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93% Of Icelanders Reject "Icesave" Bill In Historic Referendum
Another European country is about to be cut to junk by the rating agencies, after a whopping 93% of Iceland voters turned down the ironically named Icesave bill in a historic referendum, which would have saddled citizens with an additional $16k in debt to compensate the UK and Holland with a $5.3 billion note for the failure of Landsbanki. The vote failure, which has already prompted Fitch to downgrade the country to junk, and is now sure to see Moody's and S&P follow suit, has left many to believe that a government crisis is now imminent. Another implication is that an IMF-led loan is now in limbo, demonstrating that the international bailout watchdog is truly powerless when the people of the bailout recipient nation want to have nothing to do with the international rescue circuit.
What is amusing is that the disconnect between what governments think their people want and what people actually want has become unprecedented:
The Icesave deal passed through parliament with a 33 to 30
vote majority. Grimsson blocked it after receiving a petition from
a quarter of the population urging him to do so. The government has
said it’s determined any new deal must have broader political
backing to avoid meeting a similar fate.
Icelanders used the referendum to express their outrage at
being asked to take on the obligations of bankers who allowed the
island’s financial system to create a debt burden more than 10
times the size of the economy.
The nation’s three biggest banks, which were placed under
state control in October 2008, had enjoyed a decade of market
freedoms following the government’s privatizations through the end
of the 1990s and the beginning of this decade.
“This referendum is very peculiar and without any parallel in
Iceland’s history,” said Gunnar Helgi Kristinsson, a professor of
political science at the University of Iceland, in an interview.
And in Iceland, the people not only don't care about what the IMF or the UK think, but they are certainly making their opnioins against the executives of the failed bank felt, in a way that Americans only wish they could.
“Ordinary people, farmers and fishermen, taxpayers, doctors,
nurses, teachers, are being asked to shoulder through their taxes a
burden that was created by irresponsible greedy bankers,” said
President Olafur R. Grimsson, whose rejection of the bill resulted
in the plebiscite, in a Bloomberg Television interview on March 5.
Protesters have gathered every week, with regular numbers
swelling to about 2,000, according to police estimates. The last
time the island saw demonstrations on a similar scale was before
the government of former Prime Minister Geir Haarde was toppled.
Icelanders have thrown red paint over house facades and cars
of key employees at the failed banks, Kaupthing Bank hf, Landsbanki
and Glitnir Bank hf, to vent their anger. The government has
appointed a special commission to investigate financial malpractice
and has identified more than 20 cases that will result in
prosecution.
In the meantime, Iceland, which as recently as 2007 used to be one of the richest countries on a per capita basis, is seeing the net wealth of its citizens sublimate.
The island’s economy shrank an annual 9.1 percent in the
fourth quarter of last year, the statistics office said on March 5,
and contracted 6.5 percent in 2009 as a whole.
Household debt with major credit institutions has doubled in
the past five years and reached about 1.8 trillion kronur ($14
billion) in 2009, compared with the island’s $12 billion gross
domestic product, according to the central bank. Icelanders, the world’s fifth-richest per capita as recently
as 2007, ended 2009 18 percent poorer and will see their disposable
incomes decline a further 10 percent this year, the central bank
estimates.
Grimsson, who has described his decision to put the depositor
bill to a referendum as the “pinnacle of democracy,” says he’s
not concerned about the economic fallout of his decision.
At this point we will take the opportunity to remind readers once again that the biggest fan of the Iceland experiment was none other than the worst and most full of methane Fed board member in the history of the US Central Bank, Fred "Iceman Napoleon" Mishkin, who not surprisingly has made cheerleader-central CNBC his newest media forum, as he conducts yet another monetary calamity lemming cascade off the cliffs, this time not of Reikjavic, but first of Dover, and then of D.C. (the analogy would be more appropriate if D.C. actually had any cliffs as opposed to 50% underwater housing, and an administration full of hyperinflated hot air).
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Nice piece of writing. I'll have to seek out your comments in the future.
