists say that our economy cannot recover until the big banks are broken up.

If the politicians are too corrupt to break up the big banks (because the banks have literally bought the politicians), let’s break them up ourselves.

Many people are doing just that. "Credit Unions Poach Clients"

http://www.washingtonsblog.com/2011/...anks-fail.html

[Murray]

Thanks Jack very interesting.

[Murray]

Icelandic Anger Brings Debt Forgiveness in Best Recovery Story
By Omar R. Valdimarsson - Feb 20, 2012 12:01 AM GMT

Icelanders who pelted parliament with rocks in 2009 demanding their leaders and bankers answer for the country’s economic and financial collapse are reaping the benefits of their anger.

Since the end of 2008, the island’s banks have forgiven loans equivalent to 13 percent of gross domestic product, easing the debt burdens of more than a quarter of the population, according to a report published this month by the Icelandic Financial Services Association.

“You could safely say that Iceland holds the world record in household debt relief,” said Lars Christensen, chief emerging markets economist at Danske Bank A/S in Copenhagen. “Iceland followed the textbook example of what is required in a crisis. Any economist would agree with that.”

The island’s steps to resurrect itself since 2008, when its banks defaulted on $85 billion, are proving effective. Iceland’s economy will this year outgrow the euro area and the developed world on average, the Organization for Economic Cooperation and Development estimates. It costs about the same to insure against an Icelandic default as it does to guard against a credit event in Belgium. Most polls now show Icelanders don’t want to join the European Union, where the debt crisis is in its third year. more

[Murray]

Iceland Forgives Mortgage Debt for the Population. Putting Bankers and Politicians on "Bench of Accused"

This is awesome. It shows when the people DO STAND UP they have more power and win against the corrupt bankers and politicians of a country. Iceland is forgiving and erasing the mortgage debt of the population. They are putting the bankers and politicians on the "Bench of the Accused." Which means I assume they are putting them on trial for corruption.

Now the rest of people of the world need to start doing the same thing. We all need to stand up and against all the corruption and fraud of the banks and politicians that are puppets of the banks and corporations. link

Source: http://www.youtube.com/watch?v=uyxzg58JkYI

Go on! This is the sort of thing we need to spread far and wide.
Muzz

[lslimerick]

If you think it, then so be it, glad the icelandic ppl are able to think for themselves, hence create their future, just hope that you doom and gloom (PTB perfect little helpers) have absolutely zero effect on this and THEY will lead the way to this new way of living.....

[Earth Angel]

fricken awesome!!!! yes, lets have all the mortgages of the world erased......that would be a load off!! then again I can just hear those people who have struggled and not taken a holiday for years, bitching about the people with big overwhelming debt getting off ........ this is the part of the forgiveness of debt that I think might backfire.

[modwiz]

Posted by Earth Angel (here)
fricken awesome!!!! yes, lets have all the mortgages of the world erased......that would be a load off!! then again I can just hear those people who have struggled and not taken a holiday for years, bitching about the people with big overwhelming debt getting off ........ this is the part of the forgiveness of debt that I think might backfire.

If it backfired it would only show why the collective is worthy of contempt. Throwing off the yoke and burden of millennia is no time for bean counting and comparing notes. It is a time for celebration and breathing of free air.

Minding to ones own business is a lost art, insidiously ripped apart by a media that has slowly turned people into decadent and envious voyeurs. Those who worked the hardest enabled the overlords the most. Everyone has both plus and minuses in what has been created. Let us leave the past behind us when we finally are given that opportunity. Let us embrace a brighter future.