QuoteIceland plans vote on bank payout
Iceland's president has announced plans to hold a referendum on the payment of compensation resulting from the collapse of the country's banks.
President Olafur Ragnar Grimsson said he would not sign a controversial bill to repay $5bn lost by UK and Dutch savers in Icesave accounts.
The government has seen strong domestic opposition to the bill.
The Landsbanki bank, which ran the Icesave accounts, collapsed at the height of the banking crisis in 2008.
The money would have gone to the UK and Dutch governments who compensated Icesave holders following the collapse.
The bill gained parliamentary approval in December, but public opposition in Iceland has grown.
On Saturday, the president received a petition against it that had been signed by a quarter of the country's population.
Announcing the decision to hold a referendum on the bill, President Grimmson said that the Icelandic public had the right to choose.
"It is the job of the president of Iceland to make sure the nation's will is answered," he said.
"I have decided... to take the new law to the nation. The referendum will take place as quickly as possible."
BBC Europe business reporter Nigel Cassidy said it was an astonishing decision.
"It really plunges Iceland into a constitutional crisis," he said.
He pointed out that Iceland is having to borrow the $5bn needed for the compensation.
"They don't have the money," he said.
"They are having to borrow it from the IMF to shore up not just this loan but all kinds of other things, so it puts everything up in the air - not just this but further loans from the IMF and even Iceland's chances of joining the European Union."
http://news.bbc.co.uk/1/hi/business/8441312.stm (http://news.bbc.co.uk/1/hi/business/8441312.stm)
I think it would be a bad mistake if they vote to default.
Danegeld 2010. :lol:
Quote from: Richard Hakluyt on January 05, 2010, 07:19:20 AM
I think it would be a bad mistake if they vote to default.
Yes. Their mistake lies with entrusting The People to make decisions of this nature. :bleeding:
I am sure the major nations that Iceland would piss off by doing this would never retaliate, so why not?
Is Iceland somehow legally responsible for these accounts?
Quote from: Richard Hakluyt on January 05, 2010, 07:19:20 AM
I think it would be a bad mistake if they vote to default.
(https://languish.org/forums/proxy.php?request=http%3A%2F%2Fwww.royalnavy.mod.uk%2Fupload%2Fimg_400%2FHMS_Ark_Royal_0053_0015.jpg&hash=137c6f13fe152386c3ce1823055e4d9a336b0e7e)
Quote from: Neil on January 05, 2010, 09:35:00 AM
Is Iceland somehow legally responsible for these accounts?
Its a bit of muddle. The answer is probably not although it takes a rather crabbed reading of Iceland's treaty commitments to get there.
Quote from: The Minsky Moment on January 05, 2010, 09:53:17 AM
Quote from: Neil on January 05, 2010, 09:35:00 AM
Is Iceland somehow legally responsible for these accounts?
Its a bit of muddle. The answer is probably not although it takes a rather crabbed reading of Iceland's treaty commitments to get there.
But it does raise the question why Britain and Holland should support Iceland's entry into the EU.
Quote from: HisMajestyBOB on January 05, 2010, 09:36:06 AM
Quote from: Richard Hakluyt on January 05, 2010, 07:19:20 AM
I think it would be a bad mistake if they vote to default.
(https://languish.org/forums/proxy.php?request=http%3A%2F%2Fwww.royalnavy.mod.uk%2Fupload%2Fimg_400%2FHMS_Ark_Royal_0053_0015.jpg&hash=137c6f13fe152386c3ce1823055e4d9a336b0e7e)
Iceland is defended by the US Armed Forces.
Quote from: Neil on January 05, 2010, 09:35:00 AM
Is Iceland somehow legally responsible for these accounts?
Under the European Economic Area rules there must be a state backed guarantee of about 20k Euro per customer if you operate a bank in another country. Iceland's banks operated under these rules so Iceland is liable for these losses. Or at least that's the stance of those countries that have suffered the losses. ;) Iceland probably has a different opinion on that.
