Currently there appears to be an undercurrent of social instability not seen in Iceland in modern times.  To respond, we should examine five dimensions on the security spectrum which can be considered to be especially revelant in Iceland in the present. These dimensions are: -          Traditional Military -          Economic vulnerability and  instability -          Breakdown of [...]

If debt forgiveness benefits both equity and debt holders, why do debt holders not voluntarily agree to it? ·     First of all, there is a coordination problem. Even if each individual debtholder benefits from a reduction in the face value of debt, she will benefit even more if everybody else cuts the face [...]

“In 1929, 1930, and 1931 Britain could not act as a stabilizer, and the United States would not. When every country turned to protect its national private interest, the world public interest went down the drain, and with it the private interests of all” - Charles P. Kindleberger, The World in Depression 1929-1939 So how [...]

I’d be more sanguine about all of this if there were any indications that private, final demand is taking off — consumers, business investment, whatever. But I haven’t seen anything suggesting that sort of thing. The chances of a relapse into recession seem to be rising. I’d be more sanguine about all of this if [...]

The ubiquitous cranes have paused on the skyline, as if stuck in time. There are countless buildings half-finished, seemingly abandoned. In the swankiest new constructions – like the vast Atlantis hotel, a giant pink castle built in 1,000 days for $1.5bn on its own artificial island – where rainwater is leaking from the ceilings and [...]

It is a strange feeling to witness your country falling apart before your eyes. You first start to panic when you realise that there is nothing you can do to stop the crash. When the crisis hit Iceland’s shores last year the rock of the Viking economy proved to be nothing more than clear water. [...]

What would hurt Dubai’s reputation would be unequal treatment between domestic (or UAE, GCC, Middle-Eastern or Islamic) creditors and other creditors from the West or from the non-Islamic East.  If Islamic debt were to be interpreted by the Dubai authorities as debt instruments that give preferential treatment – non-contractual seniority – to Islamic creditors, Dubai’s [...]

Lets see what happens before predicting the apocalypse again but here is the story off the Guardian. “The crisis in Dubai has brought up speculation about how many more skeletons might be left in the cupboard,” said Richard McGuire, a strategist at Royal Bank of Canada in London. Graham Turner, of consultancy GFC Economics, said: [...]

Ohio Democrat representative Marcy Kaptur on the Wall Street Bailout

When our grandchildren ask us what we spent our money on then this graph should help. From Information is Beautiful