Frederic Bastiat spoke about the rule of law being subordinated by those that desired to legitimatize plunder. It is indeed tragic that property rights have been subordinated by "lawful" plunder at the hands of those who have no other objective than multi million dollar federally guaranteed Wall Street minimum wage welfare payments and food stamp meals and "entertainment" in the thousands at a crack all for making markets in national & regional stability for fun & profit.
Excellent writing Gussiefink-nottle. +1
Sublimate: Turn from solid to gas without passing through a liquid phase.
Excellent work, Tyler.
Going out to buy some red paint tomorrow.
Me too. It'd be interesting to see the judicious application of red paint become popular here in the U.S.
Hooray! Another country is going to default on its debt! Next, maybe the US will follow suit. Because we all know how much ZH wants that to happen, right?
Hey Summer's Eve...
Quit being a asshat. Reporting shitty news doesn't mean that anyone wants shitty news. What we do want is the truth, which we're not getting in the lame stream media.
Does this mean that they are on double-secret probation now?
Congrats to the people of Iceland!!!!
Obviously they weren't using Diebold electronic voting machines...
heh. Or having their votes routed through a private firm first..
So, this is what happens when you don't use Diebold electronic voting machines? How gauche is that?
Bravo Iceland.
Whoever mismanaged this bank should be stripped of all his assets... all of them. There's only one reason this bank went belly up: someone mismanaged it.
I wouldn't care what the consequences are for defaulting... you're screwed one way or another regardless of what path you take when you're in that deep.
When they come for you saying you must pay your fair share of the US debt, just tell them no thank you very much, I never got to vote on any of this, stick it in your ear.
Should the last word have an R prior to the letters EAR ??
I should remind you that the debt is far bigger than the collective American orifice can take without major rupture.
If you do your sums on it you will understand that the last one out must turn off the lights. True democracy means never having to say "whatever dude"
Not excellent work, but poor research.
The referendum was pointless anyway because the compensation of the Dutch and British savers in 'Icesave' has meanwhile been renegotiated. The revised terms are more favourable for Iceland and may well be passed by parliament and not vetoed by the president.
You Americans must be losing quite a lot of money in Europe if you always read only half of the story.
You have failed to convince me that you know any more than anyone else here.
So: How much did you lose, exactly, placing your money in an online bank in a foreign country?
Perhaps you missed the key phrases "trying to negotiate" and "he is 'disappointed' that the agreement hasn't yet come into effect".
Maybe we can read just fine. And maybe some of us even know how to see through propaganda. The media here is pitching this as no big deal:
(from http://www.nytimes.com/2010/03/07/world/europe/07iceland.html)
because you don't want the 'people' getting any ideas that you can 'just say no' to bankers. But if you read further:
Key phrase being "on the table". So maybe it is a little premature to say the referendum was pointless. My guess is that if they don't pass something, Iceland will be 'made an example of'.
Good Interview with Birgitta Jonsdottir of "the movement" in Iceland on Max Keiser in January. All about the public rejecting the private debt and the underlying illegality of it all. Guess the icelandic bankers are hiding in london somewhere. We need leaders like this with an ethical spine and an ounce of courage. "it's time for the people of the world to revolt against these bankers"
http://maxkeiser.com/2010/01/14/kr08-the-keiser-report-markets-finance-scandal/ (at 14 mins)
Thank you DJ. Right on time. I couldn't remember where I had seen that and I failed to properly bookmark it.
china will step in ,, fund a nice sea port,,
or russia,, the east meets the west ,, touche'
sorry but it seems only 33% of the vote has been counted...they will manage to change teh remaining votes in their favour...
93% of 33% votes...
I was a UK customer of Icesave and got my money back from the Financial Services Authority. At the time I was totally dumb in financial matters and my reason for opening a SAVINGS account was that it was covered by the FSA compensation scheme. I would not have opened one if it wasn't covered by that scheme.
The interest rate paid was about 0.5% more than other accounts but remember back then that there were a number of institutions offering 5% + interest on internet savings accounts. To me 0.5% more than others did not ring alarm bells but then what did I know?
