Tuesday, December 3, 2013

Iceland still has a few Vikings

The Iceland story never fails to make me feel like there is still some hope for humanity.  Their little spat with the banksters managed to get them listed as a bunch of terrorists by the Brits, after all.  Apparently, there is such a thing as institutional memory—"from the fury of the Northmen, deliver us oh Lord" lives on.  Of course, putting a country out of business to pay for the crimes of cheaters must have certainly offended the Viking sense of justice.  I don't think the elders at Althing would have paid off the banksters either.

So now they have a scheme to bail out all their homeowners.  Re-setting the finances is in the interest of every citizen of the island.  So of course, IMF and OECD—those repositories of economic insanity—have informed the Icelanders it is a bad idea.  Of course it's a "bad" idea—organized debt restructuring would end much of the bankster rape of the planet so these organizations which are arms of international banksterism intend to kill this idea in its infancy.

This is quite important to the lords of high finance.  Turns out that if these folks could not cheat and game the system, they don't make any money—and certainly not the sums they think they are worth.  And the rest of us would love to see them go—I don't know anyone who can afford to support this useless protoplasm.  Besides, less than 1% of what they do is of ANY value to the real economy.

Go Iceland!

Iceland thumbs nose at international opposition to advance $1.2 billion debt relief plan

December 01, 2013

Iceland’s government has announced that it will be writing off up to 24,000 euros ($32,600) of every household’s mortgage, fulfilling its election promise, despite overwhelming criticism from international financial institutions.

The measure was introduced by the country’s prime minister, Sigmundur David Gunnlaugsson, the leader of the Progressive Party which won the late-April elections on a promise of household debt relief.

According to the government’s website the household debt will be reduced by 13 percent on average.

Citizens of Iceland have been suffering from debt since the 2008 financial crisis, which led to high borrowing costs after the collapse of the krona against other currencies.

“Currently, household debt is equivalent to 108 percent of GDP, which is high by international comparison,” highlighted a government statement, according to AFP. "The action will boost household disposable income and encourage savings.”

The government said that the debt relief will begin by mid-2014 and according to estimates the measure is set to cost $1.2 billion in total. It will be spread out over four years.

The financing plan for the program has not yet been laid out. However, Gunnlaugsson has promised that public finances will not be put at risk. It was initially proposed that the foreign creditors of Icelandic banks would pay for the measure.

International organizations have confronted the idea with criticism. The International Monetary Fund (IMF) and the Organization for Economic Cooperation and Development (OECD) have advised against it, citing economic concerns.

Iceland has “little fiscal space for additional household debt relief” according to the IMF, while the OECD stated that Iceland should limit its mortgage relief to low-income households.

In the meantime, ratings service, Standard & Poor's, cut back on its outlook for Iceland's long-term credit rating to negative from stable, stating that the economic measure could affect the confidence of foreign investors if it ends up being paid for by the existing creditors of Icelandic banks. more

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