Unlike other nations, including the U.S. and Ireland, which injected billions of dollars of capital into their financial institutions to keep them afloat, Iceland placed its biggest lenders in receivership. It chose not to protect creditors of the country’s banks, whose assets had ballooned to $209 billion, 11 times gross domestic product.
“Iceland did the right thing by making sure its payment systems continued to function while creditors, not the taxpayers, shouldered the losses of banks,” says Nobel laureate Joseph Stiglitz, an economics professor at Columbia University in New York. “Ireland’s done all the wrong things, on the other hand. That’s probably the worst model.”
Ireland along with the US, that is. Obama has cheerfully shoveled hundreds of billions of taxpayer money to the big banks and changed accounting rules so they could price their garbage assets at whatever they wanted. What do we have to show for this? The recession is still here. Unemployment and foreclosures are much too high. And those banks are still insolvent.
Meanwhile, Iceland, who put the interests of their citizens and country before those of the banksters and bondholders, is recovering. This country should do the same.
TheTrudgnCurmudgn in L.A. puts a face on it.
Was watching the news recently and saw something that really bummed me out. They where doing a story about all the people that went to the sports arena because they where loosing their homes and where looking for relief in the form of a re-finance. Suddenly, there on the screen was a good friend of mine. They chose him at random to be interviewed. I watched in horror as he told his story. Here was a guy who is a damn good musician and a hard worker and he’s about to lose his house.
Maybe by now you’re saying, “Old news. We see that all the time now a-days”. And, you’d be right…. except this was a friend of mine and that made it personal.
Connect the dots. Bailing out the banksters leads directly to more people losing their homes.