Quote from: Grey Fox on January 05, 2010, 10:04:44 AM
Quote from: HisMajestyBOB on January 05, 2010, 09:36:06 AM
Quote from: Richard Hakluyt on January 05, 2010, 07:19:20 AM
I think it would be a bad mistake if they vote to default.
(https://languish.org/forums/proxy.php?request=http%3A%2F%2Fwww.royalnavy.mod.uk%2Fupload%2Fimg_400%2FHMS_Ark_Royal_0053_0015.jpg&hash=137c6f13fe152386c3ce1823055e4d9a336b0e7e)
Iceland is defended by the US Armed Forces.
I was thinking of Iceland's credit rating rather than an invasion to seize their vast stocks of fishfingers ;)
That's too bad, whatever happened to the once proud martial spirit of British sea power?
Britain has gone from sea power to C power. :(
Viking's been quiet. Think he's getting tooled up to repel international armed debt collectors?
I can understand the Icelanders though... they're basically asked -if not coerced- to cough up 13k euros per person to help some people who put their money on icelandic banks because they wanted that half-percentage more. People don't like greedy persons.
Quote from: Brazen on January 05, 2010, 12:12:42 PM
Viking's been quiet. Think he's getting tooled up to repel international armed debt collectors?
I get to sleep right?
This has been brewing for a few weeks now. The Allthing debated this and passed a law to guarantee the deposits in the Icelandic banks, regardless of origin of depositor. There were many reasons for doing this good and bad, but it was done. Passing this law had many consequences many good, many bad, but on balance it was more good than bad. Now many Icelanders seem to think that they can renege on an agreement and keep the good consequences to avoid the bad consequences.
We got a very very good deal. The law that is being discussed is not really the document that forces us to pay (we have real laws for that) but rather the payment plan that only makes us pay if we can afford it. I'm not sure how much will there is in Britain and the Netherlands to actually pursue this, but then again France vetoed British EEC membership for less valid reasons. We don't like greedy people, but we let these people (the Bankers) get away with fraud. The President (who is trying to refuse to sign this) actually went to meetings for IceSave in London giving his personal guarantee of solidity. So I think we should not look a gift horse in the mouth say thanks and plead poverty 10 years hence when we are actually in the EU and ask that the UK and Dutch contributions be increased to pay Iceland so Iceland can pay it's debt.
Quote from: Crazy_Ivan80 on January 05, 2010, 01:31:26 PM
I can understand the Icelanders though... they're basically asked -if not coerced- to cough up 13k euros per person to help some people who put their money on icelandic banks because they wanted that half-percentage more. People don't like greedy persons.
The Greedy ones would be the Icelandic bankers who decided they could take people's money and breach laws guaranteeing deposits, no?
Quote from: Zanza on January 05, 2010, 11:04:37 AM
Quote from: Neil on January 05, 2010, 09:35:00 AM
Is Iceland somehow legally responsible for these accounts?
Under the European Economic Area rules there must be a state backed guarantee of about 20k Euro per customer if you operate a bank in another country. Iceland's banks operated under these rules so Iceland is liable for these losses. Or at least that's the stance of those countries that have suffered the losses. ;) Iceland probably has a different opinion on that.
Well, basically the Law the President might refuse to sign agrees to the liability and fixes the payment to icelandic economic growth. In return the UK and the Netherlands have agreed to not block Icelandic EU membership (which is probably the most important part of our recovery).
Quote from: Faeelin on January 05, 2010, 01:46:38 PM
Quote from: Crazy_Ivan80 on January 05, 2010, 01:31:26 PM
I can understand the Icelanders though... they're basically asked -if not coerced- to cough up 13k euros per person to help some people who put their money on icelandic banks because they wanted that half-percentage more. People don't like greedy persons.
