QuoteIceland to vote on repaying 'debt'
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The so-called "Icesave" deal is deeply unpopular with the Icelandic population [Reuters]
Iceland's economic and political future hangs in the balance as it heads towards a referendum on how to compensate Britain and the Netherlands for money lost in the collapse of an Icelandic bank.
Iceland has made a last-ditch compensation offer to both countries in talks over $5.7bn lost in "Icesave" accounts, ahead of a referendum this weekend which is expected to nullify the current deal.
Ossur Skarphedinsson, the foreign minister, told the Financial Times Deutschland newspaper that Iceland was awaiting British and Dutch replies to the offer.
The measure provides $3.8bn to the UK and $1.9bn to the Netherlands from 2016 to repay expenditures to compensate citizens who lost money in the collapse of Icesave.
The payout has stirred up considerable resentment among many ordinary Icelanders hard hit by their country's financial meltdown in 2008.
Skarphedinsson told the paper the deadline of the referendum meant "we're under high pressure like never before. Those are good conditions for achieving an agreement."
Growing anger
Skarphedinsson said that if Saturday's referendum went ahead a "No" vote was certain and that the negotiations would be further drawn out.
The Icesave deal is deeply unpopular with the Icelandic population and there is widespread feeling that taxpayers are being left to foot the bill for mistakes made by financial firms operating under the watch of other national regulators.
Rejection of the Icesave bill would likely freeze the foreign aid needed to resuscitate Iceland's economy and cloud its prospects of joining the European Union (EU).
Support for accession has been falling in past months and membership now opposed by more than half of Icelanders, nearly twice the level seen just after the 2008 financial crisis in which three of Iceland's leading banks collapsed.
"Attitudes towards EU membership are changing drastically," Gudbjorg Andrea Jonsdottir, a research director at pollster Capacent, said.
"There is a lot of anger over the Icesave saga and, rightly or wrongly, some blame is directed at the EU, which only adds to long-held Icelandic suspicions about Brussels."
EU factor
Skarphedinsson was hopeful Icelanders would accept any cancellation of the referendum should a new deal more favourable to Iceland be struck.
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The payment of the $5.7bn, is equivalent to nearly 40 per cent of the country's GDP [AFP]
But the ballot may be difficult to cancel without support from opposition parties, who are trying to turn the referendum into a vote on the centre-left government.
"If we reach a deal in the short-term, the conditions would be so good that there wouldn't be any great frustrations among the population," Skarphedinsson said.
Britain and the Netherlands have proposed softer terms than those agreed to late last year, but talks broke down last week as Iceland held out for a better deal.
Iceland, however, has little choice but to push for an agreement because Britain and the Netherlands want to settle the Icesave matter before funds from the International Monetary Fund (IMF) can resume and help rebuild its economy.
The measure foresees staggering through to 2024 the payment of the $5.7bn, which is equivalent to nearly 40 per cent of the country's annual gross domestic product.
Johanna Sigurdardottir, the prime minister, has tried to play down the expected rejection of the Icesave bill, which she pushed through parliament at a great political cost but which was rejected by the president, triggering the referendum on March 6.
Icesave was an online subsidiary of Iceland's Landsbanki bank, which had to be rescued in October 2008 as the global credit crunch hit.
It had attracted thousands of savers due to its high interest rates.
So what would happen if Iceland doesn't approve the measure and in turn the IMF does not help Iceland rebuild their economy?
No, if Iceland says no Britain and the Netherlands might get really prissy, but Iceland will have it's but saved by Norway (cheap loan to pay the dutch and british).
Are they rioting?
Hey Viking, just out of curiosity how many non-whites, IE Eskimoos, Asians, Africans et al are there in Iceland? All the pics I've seen from the ones above to the Elf sex videos have not showcased the multiculturalism of your island.
Quote from: Jaron on March 04, 2010, 01:18:04 PM
Hey Viking, just out of curiosity how many non-whites, IE Eskimoos, Asians, Africans et al are there in Iceland? All the pics I've seen from the ones above to the Elf sex videos have not showcased the multiculturalism of your island.
Aside of the trolls and gnomes, none.
Quote from: Jaron on March 04, 2010, 01:18:04 PM
Hey Viking, just out of curiosity how many non-whites, IE Eskimoos, Asians, Africans et al are there in Iceland? All the pics I've seen from the ones above to the Elf sex videos have not showcased the multiculturalism of your island.