I have undergone an education of sorts in financial matters
since that time through following this site and others and I agree with what the Icelanders are doing as I firmly believe that ultimately the UK government is to blame for the fiasco (not withstanding the prime culpability of the Icelandic banksters)
The EU had passed legislation that allowed financial institutions easy access to fellow member states and this resulted in Icesave opening up in the UK. The FSA have claimed that the EU legislation tied there hands when it came to looking into the affairs of a foreign bank even though it was operating in the UK.
So:
1) If the FSA could not treat Icesave the same as any other UK bank why the hell were they allowed to operate in the UK?
2) Why didn't the FSA apprach the government with their concerns if they felt they hands were tied due to EU legislation?
3) If the UK were not members of the EU this would never have happened (in the UK at least).
You obviously were not completely dumb anon,
you made sure your money was in an insured account. Many folks and businesses on this side of the pond lost beaucoup bucks by being
over the insurance limits when the likes of
IndyMac failed, before the $250k limit was
put in place and now extended until Dec 31, 2013
This has been an education for all us, thanks
for recounting your experience...
The *bankers* are to blame--not the governments or the citizens. I am mystified why the bankers that made these extremely risky bets with other people's money aren't prosecuted globally.
I guess people want freedom and not debt slavery afterall. Imagine that.
If I were an IceSLAVE, I'd start mailing fish to Holland and the UK and to the IMF. I'd also try to find a way to abolish the central bank.
Fish are valuable. Send the fish heads.
Icelanders made my weekend - dont know what the eventual outcome will be though !!
Too bad this won't make the news, but all those rumors on how the EU is coming up with a brand new help package will make great headlines. Until they get dismissed by Angela Merkl the next day for the thousandth time.
But it did make the news - Zero Hedge is the news. Pulitzer Prize worthy content.
He got to say "sublimate".
Yes way to go Icelanders!
"Fire from Ice".
"Let it burn" is the only solution. People
cannot carry the burden the state is asking
them to shoulder.
There is another solution. Repatriate most of the wealth stolen from sovereign nations by the banking cartels that bankrupted those nations via military and resultant economic enslavement.
http://funy1.blogspot.com/2010/03/even-sun-eventually-flares-on-usurious...
It requires the end of usury and instituting a banking system with very low interest rates such as the one controlled by the state of North Dakota.
http://www.prorev.com/2009/03/how-north-dakotas-banking-system-could.html
This is all about 5 billion dollars? Hell, Ben and Timmy wouldn't even bother to bend over to pick up that miniscule sum!
Well Iceland has a population of 1/1000 of America excatly so this equals 5 trillion $ to USA.
bravo iceland. there is still strength in the world; or perhaps this is a harbinger of things to come.
Why don't the English and Dutch invade the place and enslave their women?
Guide these aged steps, my servants, forth before the house; support your fellow-slave, your queen of yore, ye maids of Troy. Take hold upon my aged hand, support me, guide me, lift me up; and I will lean upon your bended arm as on a staff and quicken my halting footsteps onwards. O dazzling light of Zeus! O gloom of night! why am I thus scared by fearful visions of the night? O earth, dread queen, mother of dreams that flit on sable wings! I am seeking to avert the vision of the night, the sight of horror which I saw so clearly in my dreams touching my son, who is safe in Thrace, and Polyxena my daughter dear. Ye gods of this land! preserve my son, the last and only anchor of my house, now settled in Thrace, the land of snow, safe in the keeping of his father's friend. Some fresh disaster is in store, a new strain of sorrow will be added to our woe. Such ceaseless thrills of terror never wrung my heart before. Oh! where, ye Trojan maidens, can I find inspired Helenus or Cassandra, that they may read me my dream? For I saw a dappled hind mangled by a wolf's bloody fangs, torn from my knees by force in piteous wise. And this too filled me with affright; o'er the summit of his tomb appeared Achilles' phantom, and for his guerdon he would have one of the luckless maids of Troy.