The Greedy ones would be the Icelandic bankers who decided they could take people's money and breach laws guaranteeing deposits, no?
they're also greedy, but that doesn't really absolve the people of their actions. Especially if you know that the warning lights about iceland were on at least 6 months before the shit hit the fan (I remember reading about the precarious banking situation in Iceland early 2008 in, iirc, the economist). If people don't inform themselves about this (while they're apparently savvy enough to inform themselves about the fact that there's more interest to be earned in Iceland) then they cannot claim to be innocent.
We've got a name for that kind of people: "geldzak nooit vol" (literally: the moneybag is never full)
Iceland = Third World
Quote from: Faeelin on January 05, 2010, 01:46:38 PM
The Greedy ones would be the Icelandic bankers who decided they could take people's money and breach laws guaranteeing deposits, no?
How did the bankers breach laws about *governmental* guarantee of deposits?
Quote from: Crazy_Ivan80 on January 05, 2010, 01:56:55 PM
they're also greedy, but that doesn't really absolve the people of their actions. Especially if you know that the warning lights about iceland were on at least 6 months before the shit hit the fan (I remember reading about the precarious banking situation in Iceland early 2008 in, iirc, the economist). If people don't inform themselves about this (while they're apparently savvy enough to inform themselves about the fact that there's more interest to be earned in Iceland) then they cannot claim to be innocent.
Ok but the Iceland government has already paid out all the domestic account holders who were just as greedy while refusing equal treatment for overseas account holders. Even if this can be squared with the literal language of the EEC treaty's non-discrimination provisions, there is a certain stink about it.
Quote from: Admiral Yi on January 05, 2010, 02:00:02 PM
Quote from: Faeelin on January 05, 2010, 01:46:38 PM
The Greedy ones would be the Icelandic bankers who decided they could take people's money and breach laws guaranteeing deposits, no?
How did the bankers breach laws about *governmental* guarantee of deposits?
If we're going to call people who invest for an extra half a percent greedy, why shouldn't we call bankers who knew they couldn't repay their deposits greedy?
People are greedy, but seeking out a decent interest rate in a sound bank is hardly the most egregious display of that greed :huh:
I looked at those banks myself but instead went for a Dutch savings bank, on the basis that the deposit guarantee was more sound as it was backed by a larger economy.
People thought that banking with an Icelandic bank was much the same as choosing a Swiss or Dutch bank; the really greedy ones probably went for a Nigerian savings bank :P
Quote from: Faeelin on January 05, 2010, 02:15:05 PM
If we're going to call people who invest for an extra half a percent greedy, why shouldn't we call bankers who knew they couldn't repay their deposits greedy?
Why can't you admit you were wrong about deposit guarantees?
Quote from: Richard Hakluyt on January 05, 2010, 02:27:16 PM
People are greedy, but seeking out a decent interest rate in a sound bank is hardly the most egregious display of that greed :huh:
continuing to stick around when people in the know are warning of the dangers of staying around is. That or stupidity. Better to be called greedy rather than stupid then I guess
Quote from: The Minsky Moment on January 05, 2010, 02:03:05 PM
Quote from: Crazy_Ivan80 on January 05, 2010, 01:56:55 PM
they're also greedy, but that doesn't really absolve the people of their actions. Especially if you know that the warning lights about iceland were on at least 6 months before the shit hit the fan (I remember reading about the precarious banking situation in Iceland early 2008 in, iirc, the economist). If people don't inform themselves about this (while they're apparently savvy enough to inform themselves about the fact that there's more interest to be earned in Iceland) then they cannot claim to be innocent.
Ok but the Iceland government has already paid out all the domestic account holders who were just as greedy while refusing equal treatment for overseas account holders. Even if this can be squared with the literal language of the EEC treaty's non-discrimination provisions, there is a certain stink about it.
being a citizen of a place doesn't equal being not a citizen of a place.
Quote from: Crazy_Ivan80 on January 05, 2010, 02:39:55 PM
Quote from: Richard Hakluyt on January 05, 2010, 02:27:16 PM
People are greedy, but seeking out a decent interest rate in a sound bank is hardly the most egregious display of that greed :huh:
continuing to stick around when people in the know are warning of the dangers of staying around is. That or stupidity. Better to be called greedy rather than stupid then I guess
Wasn't there a government guarantee?
