4 ms·
Would this have been worse (or better) if Iceland had not nationalised their banks and simply allowed them to go bankrupt?
by dublinclontarf 18y ago
Would this have been worse (or better) if Iceland had not nationalised their banks and simply allowed them to go bankrupt?
- vidar 18y agoThe problem was that there was (and still is to some extent) some confusion about how much of their debt was implicitly or explicitly insured by the government. And yes, I realize how ridiculous this sounds but these things (billions of dollars in obligations) really were completely up in the air, partly due to crap EU legislation.
- myutdtme 18y agoWhen you owe 850% of your GDP it doesn't really matter if you nationalize them or not - your country is screwed.
- wmeredith 18y agoWhat about 350%? (USA)
- myutdtme 18y agoDepends if you spent the money you borrowed on Nukes or Herring :-)
- mellis 18y agoThat number seems to be inaccurate. The Treasury Direct website http://www.treasurydirect.gov/NP/BPDLogin?application=np http://www.treasurydirect.gov/NP/BPDLogin?application=np states that the total U.S. public debt is: 10,943,838,929,434.92 (~11 trillion dollars). The U.S. GDP is close to 14 trillion dollars, making the debt somewhat less than 100%. I'm not sure where that 350% figure comes from.
- troystribling 18y agoI think it is debt owned by banks not national debt.
- electromagnetic 18y agoThe real question would be, would Iceland have been better if it never privatized banks to begin with and never adopted Americanized economics.
- petercooper 18y agoIt depends if having all of your country's assets overseas seized and gunboats arriving in Reyjavik would be better than the current situation or not. When you owe other countries a ton of money and you're not paying, you either need a quid pro quo, a payment plan, or you're going to get your balls busted.
- gaius 18y agoI did idly wonder if it would come to that, when Icesave announced it wouldn't honour guarantees given to British savers. Iceland's defence strategy during the Cold War was to umm, do nothing, and rely on NATO, knowing that it would never permit the Soviet Empire to gain such a strategic foothold. Even tho' the Royal Navy is but a shadow of its former self, invading Iceland would have taken all of one afternoon, if that.
- petercooper 18y agoEconomically the UK almost did that by seizing Icelandic assets. Quite the quid pro quo, pun intended ;-)