Ironically, all three countries were to a great extent on the "doing" end of that concept a millennium ago. If we could just get Norway and Denmark involved then this could be the all-Norse financial war.
Tora Tora Bora, Their women are the most baeutiful on the planet, alas their bankers not so much.
WAY TO GO ICELAND! I will be visiting your country for the first time because of your stance against this shit they are trying to pull against the population of your country who were not party to any of the shit pulled. I will come and spend my dollars before they are completely worthless.
Cash economy bitches. That's how you hurt the cunts the most.
To bad about giving up your guns. You might have found them useful in the coming days
Yes, way to go iceland. Stick it t the man.
I find it amusing to see how many people here are willing to take stand without actually having enough information to achieve an objective opinion. I am puzzled by reactions that seem to indicate that international communities are money hungry institutions, and should not bitch and moan about Iceland saying no to every single agreement so far. Yet, the whole reason for the need of such an agreement is because an Iceland bank was build on this whole money hungry principal to begin with. It is the same freaking reason why Icelandic people voted "no"; it would cost them too much money.
What I mostly read here is people saying that it is okay to make money, live in health and wealth for years, decades, and when it's time to take responsibility,... it is perfectly fine to only take partial responsibility,.. or none at all. It's okay to steal and not do time when you're caught. You have to be totally retarded to think the Icelandic people are victims, and that it's okay for millions of tax payers in the UK and the Netherlands to pay for something Iceland has benefited from for years and years.
In the end, not paying back 100% (and 100% is more below the line when you take inflation into account) is not acceptable. Iceland more than deserve its Junk Status,.. it also should be rewarded with a full boycott from the international community. Iceland was one of the richest countries on the planet for decades, I'm pretty sure they can get used to live with a little more modesty and less wealth. This is a matter about not being willing to take responsibility. If 93% reject another agreement it means that 93% are willing to face international results because they're afraid their little Icelandic wallet might look less full. What about the wallet of the millions of British and Dutch tax payers? Let them just pay for and Iceland mess? Very realistic.
Hey old son they owe 20,000 euros per man women and child and they just said we can't pay'
If your an American, the sad news is you owe 6 x more and your on the hook for it. Now what are you going to do. Your going to wake up one day in a land you don't own, in a house you don't own and without a voice to cry foul ball. How that will feel I can only guess. Maybe a bit like Alice in Wonderland.
I can only wonder at the Roman Empire and the peoples thoughts as they found out - no ones got your back your on your LOANsome. Personally I think if you scream at the top of your lungs from a High building they will think you a terrorist and shoot you dead. That would be a Win Win situation for all. But In reality you and 325 million decent freedom loving Americans need to grow some testicles and stand up and say " I mad, I am Mad as hell and I'm not going to take It any more" Maybe Network was your Nadir and then you turned off the Video and went to sleep in your Simmons fluffy bed. Sad really = reality is not the ending you hoped for or expected
That made no sense at all. It didn't even scratch the surface of "sense". And apart from that, I am not American, so your whole incoherent rambling holds no ground. So put your history, Wonderland and terrorists back into your little trick bag and start getting some facts before you speak. After that, feel free to play with your testicles.
Basically things can be broken down very simple; If a government fucks up, it is responsible. The people that voted that government into power, are DIRECTLY responsible for the actions of that government. They trust their government with big discussions and choices. If that government fails, the people are still responsible. The fact that the result of unfortunate events might be dramatic for some families, does not mean that the country as a whole can walk away from this, just because someone said that EVERY Icelandic person has a debt of 20.000 Euros. That is simply twisting facts in order to win national and international sympathy. It's a shame many people are pathetic enough to fall for that.
It's nice to be sympathetic,.. but this is about taking responsibility. Iceland has profited from the financial sector for a long time, and so has its population. You don't think they became one of the wealthiest countries on the planet by selling fish, do you??
