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Iceland Wants To Adopt The Dollar... No, Not That One, The Other One
Not the US Dollar of course: why would the only country to successfully overthrow the chains of banker tyranny and default in their face want to ever have anything to do with the USD, the source of all the world's problems. No, the dollar in question is that of Canada. According to the Globe and Mail tiny Iceland, "is looking longingly to the loonie as the salvation from wild economic gyrations and suffocating capital controls...And for the first time, the Canadian government says it’s open to discussing idea. There’s a compelling economic case why Iceland would want to adopt the Canadian dollar. It offers the tantalizing prospect of a stable, liquid currency that roughly tracks global commodity prices, nicely matching Iceland’s own economy, which is dependent on fish and aluminum exports." Yes, yes, there are all the fundamental reasons, but more importantly, it is a huge slap in the face of those statists (and the United States of course) who keep repeating no matter the facts that the USD will never lose its reserve status. Here's a hint: it can and it will. And so much for the thought experiment of printing endless amounts of currency in non-reserve format and getting away with everything unpunished. Finally, there is this startling dose of reality from an earlier and calmer time, when S&P, back in 2006, released its long-term baseline scenario of sovereign debt ratings. This oddly prescient table speaks for itself.
And yes, reserve currencies come and go, not talking of Michaelangelo but of endless currency devaluation.
And some more from the Globe and Mail:
In brief remarks to be delivered Saturday in Reykjavik, Canadian ambassador Alan Bones will tell Icelanders that if they truly want the Canadian dollar, Canada is ready to talk.
But he will warn Icelanders that unilaterally adopting the loonie comes with significant risk, including complete loss of control over their monetary policy because the Bank of Canada makes decisions only for Canadians and the Canadian economy. He’ll caution, for example, that giving up the krona in favour of the Canadian dollar (CAD/USD-I1.01-0.004-0.34%) will leave the country with few levers, short of layoffs, to counter financial shocks and fluctuations in the loonie.
A group of prominent Icelandic business leaders approached Mr. Bones last year about the idea. And his speech Saturday, to a meeting of the opposition Progressive Party, marks Canada’s first public response.
Which is all well and fine, and congratulations to Canada, however remember that in a Keynesian world it is all relative, and the second one scale is tipped in your favor, it immediately starts the countdown on your own self-destruction, if one proceeds with reckless abandon. Such as the US.
So be careful Canada: with great power, comes great a desire to distribute wealth. And we have all seen what happens next.
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I, of course, understand why Icelanders want loonie but without fiscal union (as we already know), it will not work.
Although the local propaganda claim that Iceland did a right thing, the country is in deep shit (and rightly so: punishment for default) and the move is totally unrealistic ( just an act of desperation).
But Iceland didn't default. Their banks did. The bankers who ruined the banks are back working on the fishing boats and the economy is well on the way to recovery.
Loonie is still fiat, would of been jumping on my desk if Iceland went to the gold standard
In their situation, the best they could aim for might be an Aluminum standard, seeing how they have lots of it and only 2 tonnes of gold.
What is more interesting is that Iceland is already making the case that a solid reserve currency is needed, and the the USD is not doing the job already.
And this just in: DOW JONES
"Treasury to pay BAC, JP Morgan 171 Million In Withheld Foreclosure-Prevention Incentives."
Just keep pulling that slot handle Ben, just keep it up. What a pathetic state we are in.
I like Canada but this would probably be a mistake for Iceland. I've often thought that the only reason Canada seems somewhat "stable" is that the global banking criminals are too busy sucking the blood from the US and Europe right now. Simply more treasure to plunder there first. When the US and Europe are sucked dry, then Canada becomes an attractive target. The vampires will turn their attention to the Great White North and eventually destroy the Canadian Dollar as well. Then on to Australia?
Yipee! I'm gonna be rich! Reserve currency status for Canada!
Wo-hoo!
Eat our shorts! We've got Iceland! It's only the beginning! Soon our global empire will stretch across the earth! First Europe! Then Russia! China! All will fall beneath our mukluked feet! And the United States! (Soon to be known as the group of the 33rd provinces!)
