[Liskaspexia]

Thanks, but that's not really very helpful.

I was hoping that someone who knows the gory details might point me in the right direction to understanding a legitimate claim on the taxpayers of Iceland.

Or, someone else might point out that Euros are being tuuats, and be able to explain why.

[st01en_lox]

What do the Dutch and Brits have against Iceland over cod?

[Afigenatjola]

You silly Dane. When you say Cod War, I think Danny Williams.

It is just like an American to be so conceited that he thinks everyone is should be familiar with the things that interest him.

[xochex]

Damn straight!

[OmqMZtkv]

Danny Williams is pretty serious about killing trees.

[olivelappers]

I'm wondering how this works. Icelandic banks failed and the governments of GB and Netherlands saved depositors in their respective countries.

Why would they then expect Icelandic taxpayers to pay them back?

When the banks failed, the governments stepped in to guarantee deposits. So when the British government bailed out RBS, Northern Rock and Lloyds Banking Group, it safeguarded all investors. It didn't go "OK, we'll safeguard the British investors, but no foreign ones."

Iceland, however, wants to play the "let's get out of safeguarding the foreign investors who have built our economy" game. If they do that, they'll avoid the bad austerity measures they'll have to take, but they'll be financial outcasts.

[mirzaterak]

Because their government agreed to the loan terms last August. Then tried to change the terms after accepting the loan, and now is going to a referendum as to whether they repay the loan at all.

This is on top of the IMF aid, and the EU application. If Iceland is screaming for help from other nations, it can't try ripping off its creditors.

[new-nickname-zanovo]

As far as I have understood the situation is as follows:

Iceland is part of some sort of European Economic Zone (No, not the EU). Subsequently Icelandic banks can do business in other memberstates as long as they have a licence from the Icelandic Central Bank. Icesave had such a licence. The central bank guarantees deposits at such licenced banks up to 20K euro (per person (or account?) in case of a collapse of the bank.

When mayham started in the US leading to the credit crisis, The Dutch Finance Department increased the guarantee to 100K euro because they feared people would withdraw their savings from any Bank in the Netherlands. When Icesave fell, the Netherlands (apparently together with the UK) negotiated with the Icelandic parliament a deal that their Central Bank would cover the extra 80K.

Soon the Icelandic government collapsed, leading to new elections and the new parliament now wants to cancel the deal.

[Fouttysotlalf]

I love how the Danes and the Canucks are slandering each other by accusing the other of American-ness.

Obviously we agree on something.

[MrGunjMan_]

As an American, even I knew about the Cod wars. Silly Canucks.

So you're a geek.

[c-cialis]

Tulsa, Oklahoma is bigger than Iceland.

[MADwanker]

Is there anything you can share?

[Jxmwzgpv]

Not really. Sorry.

This is public information though:

http://www.ft.com/cms/s/0/683b2926-1...44feab49a.html

An internal Kaupthing credit report leaked on the internet last year laid bare the kind of questionable lending practices and business connections under investigation by Mr Hauksson’s team.

It showed that much of the bank’s lending went to its own biggest shareholders and a select group of favoured clients – often with little or no security. Investigators are probing whether some of the loans were reinvested in the bank to pump up its share price. http://www.ft.com/cms/s/0/86df95d2-8...nclick_check=1

Foreign hedge funds were initially blamed by many Icelanders for bringing the country to its knees, but Vilhjalmur Bjarnason, director of the Iceland Shareholders Association, says the evidence increasingly suggests home-grown culprits. “We did not need hedge funds to bring the system down. The insiders did at least as much damage,” he says.

[sterofthemasteool]

Is this directed at NYE or BFB?

NYE

[Precturge]

After reading about the Cod Wars (best part was "Not to be confused with the Cold War."), I'm proud of the plucky Icelandic Navy defying the Royal Navy. Must have been pretty humiliating to be British back then. Heck, it must be pretty humiliating to be British today.

It was Britain's Vietnam.

[Trientoriciom]

After reading about the Cod Wars (best part was "Not to be confused with the Cold War."), I'm proud of the plucky Icelandic Navy defying the Royal Navy. Must have been pretty humiliating to be British back then. Heck, it must be pretty humiliating to be British today.

It's easy to be philosophical about it now, when Iceland is doing the sovereign nation equivalent of sucking penises for pennies.

[drugstore]

Iceland is part of some sort of European Economic Zone (No, not the EU). Subsequently Icelandic banks can do business in other memberstates as long as they have a licence from the Icelandic Central Bank. Icesave had such a licence. The central bank guarantees deposits at such licenced banks up to 20K euro (per person (or account?) in case of a collapse of the bank.

In fact, the 20K (minimum) was guaranteed by a fund in turn guaranteed by the rest of the banking system. What happened in Iceland, and which was apparently not foreseen in the EEA regulations, was a collapse of a country's banking system after a run on irresponsible banks. Now, Iceland's position has consistenyl been that the government itself is/was not legally responsible to cover the fund. The UK/NL apparently disagree. Iceland nationalizes Landsbanki and bails out all Icesave depositors in Iceland (up to 20K), ostensibly to retain a domestic banking system at all. The UK/NL argue discrimination.

The UK/NL bail out depositors in their countries including the 20K that fell on the Icelandic fund and make it clear they expect Iceland to pay them back. Meanwhile, Iceland's economy tanks and alst fall they pass a bill that agrees to take on the debt from the UK/NL depositors - basically, they assert their legal position in principle but in order to get IMF aid and fix their credit rating they cave. The bill had a number of caveats, like the payments can't exceed a certain fraction of Iceland's GDP (necessary because the debt is nominated in euros), and I believe it had a couple of years grace before payments would start. Now, the UK/NL finds the caveats unacceptable. This prompts another bill without them that narrowly passes the Icelanic parliament in december.

The exact amount to be paid is subject to uncertainty depending on how much of Landsbanki's assets are recoverable, but has been estimated to average 1-1.5% of GDP for up to a decade, if nothing out of the ordinary happens in that time. The Icelandic public feels they have been tricked by their own corrupt politicians and bankers and by irresponsible mostly foreign investors into a Versailles-like treaty. Expect more domestic turmoil in Iceland...

Iceland, however, wants to play the "let's get out of safeguarding the foreign investors who have built our economy" game. If they do that, they'll avoid the bad austerity measures they'll have to take, but they'll be financial outcasts.

Claiming that the Icesave investors built Iceland's economy is just absurd. Iceland caught up to Scandinavian living standards well before the 80s and any banking deregulations. The only ones who profited are some criminal bankers and their corrupt friends.

Defaulting would be the worst thing for Iceland, and I hope they are smarter than that. But there's nothing wrong with shaming Britain and Netherlands for their aggressive and ethically questionable behavior against a supposed ally.