I think Iceland has been doing all the right things, but the article paints a way too rosy picture of how Iceland did economically. They tanked a lot, unemployment quadrupled, inflation went to double digits, etc. and so it's natural that they aren't in free fall anymore two years after it hit. Still, inflation is still an issue and the krona is still very low.
The krona value nearly halving relative to the Euro means that relative wages (and other contracts fixed in krona) tumbled dramatically (and still unemployment quadrupled). If Portugal or Greece were not in the Euro that might have happened to them too.
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Originally posted by PalynkaWould Iceland have been better off doing as told?
I think Iceland has been doing all the right things, but the article paints a way too rosy picture of how Iceland did economically. They tanked a lot, unemployment quadrupled, inflation went to double digits, etc. and so it's natural that they aren't in free fall anymore two years after it hit. Still, inflation is still an issue and the krona is still very l ...[text shortened]... quadrupled). If Portugal or Greece were not in the Euro that might have happened to them too.
Or: is the example of Iceland one that other countries might do well to follow?
Originally posted by Bosse de NageProbably not, we'll never know, but I don't think it would.
Would Iceland have been better off doing as told?
Or: is the example of Iceland one that other countries might do well to follow?
The EU (and the IMF) is worried about the knock-on effects on its other members' banks, and Portugal and Greece too! Greek banks are packed with Greek debt, so defaulting is less of an option. Greece HAS to default partially (and clinically!), so it's not a position with a lot of choices. But all EU struggling countries would be much worse without the EFSF, so if not defaulting is a condition to access it, then not defaulting could be the best option. If the EFSF was not there, I'd be all for partial default for Portugal. Like this...not so much, although a bit of both would be the best option at this point.
Originally posted by Bosse de NageInteresting article but in the first paragraph inaccurately describes Iceland as a;
Sticking it to the banks:
http://sacsis.org.za/site/article/728.1
- Is this article a reasonable account, economists?
little-known member of the European Union
little known to the EU as well!