Beer for everybody!
Herkimer
[IMG]http://i1229.photobucket.com/albums/ee480/SweetDoug/ReserveCurrencyCanad...[/IMG]
Nice chart Herkimer!
I'm gonna buy me some palm trees and coconuts!
Gold news...
Bad News: Last couple of days it is being widely reported that the PAGE (Pan-Asian Gold Exchange) has been scuttled and won't happen. A New York bank, with close connections to principles in China helped scuttle it. China may not want gold to go high in price until they accumulate more.
Good News: The principles of the exchange are determined, well financed, and going to press ahead and open a 1:1 physical gold exchange this summer anyway.
Yes, I heard the interview in the kingworld.com site. I wonder when they are going to start trading and what kind of backing they are going to have. The Chinese better be ready to grow some balls on these one. They certainly didn't on the PAGE initiative.
Makes no sense.
Why would they need the involvement of a Western bank when it's already in their interest to accumulate more before they open it? It is also in my personal interest, so why would that be the "bad news" for any ZH reader?
Secondly, "determination" doesn't count in China.
In the communist China, CCP determines you.
There was no "involvement" more like cohesion from central bankers through a new York Messenger. Needless to say that a fair price on gold would have put an end to the FIAT currency system sooner than later.
Bad news for ZH readers because many of us have been following with interest the development of PAGE for a couple of years now. It feels like a a defeat of sorts.
Determination doesn't seem to count anywhere now a days, but it is aligned with Chinese interests. Since the market will trade in RNB and, at actual fair value, it allows you to hedge the currency. In a way, they are backing their currency with silver for the time being. Also it is a step closer to become the reserve currency of the world. Think about it. Countries like Iran will be able to trade in RNB and hedge the currency against devaluations. Iceland is even thinking of adopting CND. This might swayed them to use RNB instead.
So the Queen will run Iceland too?
They don't have nearly the same pull since Freddie kicked off.
Well at least they had their "One moment in time."
Hum, let's ask Ecuador how is it going since they dropped their currency and made the USD the official currency of the country. Maybe, they should just issue an asset backed currency.
Actually Ecuador is doing pretty well. Own some property down there, and the roadbuilding and other infrastructure development going on is remarkable. And the Chinese are investing like mad in hydroelectric power, oil and mining. Not perfect, but where is? Delightful spring weather in Quito year round, oil exporter, seafood exporter, low labor costs, diesel fuel is $1 per gallon, regular gas is $1.46 a gallon, great coffee, great chocolate, beautiful flower exporter. Good medical care at a not-outrageous price. Good cell coverage even in most of the Amazon. You could do a LOT worse than Ecuador. Not having to exchange currencies avoids the 2% - 5% haircut from the financial sharks running currency exchange. Ecuador defaulted on some odious debt from a prior band of crooks in a prior government, and the sun still rose in the east the next morning.
The Chinese are happy to invest if US and European bankers are not. How have US and European bankers worked out for the Greeks? Ecuador has a lot of undeveloped gold, silver and copper resources that President Correa plans to get developed. I attended a speech he gave in Macas in December where he talked about mining being the future of the country, and a far less threat to the Amazon region than slash and burn agriculture.
Energy and food exporter, nice beaches, and never gets cold. Ecuador is doing fine, and already is a top draw for US retirees, who can live very comfortably on a modest retirement. With all their gold and silver mining potential, I could see Ecuador switching to an asset backed currency in the future once the US$ tanks. Glad I am in early.
Actually, I like Colombia for somewhat similar reasons. Basically that they are an asset based economy. Colombia has a tendency to go to the right unlike the rest in south America.
I admit that I have not been to Ecuador although I have heard that is very pretty. Correa might have a nice rhetoric but in the last few years he wrote a new constitution. I guess so he can re-elect himself which he did and now can get another term in 2013 until 2017. I would say that makes him as close to a dictator as it can be (ala. Chavez). Many countries allow bank accounts and transactions in dollars which take care of that exchange fee without having to give up their currencies. The US has been able to dollar export its inflation, but if it rears its ugly head Ecuador will get taken along like been tied to a sinking ship. There have been attempts to bring back the sucre without success.
