Miss Kolka

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Lets all pick on Iceland | 13 novembre 2008

What has been going on these last few days is just incredible - Its like Iceland is the little weird kid in the playground all the other kids like Britain, Holland, the EU and even the scandinavian cousins have decided to pick on, just to be mean.

As was all over the news a couple of months ago - Iceland ended up nationalizing its 3 major banks by force.Two of them got into financial troubles linked to the international economic crisis and the third one lost all its influence and trust in the financial world when the British government accused it of being in the same situation as the 2 others and created a local panic in the UK when they annonced that Iceland would not pay up to account owners (which turned out to be uncertain at that time). The chain of event is unclear - who knew what when and how it all started - but it seems pretty clear that a few Icelanders were on top of the world for a few years, invested abroad and got their companies and banks into debts that far exceeded the country's GDP. What I dont understand is how Iceland's government and therefore its people would become responsible for all this debt if the banks ran into trouble, as they did.

SO what is now known as the "Icesave" matter is not helping the situation. Britain and Holland have demanded that if Iceland is to have a loan - any loan from the IMF, the EU or its scandinavian partners - it should primarly go into paying what they owe deposit savers in these local branches of the former Icelandic "private" bank (its good to have a little reminder). In clear this means that Iceland should borrow money - not to save the dire economic situation that is bankrupting 60-80% of the countrie's private sector - but to pay to people owning money in the branches in Britain or in Holland. That means putting the whole country in debt for years, not even to create jobs or help with currency problems there (people can not change the almost worthless Icelandic krona that keeps devaluating, they get maximum 180 euros if they have a plane ticket to travel abroad and can not use their cards) but only to pay off a debt that was created by private businesses that had alot when all was good and now that things are bad have run away from their responsabilities.

Those who owned these banks and companies have not had to answer for any of this. One of the families still owns their pet football club West Ham and another family is looking to buy all of Iceland's media for peanuts. Why can't they sell their assets to pay off some of this debt? At the same time its of course the average joe that is loosing his job (unemployment could rise above 10% after christmas - always been under 1%), people see their savings disappear and many of those keeping their jobs will notice the payment of their loans increase at the same time as the value of their houses will decrease, everything else will double in price (since Iceland is very dependent on imports and since there is NO foreign currency available there is a question how many products will STILL be available in shops in a few weeks time). So its all a very gloomy picture. People are predicting that due to unemployment many people will seek to further educate themselves while a third of the population has said it is considering moving away. Very sad indeed for my little country. At least I can be happy that mother Kolka works for the University - there is bound to be enough work there.. whether the salary will amount to anything is perhaps another matter.

Keep strong.

Publié par Kolka à 16:23:16 dans Miss Kolka | Commentaires (0) | Permaliens