A few years ago a paper held a poll asking if there were too many pakistanis in the country. After an overwhelming yes vote the paper revealed that there were 3.
So, no furriners, the poles all went home after the economy tanked. We don't have multiculturalism, we have monoculturalism.
Interesting, thank you.
Quote from: Savonarola on March 04, 2010, 12:32:43 PM
So what would happen if Iceland doesn't approve the measure and in turn the IMF does not help Iceland rebuild their economy?
They would be shut out of international capital markets for 20 to 30 years and they would have to run a trade surplus.
Quote from: Admiral Yi on March 04, 2010, 03:57:26 PM
Quote from: Savonarola on March 04, 2010, 12:32:43 PM
So what would happen if Iceland doesn't approve the measure and in turn the IMF does not help Iceland rebuild their economy?
They would be shut out of international capital markets for 20 to 30 years and they would have to run a trade surplus.
No, Norway bails us out and are insufferably smug for the next 100 years.
Quote from: Viking on March 04, 2010, 04:03:40 PM
No, Norway bails us out and are insufferably smug for the next 100 years.
I don't see how Norway can bail you out on a debt to Holland and the UK that Icelandic citizens have voted not to repay.
Debtors holding a vote whether or not to repay their debt is a bit like criminals sitting on a grand jury.
Quote from: Admiral Yi on March 04, 2010, 04:19:57 PM
Quote from: Viking on March 04, 2010, 04:03:40 PM
No, Norway bails us out and are insufferably smug for the next 100 years.
I don't see how Norway can bail you out on a debt to Holland and the UK that Icelandic citizens have voted not to repay.
They haven't voted not to repay, nor is anybody suggesting that the payment won't be made, just complaining about the unfair terms. If Norway is suggesting that a solution would be for Norway to give Iceland a monstrously cheap loan (given our credit rating) to pay the brits and dutch. But they want us to make a good faith effort to try and solve this ourselves.
We should sink them afterall.
Quote from: Viking on March 04, 2010, 04:27:11 PM
They haven't voted not to repay, nor is anybody suggesting that the payment won't be made, just complaining about the unfair terms. If Norway is suggesting that a solution would be for Norway to give Iceland a monstrously cheap loan (given our credit rating) to pay the brits and dutch. But they want us to make a good faith effort to try and solve this ourselves.
Ah, OK. Off the top of your big fat head do you happen to know what rate the Brits and Dutchies are offering?
Quote from: Martinus on March 04, 2010, 04:26:57 PM
Debtors holding a vote whether or not to repay their debt is a bit like criminals sitting on a grand jury.
For your analogy to hold Icelandic voters would have to have the power to set their own credit rating.
Quote from: Admiral Yi on March 04, 2010, 04:47:11 PM
Quote from: Martinus on March 04, 2010, 04:26:57 PM
Debtors holding a vote whether or not to repay their debt is a bit like criminals sitting on a grand jury.
For your analogy to hold Icelandic voters would have to have the power to set their own credit rating.
In a sense they do, because if they decide not to pay, there is no way (short of an invasion) to force them to pay. Last time I checked there no world government to make them.
:unsure:
Iceland sounds very mature.
Quote from: garbon on March 04, 2010, 05:54:11 PM
Iceland sounds very mature.
1,000 years of carefully recorded inbreeding works wonders.
They should prostitute their elves out. If they are as good as it claims it could be quite the windfall for that warrior nation.
Quote from: The Brain on March 04, 2010, 05:55:51 PM
1,000 years of carefully recorded inbreeding works wonders.
What Wonder of the World is in Iceland?
Quote from: Martinus on March 04, 2010, 05:48:13 PM
Quote from: Admiral Yi on March 04, 2010, 04:47:11 PM
Quote from: Martinus on March 04, 2010, 04:26:57 PM
Debtors holding a vote whether or not to repay their debt is a bit like criminals sitting on a grand jury.
For your analogy to hold Icelandic voters would have to have the power to set their own credit rating.
In a sense they do, because if they decide not to pay, there is no way (short of an invasion) to force them to pay. Last time I checked there no world government to make them.
They can default; but will then have the same status as Argentina.
Quote from: garbon on March 04, 2010, 05:57:19 PM
Quote from: The Brain on March 04, 2010, 05:55:51 PM
1,000 years of carefully recorded inbreeding works wonders.