I am actually from the region, and I have seen these type of "presidentes" before. It never ends well. I hope it works out for you. Good luck.
My local Timberland outlet adopted that one, not the other one today. Im down 83 of that one today
Canadian ambassador Alan Bones will tell Icelanders that if they truly want the Canadian dollar, Canada is ready to talk.
But he will warn Icelanders that unilaterally adopting the loonie comes with significant risk, including complete loss of control over their monetary policy because the Bank of Canada makes decisions only for Canadians and the Canadian economy.
Translation (politically incorrect version)
Canada is ready to talk (and tell you whatever the US wants us to to tell you). Adopting the loonie may look like an attractive option to the $US dollar, but in reality it comes with significant risk since the loonie (& Canada) is essentially owned/controlled by the US, though for appearances sake, we like to portray that we really are different & not beholden to our cousins to the south.
Like us, you would lose complete control over your monetary policy (again) because the Bank of Canada is run by Mark Carney (no relation to Art) who happens to be a Goldman Sachs alumnus, and accordingly, the BoC makes decisions on behalf of the US, er, I mean Canada & their economies.
You see, we lowered interest rates during the 2008 economic crisis to encourage people to spend & go much deeper into debt & it worked...now the average Canadian's debt to income is greater than their US counterpart was immediately prior to their housing & financial meltdown. Our housing markets are also at the same if not greater bubble levels than the US was before theirs burst, and unlike Fannie & Freddie in the US, CMHC, aka Govt of Canada is on the full hook for the guarantees on most of the mortgages written in Canada.
So, after digesting some of those facts, (keeping in mind the US example from 2008) you just may want to reconsider....
http://www.debtclock.ca/. Utopia?
Chump change Kito, was higher than that 15 years ago
Anyone who thinks Iceland will be allowed to go Loonie needs to remember two words:
Avro Arrow.
No matter how good the product, Uncle Sam will have the final say.
Damn you, you've gone and made me cry again...
Sorry, Al. It still makes me cry too. Oh to think about what could have been. The Avro Arrow put the US on the moon, and Americans to this day have no idea.
WOW WOW WOW!!!!
So everyone will be non-investment grade by 2040 except Canada!!!
And the US will be non investment grade in 2030!!!!!
Just like the likely fate of the Toronto Maple Leafs, we'll finally "win the thing" a decade or two AFTER the F'ing league goes tit's up.
Sniff.....................
Those idiots.
Has anyone read their new proposed constituion? Bunch of socialists and statist crap and now they want a foreign fiat currency instead of being smart and going with gold? Thoose poor poor suckers, they'll pay for these repeated mistakes soon enough.
If you are facing capital flight and your choice is to switch to using the US dollar, the Euro, the Japanese Yen, the Swiss Franc, the Danish Krone, the British Pound or the Canadian dollar the Canadian dollar might be a pretty reasonable choice.
I expect that Iceland could simply switch more or less unilaterally whether Canada wanted them to or not. Iceland is small enough and Canada is big enough that it would not even cause a ripple.
Canada has some overpriced real estate but most of the associated loans are government guaranteed. The debt to gdp ratio is not too bad and in any event a falling housing market would not have much effect on the currency.
In terms of volatility of the exchange rate, the exchange rate seems to be effected by three main factors:
1) China, and others, want to invest in Canadian resources
2) parts of Canada are dependent on exporting manufactured goods to the US
3) Canada exports oil - principally to the US but the price is driven by world markets.
Factors two and three probably counter act each other tending to make the currency more stable.
They're going to join the EU, so this story sounds weird, unless they realized the EU is a fascist state thats going nowhere and changed their direction.
The government should allow any currency, including PMs, to be used for payments.
