Soldato
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Bad BBC, then
25% of Iceland voters don't want Icesave cash repaid to British savers
- Thread starter NathanE
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Argumentum ad populum
Just because a lot of people believe or feel something doesn't add any credibility or truth to the position.
Soldato
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The President has announced he wont be signing the bill. He'll hold a referendum on it: http://news.bbc.co.uk/1/hi/business/8441312.stm
Soldato
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No. What is unbelievable is the Government compensating UK savers above the insured £50k with money they don't have. The Government bailed out the well off here.
Well yeah there is a case for that. Especially as everyone from the UK who put their money in an Icelandic bank are morons in the first place
Well not exclusively. I gather many local authorities had millions saved with them, and that isn't their money, it's ours - yours and mine.
Soldato
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Soldato
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Perhaps.
I suppose I can't be mad at them for not wishing to pay it back, afterall they have to look after their own country and all. But, the government has made the right choice in paying back the cash. 2024 is a long way off though.
Soldato
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The Government has told local authorities they would not be getting that money back and had to write off the losses (local authorities are classed by the Government as informed investors). This is about individual savers, not institutions.
The Government used money it didn't have to bail out people with savings above the already doubled FSA insurance threshold (this includes people who took out mortgages on their homes here to invest in Icesave, because there was such a gap between the interest rates).
Iceland do not have the money to give to the UK Government - it will be borrowing it from the IMF.
It was a mistake by our Government to expect they would be getting compensation from Iceland for a decision it took to satisfy middle class voters here. Iceland is bankrupt, and our Government is bullying them into handing over their aid money. It is disgraceful, but typical.
Ah I didn't know that.
Not sure I agree here though. Icesave continued to take deposits right up until it closed, even though they knew full well they were about to go bankrupt, which strikes me as criminal and fraudulent.
The government are at fault here, and should not have guaranteed 100% of anyones deposits in Iceland, let alone any of it. Anything invested in a foreign bank should carry the risks with it that that status infers. People were chasing high dividends - with that comes risk. That is what investment is all about.
Quite right too, as does the governments guaranteeing the deposits without having the money to do so.
This I do agree with as it happens.
I don't understand why all of a sudden it is being perceived as mistake that our government guaranteed 100% of deposits.
This was a good thing.
The alternative of mass panic of people rushing to withdraw their monies from even legitimate and relatively stable banks doesn't bare thinking about. A number of British banks were inches from going completely bankrupt. The UK government was doing everything they could to retain whatever small amounts of confidence were left.
The problem is that, back in the pre-credit crunch, people actually "forgot" that banks could go bankrupt. Even the UK government seemed to have forgot. As evidenced by them recommending to councils to invest money in the high interest Icesave accounts. Which is another reason the UK gov. had to step in - otherwise certain councils would have had to skyrocket their taxes for 2009.
The only mistake the UK gov. made is in allowing Icesave to gain such market presence and power in the first place. At one point most newspapers were voting it #1, for instance.
This was a good thing.
The alternative of mass panic of people rushing to withdraw their monies from even legitimate and relatively stable banks doesn't bare thinking about. A number of British banks were inches from going completely bankrupt. The UK government was doing everything they could to retain whatever small amounts of confidence were left.
The problem is that, back in the pre-credit crunch, people actually "forgot" that banks could go bankrupt. Even the UK government seemed to have forgot. As evidenced by them recommending to councils to invest money in the high interest Icesave accounts. Which is another reason the UK gov. had to step in - otherwise certain councils would have had to skyrocket their taxes for 2009.
The only mistake the UK gov. made is in allowing Icesave to gain such market presence and power in the first place. At one point most newspapers were voting it #1, for instance.
British banks were already covered under the depositor protection scheme though.
People depositing in a bank outside the EU, not covered by depositor protection, and in a country with the GDP of my local chip shop were very stupid indeed.
I don't know how many times I need to say this, this deal was to cover the first 20000 euros that Iceland were legally responsible to cover under EU law. What our government decided to cover above the minimum legally required has nothing to do with Iceland, or the compensation we're seeking from them.
Indeed the decision to effectively gaurantee all deposits, regardless of value, was largely forced upon them by other countries doing that. Not doing so would have meant that depositors with more cash than the limit at the time could easily have taken the money out of UK banks (not a good thing, even at the best of times) and deposited it in other countries, Ireland being one of the main examples where this was likely to happen.
Questions must be asked why Iceland was granted an AAA credit rating in the pre-credit crunch years.