The opening statement is a crock of bull. Creditors were not told to take a hike. The creditors became the owners of the banks erected to maintain the banking system. I'm sure they took a haircut of some sort and the capital controls forced them to maintain their assets in Iceland, but to the population at large it does not feel like the banks lost at all. They have been profitable EVERY QUARTER since then. The new banks got a firesale deal on the paper assets and have been making out like gangbusters.
I hate how the Icelandic Economic Wonder is held up as a model for others. Monetary policy is crap. The Fed (or our anemic facsimile thereof) blindly believes in the disproven assumption that interest rates control inflation (at least for microeconomies).
Meanwhile wages are stagnating, unemployment is high, social programs are under siege EVEN with the most left leaning government we have seen EVER in the history of Iceland. Mortgages are adjusted with the CPI but wages are not. I for the life of me can't see why the higher price of tomatoes or ketchup should raise my debt with the bank.
I have much more to say on the issue but need to maintain my anger below flashpoint so I can do some work. Christmas is coming.
I hate how the Icelandic Economic Wonder is held up as a model for others. Monetary policy is crap. The Fed (or our anemic facsimile thereof) blindly believes in the disproven assumption that interest rates control inflation (at least for microeconomies).
Meanwhile wages are stagnating, unemployment is high, social programs are under siege EVEN with the most left leaning government we have seen EVER in the history of Iceland. Mortgages are adjusted with the CPI but wages are not. I for the life of me can't see why the higher price of tomatoes or ketchup should raise my debt with the bank.
I have much more to say on the issue but need to maintain my anger below flashpoint so I can do some work. Christmas is coming.