--
http://www.euronews.net/2011/06/27/iceland-s-eu-entry-on-course-despite-...
but, but it can't be so... keiser says canada's gonna crash soon.. mind you, he's been saying that for years. how long can a guy be wrong about something and keep hanging on to it?... well, i guess even a broken clock is right occassionally, eh ! good luck with that prediction, max.
why not hte australian dollar? What is distance these days anyway?
uh, the US will see fit to overthrow the Icelandic gov to install another puppet gov
The one thing we Canucks are good at is selling ALL of our raw goods to anyone that pays. We don't know how to make jackshit cause we're too damn lazy. So we sell all of our shit and then when it is made into other shit we buy it back. We like shit just like everyone else in the world - loonies for shit - what a world.
Canada is currently experiencing its housing bubble, so it will be coming along shortly to join the insolvency club.
Steve will be able to buy Iceland hookers now...
http://www.youtube.com/watch?v=gKpjOEG8AOk
Go Alberta!
Yeah, I'm pretty sure that Canada is already pretty well versed in the science of wealth distribution. I might be wrong though.
anybody else see that the lenth of the bars in years are around the same length? Basically the US$ is hosed at least as a reserve currency.
We don't want you Iceland. We don't want the Fed or the Queen either.
Thx
Canada
Don Cherry says fuck Iceland - they can't check worth shit and won't fight.
Iceland knows a good country when they see one...
Tragically Hip + Don Cherry + Trailer Park Boys = Classic
Not a huge fan of this specific tune, but watching Don smack Ricky was good stuff
http://youtu.be/s_DR45Mtrsg
FLY some "XAU" into that volcanic shit hole. Oh. I'm long lava tubes and stalactites!
That shit hole remindes me of that never ending underground( coal) fire in Pennsylvania. Centralia
Can't Iceland go on the Diamond standard? Shit! It's a giant Kimberly Flute!
The Norwegian krone makes more sence to me.
Does this mean we invade Canada? It's about time. Let's get out of the Middle East and Protect our borders here. Canada is is run by the damned Brits and French. Let's invade before they build a big wall to keep us out. It's clear from immigration and demographic trends that Texas is someday going back to Mexico. With 'all of their resources and potential for cheap energy, I think I could move to Canada and put up with the cold weather. Great fishing up there. Lot's of beautiful, scenic places to hike and camp. We'd be foolish not to invade.
You already tried to invade Canada, exactly 200 years ago. The US lost, badly - Got the center burned out of the White House for your troubles.
It was the soundest defeat ever in US history. Its notably absent from US history books.
I dont think Iceland will adopt the Canadian dollar, this idea comes from a group of people who want Iceland to abandon currency restrictions, the most vocal one of this group is Heidar Mar Gudjonsson.
That guy went to New York in 2006 and met with Bruce Kovner and George Soros, after the meeting he sent a email to Bjorgolfur Thor Bjorgolfsson owner of Landsbanki bank, the one who had the Icesave accounts, saying "I just met with Bruce Kovner and Soros and it tempts them to attack the Krona".
Heidar was then working as CEO of Novator, a Bjorgolf Thor owned company.
This gang has done enormous damage to Iceland, and if you follow Bjorgolf Thor the entrepreneur´s tracks, Sweden and Russia seem to be the places tied to most of the scams.
4 former Bjorgolfur owned Straumur Burdaras investment bank emploees were arested Jan 2010 for fraud involving currency restricitons laws. This amounted to billions of kronur.
This company Aserta kept all its illegal gains in Sweden, where it was protected by swedish autorities.
Those guys are slowly but surely strangling Iceland to death.
Another connection is the Swedish ABB and the under sea cable, who Heidar insist will save Iceland.
If Iceland would adopt anoter currency she will loose the central bank and the ability to de value the currency when the next crisis hits, then Iceland will be in the same position as Greece.
canadian dollar beats us dollar in the ratings, no doubt.
http://www.jinrongbaike.com/ http://www.cnhedge.com/
Just keep selling 600,000.00 houses in the lower mainland an hour and a half's drive from Vancouver, where people are going to pay tolls to get to work. All whilst they drive their cars that they pay 2000.00 a year for insurance, 5.00 a gallon for gas, pay 12% sales tax and make 48000.00 a year. Yeah, sounds like it should all work out fairly well.
How unpatriotic of the Icies to reject the USD!!!
Cheers.
http://www.aintmymedia.com/