"Why do we consider banks to be like holy churches?" is the
rhetorical question that Iceland's President Olafur Ragnar
Grimson asks (and answers) in this truly epic three minutes
of truthiness from the farce that is the World Economic
Forum in Davos. Amid a week of back-slapping and
self-congratulatory party-outdoing, as John Aziz notes, the
Icelandic President explains why his nation is growing
strongly, why unemployment is negligible, and how they moved
from the world's poster-child for banking crisis 5 years ago
to a thriving nation once again. Simply put, he says, "we
didn't follow the prevailing orthodoxies of the last 30
years in the Western world." There are lessons here for
everyone - as Grimson explains the process of creative
destruction that remains much needed in Western economies -
though we suspect his holographic pass for next year's Swiss
fun will be reneged...
January 29, 2013 -
Court: Iceland Doesn’t Need to Repay UK and Dutch Depositors
By Agence France-Presse
January 29, 2013 -- Iceland was entitled to refuse
to pay immediate deposit guarantees to savers with failed
online bank Icesave in Britain and the Netherlands, a
European court said Monday.
The ruling is the latest twist in a bitter dispute which has
clouded negotiations on Iceland’s ambitions to become a
member of the European Union.
The Court of the European Free Trade Association (EFTA),
which covers economic and trading relations between non-EU
countries that are a part of the European Economic Area (EEA)
single market and their European Union partners, was ruling
on Reykjavik’s response to the collapse of the Icelandic
banking sector in 2008-9.
The British and Dutch governments spent 3.9 billion euros
($5.5 billion) compensating 340,000 of their citizens who
lost their savings in the collapse.
Iceland did not, and the EFTA Court upheld its approach, the
court saying it had “dismissed the application” supported by
London, The Hague and the European Commission.
The decision was based on three reasons — including the fact
that Icelandic banking law at the time did not specify how
to handle a major banking crisis of such global scale.
The ruling did not, however, call for monies already
reimbursed to be clawed back.
Deals to use tax-payer money to refund the Icesave debt have
been twice rejected in referendums so the assets of failed
parent Landsbanki are the only way Iceland can settle the
In December, the group tasked with winding up Landsbanki
reimbursed the first third of monies due to savers who lost
money in the collapse of its Icesave — to the tune of 432
billion Icelandic kronor (2.71 billion euros, $3.64
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