Iceland's gross domestic product (GDP) shrank 2.0 percent in the second quarter from the preceding three-month period for an annual contraction of 6.5 percent, preliminary data from the statistics office showed on Friday.
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'Contrary to other countries in the region, quarterly growth in Iceland is probably going to remain negative for the rest of this year,' he added.
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Although the central bank sees the economy of the island of only 320,000 inhabitants contracting around nine percent this year and shrinking still further next year, there is little scope for reducing interest rates, currently at 12 percent.
There are a lot of fascinating things about the Iceland situation. I'm just beginning to follow it. Maybe others here know more and could write about it. Letting the banks fail is clearly not the end of the story when vast sums of money are owed to other countries or citizens thereof, regardless of what the Icelanders may want. The Iceland situation makes one ponder the meaning of national boundaries and sovereignty.
Update: Here's a link to a Vanity Fair article from April 2009 about Iceland's banking collapse and its response to it.
11 comments:
All I know is that my domestic loan payments have increased by 10% while prices have gone up 50-70%. I'm one of the lucky ones, though, who didn't take a foreign currency loan. Those have increased by 100% for a lot of people. Unemployment has skyrocketed and there's still the matter of scrounging up money to pay for Icesave. It's a muddled affair to say the least. Clearly this venture should never have happened in the first place. So who's to blame? The Icelandic government - and by extension the Icelandic people who had no idea this was going on - should shoulder some of the blame. But this didn't happend in a vacuum. These banks were the victims of a domino effect caused by the global depression. The UK slamming anti-terrorists laws on all Icelandic banks and freezing assets didn't help matters much. In the end we're a small country, we look guilty as sin and we don't possess the resources or the political clout to fight back. And so I'll be paying for the English and Dutch investor out of my government salary for, probably, the rest of my life. C'est la vie.
Thanks, Asta, for commenting here.
Can you point us to some good English-language sources for news about Iceland?
Asta, I'm looking at your blog (which I can't read) and I see/hear that you're a fan of Adam Lambert!
So much as been written on the subject that it's all become a bit confusing. This person has written quite a lot on the subject: http://icelandweatherreport.com/ and then there's http://www.icelandreview.com/
As for Adam Lambert - well, he was the reason I'd added your blog to my bloglines feed :) Your Cassidy post was linked to over at ontd_ai
Ah yes, I also have a livejournal where I tend to spout some less than intelligent things in English: http://theloa.livejournal.com/
Asta -- Well, welcome. I'm afraid you'll be disappointed if you come here for Cassidy or Adam posts. That's not the bread and butter here, and I try to refrain, even if it doesn't look like it to my blog brothers.
Huh. Didn't see the link to my Cassidy post at ontd_ai. Just as well.
I'll check out your LJ and thanks for the Iceland links!
What is David Brooks saying?
Write a post about what Brooks is saying, please.
1.I can't post 2. I'm not sure what he's saying, which is why I asked the question. You do it.
1.) Fix that. Or have Scooter or LJ fix that. (I don't think I can, but if I can, tell me how.) and 2) You're on your own. I don't care enough to re-read it or try to understand. I think he's saying that the one detail Obama gave reveals or dictates how several other details will have to go. It fits the narrative of Obama as practical politician who's not a crusader for causes.
On Brooks: http://www.huffingtonpost.com/david-fiderer/david-brooks-lies-on-heal_b_284440.html
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