If I am going to stand up for myself and say something,.. I am going to scream that I am not going to take it anymore,.. from these Icelandic robbers that took my hard earned tax money. But then I guess I would be just as bad as some Icelandic inhabitants I guess,.. I would be looking at my own wallet instead of what is right or wrong. Iceland is biting itself in the ass right now. Let's hope they like fish over there,... seems like it's going to be on the menu for a long time. Business is not likely to target Iceland when it keeps portraying unreliability and instability.
Hey old son they owe 20,000 euros per man women and child and they just said we can't pay'
If your an American, the sad news is you owe 6 x more and your on the hook for it. Now what are you going to do. Your going to wake up one day in a land you don't own, in a house you don't own and without a voice to cry foul ball. How that will feel I can only guess. Maybe a bit like Alice in Wonderland.
I can only wonder at the Roman Empire and the peoples thoughts as they found out - no ones got your back your on your LOANsome. Personally I think if you scream at the top of your lungs from a High building they will think you a terrorist and shoot you dead. That would be a Win Win situation for all. But In reality you and 325 million decent freedom loving Americans need to grow some testicles and stand up and say " I mad, I am Mad as hell and I'm not going to take It any more" Maybe Network was your Nadir and then you turned off the Video and went to sleep in your Simmons fluffy bed. Sad really = reality is not the ending you hoped for or expected
Way to go, Iceland! http://www.youtube.com/watch?v=KOqk_q4NLLI
Iceland's people have said no.
That should be the end of the discussion. The Netherlands and British should bear the costs - all of them - of their own decision to bail out their citizens. That decision was uniquely theirs and did not come with the consent of the Icelandic population - a consent that was belatedly sought and now has been overwhelmingly rejected.
That is the beginning and end of the discussion.
If that decision is not respected, and Iceland's parliament continues to try to subjugate the people to pay for an act they were not responsible for, then the people must rise and put a stop to it, in its entirety.
By whatever means are necessary.
To the people of Iceland:
You have my full and unwavering support. Do not knuckle under. These banksters - these criminals - attempted to steal your economic futures, dreams and hopes.
They intentionally and with malice aforethought put together financial programs they knew could not succeed in the long term, believing they could saddle you with the costs while keeping the benefits to themselves.
You have repudiated that belief.
You are a beacon of light in a world of darkness.
Now finish the job and send these jackals - these robber barons, brigands and thieves - packing. Eject them, and the ruin they bring, from your nation now and evermore, replacing them with sound, local, and accountable financial institutions that are not run for the sake of bubbles and cute mathematical models but rather on sound principles such as ONE DOLLAR OF CAPITAL.
May this vote be the start of an international citizen revolt - peaceful revolt - against the brigand-style fraud rained down upon the word by the pinstripe-wearing scam-meisters known as "banksters."
@#257389
Ahhh, so it is okay for people from Iceland to enjoy the fortune (banks, including national banks, really do pay taxes, taxes benefiting Iceland and its inhabitants) but they don't have to take responsibility when things turn out bad? Even though we're talking about a public national bank: Landsbanki?
You state that tax payers of the Netherlands and the UK should pay up for the mess some other country left them with. Taxes that comes out of the pockets of families that, just as much as Iceland families, have to deal with a economic crisis. Quite a few families that can't spare that kind of money.
By your definitions it would also be okay for the UK and the Netherlands to invade Iceland, forcefully strip it completely from whatever it may have,.. just as long as it has the majority of the votes from of the UK and Dutch population. Your statement seems to bypass any logic and reason when it comes to international legislation, law and relationship.
Of course you can support Iceland, that's your right. And yes, banking has messed up a lot for everyone, globally. Why should everyone have to suffer from what banks do globally, everyone except Iceland? Iceland that has benefited from international finances,.. each and every person in Iceland. Directly or indirectly.
Your support is based on double standards it seems. You are willing to sacrifice victims that have nothing to do with this matter at all, victims that never gained anything from what happened in Iceland. Yet, you state that it is okay for Icelandic citizens to not pay back anything (you claimed the Dutch and British tax payers should be paying back everything, each and every one of them) and to let other people suffer from this international theft.
