Tuesday, April 12, 2011

little iceland panics big banks

The Daily Bell | For those of us who believe that the world and especially the West is headed in the wrong direction with its endless emphasis on centralization and consolidation leading inevitably to a "one-world order," the saga of little Iceland versus the big banks is actually an inspiring tale. This little nation of 300,000 has twice now voted against accepting a nearly US$7 billion national debt – accrued by several reckless Icelandic financial institutions – that would make every citizen responsible for their banks' actions and the equally rash actions of the Dutch and British governments.

The problem is aptly summed up by a splendid little article in the Wall Street Journal (excerpted above) by Hannes H. Gissurarson out of Reykjavik, Iceland. He explains the evolution of the contretemps as follows:

How Icelandic taxpayers got stuck with this bailout bill is a strange saga. When the international financial crisis hit bottom in the fall of 2008, it became clear that the Icelandic Insurance Fund for Depositors could not cover all the liabilities of the foreign branches of the private Icelandic bank Landsbanki. In order to avoid a general run on their own banks, the British and the Dutch governments decided to reimburse depositors, for not only the principal, but also the interest due, in Landsbanki branches in their countries, up to a certain level.

These two governments then presented the bill to the Icelandic government: £3.5 billion. For the tiny Nordic nation of 320,000, this was an enormous sum, amounting to half of its annual GDP. It would be equivalent to a £700 billion claim on the British government. The Icelandic government protested that it was not responsible for deposits in private banks. It had fully complied with European law in setting up the Icelandic Insurance Fund for Depositors, financed by a levy on the banks.

If the fund could not meet its obligations, it was a problem for those who, at their own risk and for a quick profit, had entrusted their money to Landsbanki. But under threats from the British and the Dutch governments, supported by the European Union and the International Monetary Fund, at the end of 2009 Iceland reluctantly signed a treaty according to which it had to pay the total sum, with stiff interest rates, to the United Kingdom and the Netherlands.

The import of the above unfairness is powerful for those who believe (as we do) that the 21st century is marked by a clash between the truth-telling of the Internet and the dominant social themes – the fear-based promotions – of the Anglo-American elite that seeks a One-World Order. The power elite, which has been attempting to create global government for nearly a century now, or perhaps longer, needs to project a certain inevitability. Iceland's two rejections of attempts to force its citizens to pay for the financial mistakes of others must be causing nausea in the City of London and upending the sense of inevitability that is so important to the wretched bullying that has become the trademark signature of the European Union.


Uglyblackjohn said...

Nice graphic - but it won't happen until the Second Coming.

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