How Iceland Overthrew The Banks: The Only 3 Minutes Of Any Worth From Davos

Tyler Durden's picture

"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...

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Griffin's picture

There are some bankers and politicians in Iceland in jail already and some big fish on the frying pan.

The tax authority has also managed to claw back over 20 billion ISK from tax havens.


Big things have small beginnings

h0oS's picture

"Even a strong successful financial sector is in fact bad news if you want your economy to be competative in the sectors which really are 21st century innvoation areas" lulz sec :)

Conman's picture

Imagine if all those HFT algo programmers did something productive with thier lives, like making it faster for me to get porn and stuff.

luckylogger's picture

But, but, but, but... I thought the banks were doing gods work........... which makes them gods..???


May they all rot in hell !!!!!!!!!!!!!!!!!!!

Zigs's picture

The Lloyd giveth, and the Lloyd taketh away.

ZeroAvatar's picture

Looks like those babies could take 1st and 3rd in a wet t-shirt contest!

bania's picture

Grimson will BE the holographic pass, a la Princess Lea in Star Wars.

"Help us Ron Paul... you are our only hope."

Seasmoke's picture

Iceland must not like Jewish bankers.

Bravo Iceland !!!

booboo's picture

oh I'm sure the puppet masters have something up their sleeve to punish these barbarians for their defiance and no its not the "comfy chair"

Yen Cross's picture

 Most people discuss new ways to get screwed.  Let's get Smart and think about making rational good decisions.


      hIT THE STUMP/

francis_sawyer's picture



You know ~ That's a fucking AWESOME idea...

If that PUSSY ASS organization which calls itself 'ANONYMOUS' wants to create a TRUE SENSATION... Forget about all this DOJ hacking bullshit... HACK fucking JPMorgan & disable everyone's EBT cards... Only THEN would a TRUE revolution be upon us...

Put up or fucking SHUT UP bitchez [you 'ZERO COOL' mother fucking wannabe fucking fucks]...


espirit's picture

Or give them something in the order of six digits.

Movin' on up!

smacker's picture

I always find it difficult to determine what the underlying aims of folks like Anonymous and Occupy Wall Street really are. They may want the banks brought to their knees for criminality and Wall Street brought to heel, as most of us do. But whereas many of us want a return to honest free market capitalism, I believe the other groups want to introduce socialism...or extreme versions of it.

mess nonster's picture

36 degrees in Rekjavik. 22 where I am. No hot springs nearby for me.

moonstears's picture

Island(Iceland), a beautiful woman behind every tree (actually are many hotties there, but no trees)! Haven't been there in years, best to you, mess nonster!

ebworthen's picture

An on the sidelines interview via Al-Jazeera


A speaker on the big stage via CNBC

That says a lot, no?

Love it, perfect.

buckethead's picture

It does speak as to which global media outlets are willing to air narratives which don't necessarily align with those prescribed from 'higher up'.

Well done, Al Jazeera.

Whiner's picture


Artful Dodger's picture

Brilliant. He implicitly demolishes the financial sector as unproductive, saying how even in Iceland the banks pulled smart/innovative analytical professions away from other sectors, where they might actually accomplish something useful. Now they're back in those sectors, contributing to economic growth (according to him) rather than electronic financial instrument flipping.

Cabreado's picture

Brilliant, yes, but

let's admit Iceland is not USA,

and for starters...

he mentioned "enlightened democracies" as the context.

SmallerGovNow2's picture

So let us continue with the current banking system in the US since it is working so well?

DaveyJones's picture

how to overthrow the banks

1) get some balls

2) see #1


joego1's picture

Blasphemy! Sacrifice them on the holy alter of the squid! And bring me a virgin and a bottle of JD while you are at it Muppet.

neutrinoman's picture

It's the cartelization of banking under government backing that's the problem. The crisis led the Icelanders to detroy this cartel, at least within their borders. They let failure fail, but they also prosecuted fraud -- they recognized it *as* fraud -- we sort of did this 20 years ago in the S&L clean-up, under a conservative administration (Bush Sr.). What's gone wrong with us? The political class now loves debt, wants everyone to get deep into it, and looks the other way with the middlemen of debt (the bankers) go wrong, because they're backed by the central banks and political class. Watch Taleb's video on linked here on ZH.

... in the Ayn Rand world, TBTF wouldn't have existed in the first place -- the system would never have been so fragile and vulnerable to catastrophic failure. You'd have a gold standard. You couldn't inflate the base of money and credit the way Greenspan, Bernanke, et al. have done. And you'd have no central bank with the ability to create money and credit from nothing, with its purpose of propping up big government and the large banks.

hooligan2009's picture

apparently the national pastime of icelanders is lying to beware


from espirit below

LetsGetPhysical's picture

Shhhh... stop making sense. The fight club needs a feel good story. Don't upset the narrative.

Buckaroo Banzai's picture

Wow...great link. Guess things look a lot different from inside Iceland.

nmewn's picture

Thanks to hooligan & espirit...a little truth goes a long way.

Oldrepublic's picture

from fishing for cod to investment banking and back to fishing in one generation!


pherron2's picture

What I understand of Rands philosophy is that she would have NO regulation. If someone was successful in screwing others over, more power to them, though her contention was that they would eventually be discovered, and drummed out of business. She did not see it as any moral dillema. Greenspan ascribed to this philosophy, and proclaimed himself a devout Randian. So help me understand how a Randian society would prevent TBTF. (BTW, I think she was a dispicable kuhnt)

AgAu_man's picture

If one is sincere about "doing God's work", one also needs to observe the Lord's/Moses's "7 year debt Jubilee", where all remaining debts are forgiven.  I assume the modern interpretation of the Old Testament is that this debt-forgiveness goes beyond one's family or tribe. 


hooligan2009's picture

that would make the interest/repayment rate around 16% for this to work. (14% principal repayment + c. 2% on the average balance)

Cosimo de Medici's picture

This guy is as full of shit as anyone else at Davos, and all this kudos afforded Iceland is simply bizarre.

