So I promised I’d explain the reason why the government’s current “solutions” for the household debt in Iceland are useless. A regular reader to this site, Vilhjalm A. has pointed out the unique situation home-owners in Iceland are facing because of the consumer price indexation attached to all mortgages in ISK: An unnormal country In normal countries [...]

Today we went to our Kaupthing branch for the last time. Not because we are able to take our finances elsewhere as people in real economies do, nor because they were making us bankrupt because we aren’t. And it wasn’t because they had  an offer for us after we have paid almost 4 million in [...]

Where would the Icelandic banks be without the Icelandic taxpayers? Maybe having to renegotiate with their customers like BoA. I had a run in with one of the government’s chief advisers on the household debt issue. He told the truth, plain and simple and I don’t know why Arni Pall Arnason doesn’t just come out and say [...]

Frettabladid indicates today that all mortgages are to be taken over by the state run Icelandic Housing Financing Fund. The reason for this would be to ensure that if actions are taken to reorganize the debt of Icelandic mortgage holders, then there would be no danger of different treatment by different banks. Frettabladid also indicates [...]

Inflation in August was measured at 16% in Iceland. In the European Economic Area 0,6%. In the Eurozone -0,2%. Those mortgages that aren’t in foreign currency in Iceland are price-indexed with the consumer price index. In less than three years I have paid back 22% of the original loan amount on my mortgage. Yet the [...]

One should think that transparancy is of utmost importance for any Icelandic government since the heyday of the behind-closed-doors governance of the Independence Party and the Progressive Party. Questions remain regarding the true ownership of Magma Energy, which has now gotten its hands on valuable energy resources through a game of remiscent of previous governments. [...]

Bankruptcy is ahead on the marketplace of ideas as far as solutions to the massive debt facing Icelandic households is concerned. A fortress around the households in Iceland promised by the government has turned out to be one around financial institutions. The latest news claim that the foreign creditors of Byr S&L are writing off [...]

One of the main reasons that banks do not want to write-off home-loans is because it will reduce their “book value”. If the banks reduce their book value too much, then they are technically insolvent. If they are technically insolvent, then they cannot do normal business (such as making new loans), or else the government [...]

Now that the IceSave agreement is throught Althingi and Olafur Ragnar Grimsson has signed, sealed and delivered it onwards, the focus is increasingly pointing towards the so-called “fortress” that the government promised to build around Icelandic households during the parliamentary campaign last spring. It is now almost one year since the economic disaster with the [...]

So what is the bank going to do? Atli Steinn Gudmundsson, a journalist at visir.is and Bylgjan stopped paying off his mortgage in March. “I would have to be a CEO of a large company to manage all those payments. It came to the point where I saw no sense in continuing to pay” he [...]