Ireland vs Iceland

ei.sdraob

economist has an article on us lot

it be hard for our politicians to say "at least we are not Iceland" anymore, they are well on their way to recovery and have dealt with the crisis in a democratic manner
the misery index is interesting



the kicking the can down the road approach is clearly not working

later12

Did David McWilliams say 'kicking the can down the road' in a lecture, or on the toilet or something? It seems to be the phrase du jour. In any event, I think these qualifiers are far more significant than the misery index

The weak krona, meanwhile, has increased the cost of repaying government bonds that were issued in foreign currency.

For all the euro’s faults, it is doubtful whether Icelanders would be keen to hold and use kronur if they were not forced to by capital controls. Easing these will be tricky. Local savers have little choice but to buy government debt, keeping yields artificially low. Firms and householders are overburdened with debts, some of which are indexed to inflation. House prices have plummeted, leaving many householders in negative equity. Around 40% of the new banks’ assets are non-performing. Not many Icelanders believe in recovery.

Sand

Firms and householders are overburdened with debts, some of which are indexed to inflation. House prices have plummeted, leaving many householders in negative equity. Around 40% of the new banks’ assets are non-performing. Not many Icelanders believe in recovery.

It lucky that none of this applies to Ireland.

The main difference between Iceland and Ireland is that it has done more to confront the underlying solvency problem. Ireland and the EU are still praying they have a liquidity problem. Once the Irish mortgage defaults begin, and pay cuts in the public sector continue and the government growth projections fail then the ugly truth will appear.

later12

Sand wrote: »

It lucky that none of this applies to Ireland.

It does, the point that such similarities exist should point pretty clearly to the fact that Iceland really ought not to be something we look up to. Nor can we as Eurozone members anyway, incidentally, but that's another issue.

karlth

We here in Iceland didn't take the medicine, we amputated.