Thursday, October 23, 2008

Alice in Iceland

Whenever we do a little research into the story about the Icelandic financial shipwreck, comedy gold ensues.

The Times of London tells us that the IMF is waiting to pass some cash to Iceland until they placate the Brits and their unfortunate savers, who put their little all into Icesave. Could this have anything to do with the anti-terrorism laws invoked by Junior Caesar (aka Gordon Brown)?

Many local governments and other organizations seem to have lost hefty sums of money:
About 300,000 British savers had accounts worth about £4 billion in Icesave, which suspended operations on October 7 and stopped customers from both depositing and withdrawing money.
But they're not the only ones that lost their shirt (link to a WSJ paywalled article):

German banks have bled billions of euros in the U.S. subprime-mortgage debacle. Now they face another potentially big bill from a costly misadventure in Iceland.

The Icelandic bet is the latest illustration of how German banks -- including once-sleepy regional lenders -- ranged far and wide in recent years in search of yield to escape stiff competition and low profit margins on their home soil.

By June of this year, before Iceland's spectacular financial meltdown, German financial institutions had lent $21.3 billion to Icelandic borrowers, according to the Bank for International Settlements.
My goodness, $21.3 billion. That makes the British loss look pitiful. Germany must now own a shit load of glaciers, volcanoes, and maybe cod.

Back in the good old days, when proto-Blog-Simple lived in Yrp, German banks were thought of as the most stable, conservative, dull, drab and dependable organizations that could ever exist. They made the Swiss look like anarchists. It does some credit to the filthy liars and thieves of Wall Street that they were able to seduce a nation's economic integrity, just with the promise of a little more money. Funny, huh?


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