In a way I hope you get what you want. Iceland would become an international example of what can happen to a country when it allows its financial system to become a black hole and then refuses to take responsibility internationally. You speak about an "international citizen revolt" while clearly not being able to comprehend the international consequences it will have. You blame bankers and then convict innocent tax payers from a different country. You totally bypass the fact that each and every Icelander has benefited from this financial fraud, and portrait them as "the victims".
If Iceland doesn't clean up this mess properly, then I think it is very likely that they will have to deal with a far bigger (financial) problem than facing the debt they have now. If you don't understand what I am talking about you may want to look into what is actually going on before you write another little statement based upon little more than sympathy for the poor people of a country that until recently belonged to the top richest countries on the planet. Your little rant does nothing more than legalize international crime and theft, just because people can vote. It does nothing more than undermine credibility and financial liability of a nation,.. just because it seems the sympathetic thing to do. Well done.
I'm curious to see what will happen next. It's going to be fun to see Iceland twist itself into the stone ages because they only care about the short term status of their own wallets while trying to do what is really right (hey, wasn't that what the bankers did too???). Let's vote a few more times, it's gonna be fun. I wonder how long it will take before we see Iceland on Ebay. Probably won't happen before all international assets are sold and/or frozen. I seriously love the tunnel-vision some people have, it's amusing.
You still haven't convinced me as to why the Icelandic citizens should personally pay the debts of a failed bank.
@#257460
That's most likely because you have not taken the time to look up some facts about how the whole financial structure roots in this matter, and because perhaps you may have little understanding about how a government acts on account of the people that put this same government into power. Even when a government does something the majority of the people won't agree with, the entire nation ends up paying for these actions. If you don't like that fact, you should vote for a government that will allow you to not pay taxes, for example.
If you start investigating the icelandic case, it is pretty clear that the whole scheme was implemented to benefit the Icelandic population, a population which has to import a lot of basic goods and lives on the fringes of a consumption sink.
They implemented that carry trade stuff and also an exit strategy. Both benefited largely to the Icelandic population, way beyond the simple taxes on banks.
The carry trade allowed the Icelandic population in their recent standard of life.
Twenty years ago, the issue for Iceland was simple: either they resigned themselves in not being able to compete for goods with the big consumption monster living at the gates, living an impoverished life or they took action to counterbalance the influence of the big monster.
They went for option 2.
And they did well in the doing.
What they are going to be forced to repay is only a fraction of what they have already pocketed in.
I disagree with your position because it ignores the following:
1. The amounts paid by the UK/Netherlands to many of their citizens/depositors exceeded the amounts covered by the relevant deposit insurance.
2. According Spiegel's 5 March interview with Olafur Eliasson, who organized the campaign against the compensation plan:
EDITED TO ADD:
This was directed to post #257432.
@#257881
You can disagree all you want. Fact remains that Iceland agreed on paper to pay back, and has signed for it. They backed out. The bank in question has falsely advertised transparency and reliability. Iceland is portraying itself as a nation that can't be trusted, and sadly that is an accurate reflection of reality.
Assets should have been frozen and seized the second Iceland broke contract. And I am not just talking about Landsbanki assets. I just hope the Dutch and UK governments will take actions to do so, far beyond what has been done so far.
Have a look at what the person above you stated; it displays why I have strong feelings about not letting Iceland off the hook. Iceland has twisted itself into this position BY CHOICE, no one forced Iceland.
If Iceland signed the treaty so they had access to other EU countries then they should pay up. I know it would make me angry if I was them but they voted in the politicians who let the banks do what they did so who is ultimately to blame.
To put it another way. If I let an idiot run my company and it went broke who should I blame. Me or the idiot.
Declare Independence
http://www.youtube.com/watch?v=4P5xSntVWQE
This is a giant step for slave-kind and a surprising good bit of news! If their politicians move forward against the referendum, I hope they get more than red paint.
Just say no to slavery!
This is so easy, I really am shocked.
WE SHOULD ALL DEFAULT IS THE POINT, NOT JUST ICELAND. FUCK THE BANKERS.
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