CASTLE OF CARDS: Britain a Big Version of Iceland?

Discussion in 'Wall St. News' started by crash n burn, Feb 12, 2009.

  1. Iceland is bankrupt, the Icelandic Krona has collapsed ands remains frozen, and the economy has ground to a halt under the weight of the estimated $100 billion of credit crisis debt as a consequence of the collapse of the countries banks that is far higher than the countries pre-crash GDP of $14 billion. The country is now reliant on strings attached loans to be able to function as an economy to enable it to import goods and services. Whilst Britain is a long way from a similar fate, however all of the ingredients are there in that Britain has a more or less bankrupt banking sector, with liabilities far beyond the states ability to guarantee without a loss of confidence in all UK debt and a collapse in the currency. I.e. the bailed out RBS alone has liabilities of <b>£2 trillion</b>, and a asset gap of at least £600 billion, therefore in a worse case scenario would require a huge amount of loans and guarantees far beyond the pin-pricks to date seen in the £90 billion to Northern Rock and £40 billion of Bradford and Bingley. The Bank of England is the lender of last resort so as to prevent bank runs, however what happens <b>when the BoE is required to lend £5 trillion as a last resort?</b> The answer is currency collapse followed by hyper inflation.

  2. Crash + Burn + Revolt = Dark Ages?
    Gee, what a happy article.
  3. Lucrum


    I always thought that if time travel were possible it would be neat to visit the Dark Ages, among other times.

    Looks like I may get my wish after all.
  4. Keep that crossbow close at hand!:D

    Who'd a thunk that Iceland would be the canary in the mine?