What Wonder of the World is in Iceland?
World's Largest Rotten Cod.
Quote from: Richard Hakluyt on March 04, 2010, 05:57:29 PM
They can default; but will then have the same status as Argentina.
Is Iceland claiming the Hebrides?
Quote from: The Brain on March 04, 2010, 05:57:48 PM
World's Largest Rotten Cod.
Eww. Sounds deliberately unsexy.
Quote from: garbon on March 04, 2010, 05:59:26 PM
Quote from: The Brain on March 04, 2010, 05:57:48 PM
World's Largest Rotten Cod.
Eww. Sounds deliberately unsexy.
Well, this is the land that spawned Björk after all.
Quote from: Admiral Yi on March 04, 2010, 04:45:09 PM
Ah, OK. Off the top of your big fat head do you happen to know what rate the Brits and Dutchies are offering?
effectively 6% iirc
Quote from: Admiral Yi on March 04, 2010, 04:47:11 PM
Quote from: Martinus on March 04, 2010, 04:26:57 PM
Debtors holding a vote whether or not to repay their debt is a bit like criminals sitting on a grand jury.
For your analogy to hold Icelandic voters would have to have the power to set their own credit rating.
In this case they can, sort of. If they can convince the Norwegians that the British and Dutch are being unreasonable then we'd be loaning with the Norwegian credit rating as a base since the norwegians will then either guarantee the loan (easy to convince norwegians to do as the public doesn't think they are actually losing money) or loan us at "cost". Very generous if you ask me. Not logical at all. This is effectively (from the norwegian point of view) helping out a relative.
Quote from: Iormlund on March 04, 2010, 06:01:41 PM
Well, this is the land that spawned Björk after all.
Venus As A Boy :wub:
Quote from: garbon on March 04, 2010, 05:57:19 PM
Quote from: The Brain on March 04, 2010, 05:55:51 PM
1,000 years of carefully recorded inbreeding works wonders.
What Wonder of the World is in Iceland?
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Quote from: garbon on March 04, 2010, 05:58:37 PM
Quote from: Richard Hakluyt on March 04, 2010, 05:57:29 PM
They can default; but will then have the same status as Argentina.
Is Iceland claiming the Hebrides?
Rockall iirc
Great, now this thread needs a NSFW tag. <_<
Quote from: Iormlund on March 04, 2010, 06:01:41 PM
Well, this is the land that spawned Björk after all.
http://en.wikipedia.org/wiki/Sigur_R%C3%B3s
Quote from: Viking on March 04, 2010, 06:11:36 PM
http://en.wikipedia.org/wiki/Sigur_R%C3%B3s
You find men sexy? :hmm:
I f'ng love Sigur Ròs. And EVE. :blush:
Quote from: Viking on March 04, 2010, 06:20:24 PM
The music, not the dicks.
How do you separate the two?
Quote from: Viking on March 04, 2010, 06:20:24 PM
Quote from: garbon on March 04, 2010, 06:15:42 PM
Quote from: Viking on March 04, 2010, 06:11:36 PM
http://en.wikipedia.org/wiki/Sigur_R%C3%B3s
You find men sexy? :hmm:
The music, not the dicks.
Although the singer's voice is kinda of girly in an odd way... makes me almost wonder if he is a castrato :blush:
Quote from: Martinus on March 04, 2010, 05:48:13 PM
In a sense they do, because if they decide not to pay, there is no way (short of an invasion) to force them to pay. Last time I checked there no world government to make them.
That's true of any act by a sovereign state.
Quote from: garbon on March 04, 2010, 06:21:10 PM
Quote from: Viking on March 04, 2010, 06:20:24 PM
The music, not the dicks.
How do you separate the two?
I imagine it's the Pussycat Dolls actually singing.
Quote from: garbon on March 04, 2010, 06:21:10 PM
Quote from: Viking on March 04, 2010, 06:20:24 PM
The music, not the dicks.
How do you separate the two?
One I can load up on my IPod and other I can get in my ear.
Quote from: Admiral Yi on March 04, 2010, 06:22:41 PM
Quote from: Martinus on March 04, 2010, 05:48:13 PM
In a sense they do, because if they decide not to pay, there is no way (short of an invasion) to force them to pay. Last time I checked there no world government to make them.
That's true of any act by a sovereign state.