Quote from: Crazy_Ivan80 on January 05, 2010, 02:39:55 PM
Quote from: Richard Hakluyt on January 05, 2010, 02:27:16 PM
People are greedy, but seeking out a decent interest rate in a sound bank is hardly the most egregious display of that greed :huh:
continuing to stick around when people in the know are warning of the dangers of staying around is. That or stupidity. Better to be called greedy rather than stupid then I guess
German tabloid BILD still recommended investing with a certain Icelandic bank a week or two before it folded. Not saying that they aren't stupid.
Quote from: Admiral Yi on January 05, 2010, 02:31:01 PM
Quote from: Faeelin on January 05, 2010, 02:15:05 PM
If we're going to call people who invest for an extra half a percent greedy, why shouldn't we call bankers who knew they couldn't repay their deposits greedy?
Why can't you admit you were wrong about deposit guarantees?
I admit I was wrong?
Feel better? :huh:
Quote from: Crazy_Ivan80 on January 05, 2010, 02:40:45 PM
being a citizen of a place doesn't equal being not a citizen of a place.
Hence the need of putting a non-discrimination clause into an inter-governmental accord.
Quote from: The Brain on January 05, 2010, 02:41:39 PM
Quote from: Crazy_Ivan80 on January 05, 2010, 02:39:55 PM
Quote from: Richard Hakluyt on January 05, 2010, 02:27:16 PM
People are greedy, but seeking out a decent interest rate in a sound bank is hardly the most egregious display of that greed :huh:
continuing to stick around when people in the know are warning of the dangers of staying around is. That or stupidity. Better to be called greedy rather than stupid then I guess
Wasn't there a government guarantee?
and you believe everything people -especially those in power- say?
that said, and I do want to make this clear, my responsses are how I would feel if I were such an Icelander, or if it was me who have to pay the equivalent of 13K euros to some stranger.
Iceland must of course do what's best for the country but what that is... Well, let's say that there are countries who do far worse things and don't get treated any differently for it.
Quote from: Crazy_Ivan80 on January 05, 2010, 02:39:55 PM
continuing to stick around when people in the know are warning of the dangers of staying around is. That or stupidity. Better to be called greedy rather than stupid then I guess
I guess it is stupid for
them not to know
then what
you know
now, but frankly you were stupid as well, because you didn't know then, either.
The fact is that the Icelandic finance minister assured depositors that Iceland's government would protect against a failure a mere two days before the failure.
Quote from: Admiral Yi on January 05, 2010, 02:00:02 PM
Quote from: Faeelin on January 05, 2010, 01:46:38 PM
The Greedy ones would be the Icelandic bankers who decided they could take people's money and breach laws guaranteeing deposits, no?
How did the bankers breach laws about *governmental* guarantee of deposits?
To the best of my knowledge they did not. Banks are bound by law (iirc) to keep some percent of their liabilities on hand. Laws all over the world (not just iceland) have for a long time been lowering that level, the banks have been lobbying for it. This extra cash has then been invested in various project of variable liquidity.
The Icelandic bankers were simply more aggressive in leveraging their deposits than others. Now our problem was that ALL our banks did that. Every bank from the farmers coop bank to the marble plated Bank of Iceland were trying to turn themselves into investment banks at the behest and to the benefit of their owners (the farmers, workers and fishermans coop banks were all privatised and merged). The two great creditors (the UK and The Netherlands) both had banking failures in the same period. The difference is that the 60M Britishers and the 20M Dutch could find the cash to prop up the bank that failed. The 300K Icelanders had to not only prop up all the local banks but also some rather large foreign ones as well.
To the best of my knowledge these "crazy" banks never lost money. They were just leveraged up to the hilt and reliant on cheap, quick and easy credit to stay liquid. When the credit stopped, they were left with non-liquid assets they couldn't sell (at a decent price) to pay their short term debts.
