[SeekAndFind]

I remember this : Iceland had a referendum on the arrangements to pay back the UK and Dutch governments for bailing out Icesave depositors on Iceland’s behalf.

I believe Iceland’s new banks will not be in the market for several more years.

They’ll have to find work for 2,000 ex-financial people (the equivalent of us finding new jobs for 25,000).

Asset values and incomes are still way down, and Icelanders aren’t able to pay back mortgages and loans. All of the arrangements made in respect of the new banks and old debt are under legal challenge.

So, Just to re-affirm this again.

Iceland had a referendum on the terms under which they repay depositors of the banks. They are still going to pay the depositors.

Iceland faced the same decision we did:

Option 1: wind up the banks, tell the bondholders to shove it and deal with the depositors.

Option 2: keep the banks open, keep the bondholders sweet and deal with the depositors over a 10-15 period

In Iceland’s case, their deposit debt was smaller than their bondholder debt, so they took that option. The oppositive applied to us. Our deposit liability was much larger than our bondholer liability.

Iceland may still have to pay its bondholders, in which case it will have suffered a double-whammy.

[M. Dodge Thomas]

"In Iceland’s case, their deposit debt was smaller than their bondholder debt, so they took that option. The opposite applied to us. Our deposit liability was much larger than our bondholder liability."

Yup. Something lots of the 'Default, and let God sort them out" crowd seems to forget.

[DuncanWaring]

They’ll have to find work for 2,000 ex-financial people (the equivalent of us finding new jobs for 25,000).

Put them to work cleaning-up volcano damage.

It'll probably be the first honest work they've done in their lives.