The real "secret" to Iceland's supposed success is:

1)  Find a way to hoodwink boatloads of capital into your tiny country (which is a third the size of Foxconn's workforce)

2)  Waste most of the capital, but use a portion of it to better the country's infrastructure

3)  Don't pay any of the money back to foreign depositers (the proverbial widows and orphans, by the way, not bankers)

4)  Find a socially acceptible scapegoat, so that all other Icelanders can ignore their own willing complicity in the scam.

Iceland is almost as "noble" as AIG (when it was still considering suing Treasury).  They're Jon Corzine writ large and sovereign.  They're as rancid and foul as that rotted shark flesh they champion as a delicacy. 

Cabreado's picture

"so that all other Icelanders can ignore their own willing complicity in the scam."

Perhaps you could provide an explanation, because, regardless of 1, 2 and 3 in any state (or State), your #4 pretty much requires one.


overmedicatedundersexed's picture

cosimo, two wrongs don't make a right, well then, bigger bonus for the bankers should make them repent.

your sense of fairness corzine would love , or is that you jon. good for iceland i say. you are confused but elegant in your dementia.


Cosimo de Medici's picture

Clearly you do not understand the genesis of the Icelandic collapse, and prefer a false idol to harsh reality. Your comment about Corzine makes absolutely no sense in relation to my comment, so I suspect that your comprehension suffers as much as your willingness to learn.

Corzine used others' money to his own ends, and when he failed he walked.  Icelanders used others' money for their own end, then when their bubble burst, the entire nation walked.  That they stuck their domestic bankers was just projection of their own sins on to a chosen few.  There are no heroes.  This article is just like an old Norse (or Icelandic) tale:  a myth.  They're all guilty.

linrom's picture

Wow. What a great page.


So what Iceland has really done was to shift all its BANK DEBT onto Icelanders and their descendants forever via price/ foreign currency indexation of debt owned to the banks.

Then while Iceland can boast that it has not implemented austerity, it has turned its citizens into debt-peons, including debtors' children.

What a feudal-debt model touted as success! Is it any wonder that IMF and bankers love it!

espirit's picture

You Sir, are worthy of quoting.

In a nutshell, so to speak.

tip e. canoe's picture

"Is it any wonder that IMF and bankers love it!"

exactly, all they have to do is throw some scapegoats to the mob and pretend like that's solving everything.   i'm sure they already have a list drawn up.

smacker's picture

That allegation was made by the Marxist buffoon Gordon "Jonah" Brown and can safely be ignored. He's a 100% certified nutter.

1C3-N1N3's picture

Badass Ragnars: Danneskjold, Benson, Redbeard, Grimsson...

alfbell's picture

Iceland is a frozen shit hole. Small population. No wealth, no assets and in the middle of nowhere. That is why they talk about the banking cartel as they do. But let some European country or the USA try something like that and the bankers will put on the full court press and kick ass.

Who's your daddy, USA? Who's your daddy, Europe? Who's your daddy, Japan and Canada and Australia?


kedi's picture

In a small country like Iceland, the people, politicians, bankers etc, are very close together. Close enough to really feel the effects of things. Anger, failure, success. The larger the country and population, the more insulated these groups are from each other's realities and the greater is the inertia of actions to reactions. You can't swing a dead bank in Iceland without hitting everyone. In the US, EU, etc, too many are too far away from the reality.

Acet's picture

That's why countries like Switzerland have things like Cantoons. It keeps Democracy nice and tight.

Above a certain ratio of voter-to-representative, Democracy stops being about electing the better man/woman to represent our interests and starts being about electing the most photogenic salesman with charisma who has the right connections to make sure he's portrayed in a good light in the Media.

When there are just 2-degrees of separation between you and any of the candidates, it's far more easy to find out if one is an asshole, is untrustworthy or has no ethics (you'll likelly know someone who has seen that person behave out of his/her salesman character) than when you have to make your mind purelly from seeing a carefully cultivated image on TV.

So what's been happening in most Western countries for decades now is that we've been electing the best liars and the ones with the least worry about deceiving their fellow men: the most sociophatic of the lot.

AgAu_man's picture

Having now actually watched the video, I have to wonder...

Using the dilapidated house theory (for a country's sovereign debt), the damage is either minimal enough to repair it, or you treat it as "irreparable" and you bulldoze it.  Then start fresh with a new house, and different 'contractor'.

Suspect that the Greek and Spanish 'houses' are so far gone, that the ppl there know better than to throw good money (more fiat debt obligations) after bad, and that it's time to let their house of fiat-cards collapse.  Of course, the other fiat houses in the EU -- especially in Italy are scared witless/shitless of this happening, as that would visit America's Fed soon after.  

So, even though Greece's debt is small enough for Exxon and Apple to pay it off, TPTB are sticking to their Ponzi.  In the meantime, TPTB are still controlling the Greek & Spanish 'debt' by controlling the talking points -- as always. 

You define & control the issues and talking points, you control the game.  /Well done MSM, well done Elite!  May the Farce be with you. /sarc off