I say we nuke them from orbit, just to be sure.
Quote from: The Brain on January 05, 2010, 01:58:32 PM
Iceland = Third World
low income, single export, all infrastructure in one spot, corrupt politicians, yepp.. that sounds like a third world country
Quote from: Viking on January 05, 2010, 03:14:47 PM
The two great creditors (the UK and The Netherlands) both had banking failures in the same period. The difference is that the 60M Britishers and the 20M Dutch could find the cash to prop up the bank that failed. The 300K Icelanders had to not only prop up all the local banks but also some rather large foreign ones as well.
Which kind of raises the obvious questions about the wisdom of Iceland to keep out of the EU.
Quote from: katmai on January 05, 2010, 03:15:11 PM
I say we nuke them from orbit, just to be sure.
yeah yeah, turn our country into a wasteland racked by a nuclear winter will you.. that would probably be an improvement.
Quote from: Viking on January 05, 2010, 03:21:45 PM
Quote from: katmai on January 05, 2010, 03:15:11 PM
I say we nuke them from orbit, just to be sure.
yeah yeah, turn our country into a wasteland racked by a nuclear winter will you.. that would probably be an improvement.
Doesn't sound like anything would change to be honest.
Quote from: The Minsky Moment on January 05, 2010, 03:20:52 PM
Quote from: Viking on January 05, 2010, 03:14:47 PM
The two great creditors (the UK and The Netherlands) both had banking failures in the same period. The difference is that the 60M Britishers and the 20M Dutch could find the cash to prop up the bank that failed. The 300K Icelanders had to not only prop up all the local banks but also some rather large foreign ones as well.
Which kind of raises the obvious questions about the wisdom of Iceland to keep out of the EU.
We have already applied, for precisely that reason. Personally I think we just want to get in before we have to default, so the EU can bail us out properly.
I'd rather have Turkey in the EU than Iceland. :x
JUST KIDDING LOL
Quote from: The Brain on January 05, 2010, 03:28:56 PM
I'd rather have Turkey in the EU than Iceland. :x
JUST KIDDING LOL
damn it you almost got me there... :mad:
Quote from: The Brain on January 05, 2010, 03:28:56 PM
I'd rather have Turkey in the EU than Iceland. :x
JUST KIDDING LOL
If Iceland aren't going to pay back the money I'd agree with that.
But then I support Turkey in the EU anyway.
I wonder what will happen, this is a huge cassus beli, a big FU from Iceland but of course these things aren't followed up on between first world democracies so...hmm
Quote from: Tyr on January 05, 2010, 04:02:32 PM
Quote from: The Brain on January 05, 2010, 03:28:56 PM
I'd rather have Turkey in the EU than Iceland. :x
JUST KIDDING LOL
If Iceland aren't going to pay back the money I'd agree with that.
But then I support Turkey in the EU anyway.
I wonder what will happen, this is a huge cassus beli, a big FU from Iceland but of course these things aren't followed up on between first world democracies so...hmm
meh.. the RN isn't quite what it was during the cod wars...
Quote from: The Brain on January 05, 2010, 03:28:56 PM
I'd rather have Turkey in the EU than Iceland. :x
Agreed. I care more about Kerry Katona than Kurds <_<
The RN would bend over to the first Icelandic trawler captain with a big beard :huh:
Quote from: Sheilbh on January 05, 2010, 04:16:01 PM
Quote from: The Brain on January 05, 2010, 03:28:56 PM
I'd rather have Turkey in the EU than Iceland. :x
Agreed. I care more about Kerry Katona than Kurds <_<
Trying to figure out what 1/4 hungarian Kerry Katona had to do with Iceland I guessed she sponsored the frozen food chain one of our banks used to own. So I googled "Iceland Food" and found this (http://en.wikipedia.org/wiki/Icelandic_cuisine)
pickled rams testicles, rotten shark and blowtorched puffin