Sovereign Immunity FTW!!
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Quote from: The Brain on March 04, 2010, 05:55:51 PM
Quote from: garbon on March 04, 2010, 05:54:11 PM
Iceland sounds very mature.
1,000 years of carefully recorded inbreeding works wonders.
And that was before they cut down all the trees and were fated to live in poverty.
90%+ voted no. But that doesn't matter since everybody involved has moved on to a different proposal. Icelandic local politics, however, demanded that the people get to say no to a plan that nobody was proposing any more. Idiots.
In other news the President (the guy who started this whole thing) is pissed off with the Nordics for not bending over and giving us money.
Fight the power Iceland!
I wonder what legal recourse, if any, the creditors have.
Quote from: Admiral Yi on March 07, 2010, 06:26:54 AM
Fight the power Iceland!
I wonder what legal recourse, if any, the creditors have.
?
Iceland and Britain and The Netherlands are already discussing a different package with lower interest rates. Before this referendum. The referendum rejected a plan previously abandoned by both sides. What part of this irrational stupidity don't you get?
Effectively Britain and The Netherlands compensated it's own residents for losses in a bank in another country and then demand that that other country then paid them back.
93.2% said no, 1.8% said yes and 5.0% had nothing better to do than spoil their ballots. Turnout was around 62%.
Letting the people vote on that....wasn't that a bright idea!
Quote from: Tyr on March 07, 2010, 08:01:40 AM
Letting the people vote on that....wasn't that a bright idea!
That's what the PM said, she didn't vote, she stayed at home with her lesbian lover.
Quote from: Viking on March 07, 2010, 06:29:53 AM
Effectively Britain and The Netherlands compensated it's own residents for losses in a bank in another country and then demand that that other country then paid them back.
My understanding is that Iceland was obligated to guarantee those accounts, no?
Quote from: Faeelin on March 07, 2010, 03:56:46 PM
Quote from: Viking on March 07, 2010, 06:29:53 AM
Effectively Britain and The Netherlands compensated it's own residents for losses in a bank in another country and then demand that that other country then paid them back.
My understanding is that Iceland was obligated to guarantee those accounts, no?
Yes, and had it not those people could have sued the Icelandic government in icelandic courts. Instead of having that happen the dutch and british governments froze the assets of the banks using anti-terror laws and then compensated local depositors before declaring that the icelandic government owed them what had been used to compensate the depositors.
Then the discussion started about how the Icelandic government could pay their creditors.
Previously deposit insurance has always been the case of the local government guaranteeing the deposits of the electorate, so stringent deposit insurance criteria have never been needed, it has always been a case of the government effectively guaranteeing deposits. This is not a problem where a highly motivated government (voters are depositors) with funds on par with the problem (only voters are depositors). However when banks have foreign customers but do not list abroad the government is not very motivated (screw the dutch, they don't vote in our elections) and the funds are not on par with the problem (you had how many times our population as customers?) then the flimsy existing rules do not suffice.
Previously foreign customers have been screwed over when banks go bust getting only a percentage of deposits, but in those cases the EEA did not apply.
Iceland is obligated to pay, yes, but the UK and the Netherlands have been taking liberties as if the banks were local and demanding action from iceland as if the banks were icelandic. It's more complicated than that.
Quote from: Viking on March 07, 2010, 04:22:23 PM
Previously foreign customers have been screwed over when banks go bust getting only a percentage of deposits, but in those cases the EEA did not apply.
What do you mean by this? First, what is the EEA, and second what are you referring to when you talk about foreign customers who got screwed previously?
Quote from: Admiral Yi on March 07, 2010, 05:21:51 PM
Quote from: Viking on March 07, 2010, 04:22:23 PM
Previously foreign customers have been screwed over when banks go bust getting only a percentage of deposits, but in those cases the EEA did not apply.
What do you mean by this? First, what is the EEA, and second what are you referring to when you talk about foreign customers who got screwed previously?
The EEA is the European Economic Area which integrates certain non-members of the EU into certain EU levels of integration. Iceland, Norway and Lichtenstein are non-members of the EU which are economically integrated into the EU.
http://en.wikipedia.org/wiki/European_Economic_Area
foreign customers?
WaMu, the problem here (for the icelandic government) is the EEA agreement prevents discrimination against foreigners.
Washington Mutual's foreign depositors only got a fraction of their deposits back? :huh: