Do As Iceland Did

As I have said many times before, there will come a time when Europe’s bankrupt governments will be forced to default on their debts and exit the Euro and do precisely that which they have been avoiding and I have been repeating year after year now:

An absolute and unconditional abandonment of any more bailout talks is highly necessary. Member states need to consolidate their finances, cut spending, trim down their obtrusive bureaucracies and cut their unsustainable tax burdens.

For many of them, after they’ve now unfortunately been digging themselves a deeper hole, default remains inevitable, and in Greece’s case it has already occurred.

Now the most popular tweet in Spain is #hagamoscomoislandia or “Do As Iceland Did”, and as Mish points out:

A Twitter search for “#hagamoscomoislandia” turns up a hit with titles in English but comments in Spanish.

Google Translation says the page is already in English. However, I cut some of the comments and translated them. Here are the results.

  • Not one euro for banks, prosecute the perpetrators of the crisis and a constitution written by the citizens!
  • Education + health budget in 2012: 5,397 million euros. Rescue Bankia: 7,000 million euros
  • Greece, under the control of the Troika, in bankruptcy. Iceland, after a revolution, Out of Crisis.
  • 7,000 million euros for Bankia? To begin, No. # # HagamosComoIslandia RescatemosPersonas
  • Trial of bankers and politicians, reappropriation of wealth plundered, new constitution and social justice

Default is the free market‘s solution to extreme insolvency. Do as Iceland did.

Related Posts:

ICAP Testing Trades In Greek Drachma Against Dollar

The WSJ reports ICAP Testing Trades In Greek Drachma Against Dollar:

NEW YORK (Dow Jones)–ICAP Plc is preparing its electronic trading platforms for Greece’s potential exit from the euro and a return to the drachma, senior executives at the inter-dealer broker said Sunday.

ICAP is the latest firm to disclose such preparations, joining the growing ranks of banks, governments and other key players in the global financial system whose officials are worried enough about the stability of the common currency to be making contingency plans for a possible break-up.

The firm has been testing systems that would allow dealer banks to trade the drachma against both the dollar and the euro, the ICAP executives said, cautioning that the measures taken in recent weeks were precautionary. They said the currency pairs would not be accessible for trading unless required by market events, and may never be used.

“What precipitated this were customer concerns about what would happen if a country pulled out of the common currency,” said Edward Brown, executive vice president in business development and research at ICAP.

The U.K. Chancellor of the Exchequer George Osborne said Sunday that the government has stepped up its own planning measures in recent months to be prepared for a possible collapse of the euro zone. The U.K. isn’t a member of the euro zone, but it is home to Europe’s financial hub and is the world’s biggest currency-dealing center.

It’s good to be prepared for the likely …

Related Posts:

Eurozone Breakup Inevitable?

Mish writes in Europe Out of Time; Differences Impossible to Untangle; Merkel’s Mind is Fried; Eurozone Breakup Inevitable; “Let the Euro Die”:

Is the Euro Worth Saving?

Regardless of what you or I may think, that question is where European voters come in. From that standpoint it does not look pretty.

German Chancellor Merkel, Spanish Prime Minister Zapatero, Italian Prime Minister Berlusconi, and Greek President George Papandreou will all be gone after the next set of elections.

French President Nicholas Sarkozy may bite the dust as well, and if he does it may be to a vehemently anti-Euro candidate.

All it takes is one government to say “to hell with this” and the whole mess unravels.

The current set of politicians all want to “save the Euro”. But what did the Euro buy Greece, Ireland, Spain, or Portugal except misery?

Even German and Finland voters wonder what it bought them.

Eurozone Breakup Inevitable

Merkel’s half-baked proposal raises more questions than answers. The market (and voters) will not possibly wait for details of her proposal to get hashed out. If this is the best Merkel can come up with, a Eurozone breakup is inevitable.

I think that a complete political breakdown of the European Union would be the best thing that could happen to Europeans. Ditch all European political institutions, but maintain the free mobility of persons, capital, and goods across countries, really the only positive aspect of the Eurozone project. Oh, and you want one unified currency that actually works? I know I’ve been saying this over and over again, but … how about a gold standard? Anyone?

Related Posts:

The Euro Has Failed

About 2.5 years ago I wrote:

The 3% ceiling won’t matter anymore from hereon. Consider the European stability treaty dead. One member state after another will violate the requirements. The fact that a bailout of some Euro states by others is discussed, just shows how torn this European Union really is, how severe its imbalances are. With discrepancies like these, it is completely unfeasible to maintain a currency union. The Euro will keep taking its beating for it.

The breakup of that currency union is now approaching at an ever accelerating pace.

Yesterday Mish issued a nice little note to Trichet:

Hello Mr. Trichet.

The odds 17 sovereign states “get their act together” quickly regarding a fiscal union is zero.

There is no agreement on Eurobonds even from Germany and France, so how are 17 countries supposed to quickly agree on that?

Finland and Austria want collateral, and pray tell why shouldn’t they? Is every country supposed to do exactly what you want?

Greece is going to default and you and your big ego made matters worse by refusing to accept that fact, so much so that you and the ECB failed to plan for it.

You want 17 countries to get their act together. How about one central bank, the ECB, led by you, get its act together and admit your policies have failed? How about the ECB coming up with a legitimate plan for dealing with it this crisis instead of illegally making demands on sovereign nations?

The market gave you fair warning on Greece and you refused to see it. Now the market has said “time’s up”.

Face the facts Mr. Trichet “The Euro has failed.”

Mr. Trichet, you better come up with a plan to deal with the aftermath, because odds of a Eurozone breakup are large and growing.

… actually, in my opinion the best thing that could happen to the Eurozone would be to for it to break up, and take those bureaucratic, corrupt, and destructive leviathans of the European Parliament, the Commission, the Council, and the ECB right with it and thus off the backs of Europe’s sovereign nations once and for all.

Related Posts: