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Iceland Is Thinking Of Adopting The Canadian Dollar (and Canada might allow it to)
Business Insider ^ | 03/02/2012 | Adam Taylor

Posted on 03/02/2012 10:46:32 AM PST by SeekAndFind

Iceland is reportedly looking to ditch their unstable currency and adopt the Canadian dollar, the Globe and Mail reports — and Canada might let them.

Canadian ambassador Alan Bones is due to say tomorrow that if Iceland is sincere in its intention, the two countries should enter talks.

Ambassador Bones was reportedly approached last year by a number of prominent Icelandic businessmen.

The plan seems to be the latest unorthodox idea in Iceland's remarkably successful recovery. It may work as a prevention against the economic disaster in 2008, providing a stable and liquid currency, but would leave the country less in control of its own economy.

7 out of 10 Icelanders are reportedly in favor of the plan, but the official hope is currently to join the euro.

Read more details at the Globe and Mail >

(Excerpt) Read more at businessinsider.com ...


TOPICS: Business/Economy; Canada; Foreign Affairs; News/Current Events
KEYWORDS: canada; iceland

1 posted on 03/02/2012 10:46:37 AM PST by SeekAndFind
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To: SeekAndFind

ORIGINAL ARTICLE FROM THE GLOBE AND MAIL

SOURCE: http://www.theglobeandmail.com/report-on-business/economy/iceland-eyes-loonie-canada-ready-to-talk/article2356634/

EXCERPT:
____________________________

Iceland eyes loonie, Canada ready to talk

For 150 years, no country has expressed interest in adopting the Canadian dollar — the poor cousin to the coveted greenback.

But now tiny Iceland, still reeling from the aftershocks of the devastating collapse of its banks in 2008, is looking longingly to the loonie as the salvation from wild economic gyrations and suffocating capital controls.

And for the first time, the Canadian government says it’s open to discussing idea.

In brief remarks to be delivered Saturday in Reykjavik, Canadian ambassador Alan Bones will tell Icelanders that if they truly want the Canadian dollar, Canada is ready to talk.

But he will warn Icelanders that unilaterally adopting the loonie comes with significant risk, including complete loss of control over their monetary policy because the Bank of Canada makes decisions only for Canadians and the Canadian economy. He’ll caution, for example, that giving up the krona in favour of the Canadian dollar (CAD/USD-I1.01-0.004-0.35%) will leave the country with few levers, short of layoffs, to counter financial shocks and fluctuations in the loonie.

A group of prominent Icelandic business leaders approached Mr. Bones last year about the idea. And his speech Saturday, to a meeting of the opposition Progressive Party, marks Canada’s first public response.

The Bank of Canada, which referred all calls to the Finance department remains tight-lipped.

“We don’t speculate on another country’s currency or domestic issues,” Finance department spokesman Jack Aubry said.

There’s a compelling economic case why Iceland would want to adopt the Canadian dollar. It offers the tantalizing prospect of a stable, liquid currency that roughly tracks global commodity prices, nicely matching Iceland’s own economy, which is dependent on fish and aluminum exports.

There’s also a more sentimental reason.

“The average person looks at it this way: Canada is a younger version of the U.S. Canada has more natural resources than the U.S., it’s less developed, has more land, lots of water,” explained Heidar Gudjonsson, an economist and chairman of the Research Center for Social and Economic Studies, Iceland’s largest think tank.

“And Canada thinks about the Arctic.”

CLICK ABOVE LINK FOR THE REST


2 posted on 03/02/2012 10:48:15 AM PST by SeekAndFind
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To: SeekAndFind

Canada, the new empire.

Take that, biatch.


3 posted on 03/02/2012 10:49:27 AM PST by Jonty30 (What Islam and secularism have in common is that they are both death cults.)
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To: SeekAndFind

Why not? Panama and the Bahamas essential use the US dollar


4 posted on 03/02/2012 10:51:37 AM PST by therightliveswithus
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To: therightliveswithus

RE: Why not? Panama and the Bahamas essential use the US dollar

___________________________________

The more interesting question is this -— Why did Iceland prefer to adopt the Loonie and not the world’s de facto “reserve” currency, the US Dollar? (as if we don’t know the answer to that one ).


5 posted on 03/02/2012 10:53:41 AM PST by SeekAndFind
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To: SeekAndFind

Why not the obvious? A gold backed currency with gold & siver specie?


6 posted on 03/02/2012 10:55:08 AM PST by Bon mots ("When seconds count, the police are just minutes away...")
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To: SeekAndFind

siver specie = silver specie


7 posted on 03/02/2012 10:56:09 AM PST by Bon mots ("When seconds count, the police are just minutes away...")
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To: SeekAndFind
Iceland has a "Loonie" idea

(Canadian money joke)

8 posted on 03/02/2012 10:58:23 AM PST by tophat9000 (American is Barack Oaken)
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To: Jonty30
There's a beaver on the Canadian Nickel... Just in case anyone is interested...

9 posted on 03/02/2012 11:00:07 AM PST by BigEdLB (Now there ARE 1,000,000 regrets - but it may be too late.)
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To: SeekAndFind

As our friend from Chicago, Mr. Obama has said, “This used to be us.” /sarc


10 posted on 03/02/2012 11:00:46 AM PST by 92nina
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To: BigEdLB

It’s a noble animal.

It works hard and minds its business.

Much better than the turkey Ben Franklin wanted.


11 posted on 03/02/2012 11:02:57 AM PST by Jonty30 (What Islam and secularism have in common is that they are both death cults.)
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To: tophat9000
This is where the joke comes from - $1 coin. We get Susan B Anthony, they get a crazy bird.

12 posted on 03/02/2012 11:04:09 AM PST by BigEdLB (Now there ARE 1,000,000 regrets - but it may be too late.)
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To: SeekAndFind

Well heck at this point I might support reverse “Canadian Bacon” because Harper sure would be a better leader than both dopes Obama and Romney!


13 posted on 03/02/2012 11:10:55 AM PST by JSDude1
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To: BigEdLB
This is where the joke comes from - $1 coin. We get Susan B Anthony, they get a crazy bird

No...they get a crazy bird, we get an old bat

14 posted on 03/02/2012 11:11:37 AM PST by tophat9000 (American is Barack Oaken)
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To: BigEdLB

There's a beaver on the Canadian Nickel... Just in case anyone is interested...

Maybe we can buy Ms Flukes condoms with them...

15 posted on 03/02/2012 11:14:38 AM PST by tophat9000 (American is Barack Oaken)
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To: SeekAndFind

The Bermuda dollar and the U.S. dollar are interchangable in Bermuda. You can pay in either currency. Why don’t the Icelanders adopt the same policy, make their currency interchangable with the Loony? Call it the Íslandur Dollar?


16 posted on 03/02/2012 11:15:35 AM PST by Lonesome in Massachussets (Ceterum autem censeo, Obama delenda est.)
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To: BigEdLB

Hey, what does an American call the Canadian nickel?

The American dollar. :)


17 posted on 03/02/2012 11:19:55 AM PST by Jonty30 (What Islam and secularism have in common is that they are both death cults.)
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To: tophat9000

Beavers for beavers. Works for me. Can we get an address to send rolls of Canadian nickels to Ms. Fluke.


18 posted on 03/02/2012 12:05:54 PM PST by meatloaf (Support House Bill 1380 to eliminate oil slavery.)
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To: Jonty30
Hey, what does an American call the Canadian nickel?

Here's an oldie:

Since Carter was elected, what do we call our dollar?

The J.C. Penny.
19 posted on 03/02/2012 12:12:41 PM PST by Dr. Sivana (May Mitt Romney be the Paul Tsongas of 2012.)
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To: SeekAndFind

Translation: “Uh, we’re broke. Let’s go find us a Sugar Daddy.”


20 posted on 03/02/2012 12:29:19 PM PST by Moltke (Always retaliate first.)
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To: BigEdLB

And Wayne Gretsky is on the $5 bill.


21 posted on 03/02/2012 12:35:15 PM PST by Former Proud Canadian (Obamanomics-We don't need your stinking tar sands oil, we'll just grow algae.)
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To: SeekAndFind
I think the BOC should get on this right away. Just think, if we could get 10% of the seignorage the US gets, I can retire at 65. HOORAY.

This is actually a really good idea for Iceland. Their economy is too small to maintain a stable currency. If they can't become another Switzerland, and they can't, this might be the best choice for them.

22 posted on 03/02/2012 12:44:06 PM PST by Former Proud Canadian (Obamanomics-We don't need your stinking tar sands oil, we'll just grow algae.)
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To: Former Proud Canadian

Maybe the U.S. should adopt a stable currency like the Looney. Of course, in 1994, it was going for something US$0.69 for CDN$1.00.


23 posted on 03/02/2012 1:18:55 PM PST by Lonesome in Massachussets (Ceterum autem censeo, Obama delenda est.)
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To: tophat9000
Maybe we can buy Ms Flukes condoms with them...

LOL Ouch!
24 posted on 03/02/2012 1:35:14 PM PST by BigEdLB (Now there ARE 1,000,000 regrets - but it may be too late.)
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To: Lonesome in Massachussets

I know you are jesting. The tail cannot wag the dog.


25 posted on 03/02/2012 1:41:39 PM PST by Former Proud Canadian (Obamanomics-We don't need your stinking tar sands oil, we'll just grow algae.)
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To: Former Proud Canadian

In 1994 Canadian policies were so abysmal that the Looney really was grossly undervalued. This hurt the Canadians pride so much that they adopted sound economic principles, something that our poor country abandoned in 1932.


26 posted on 03/02/2012 1:44:38 PM PST by Lonesome in Massachussets (Ceterum autem censeo, Obama delenda est.)
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To: Lonesome in Massachussets
Yeah, that was when you were just coming out of 12 years of conservative leadership and we were getting killed by the liberals.

Funny how that works. Conservative=strong currency.

27 posted on 03/02/2012 1:44:43 PM PST by Former Proud Canadian (Obamanomics-We don't need your stinking tar sands oil, we'll just grow algae.)
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To: Former Proud Canadian
I had my sister move her money to a Canadian bank denominated in Loonies, she has dome well, the exchange rate was good at the time and Canadian Banking laws are Primo.
28 posted on 03/02/2012 1:56:49 PM PST by Little Bill (Sorry)
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To: Little Bill

A major bank has not failed or been bailed out in Canada since the 1920’s.


29 posted on 03/02/2012 2:04:49 PM PST by Former Proud Canadian (Obamanomics-We don't need your stinking tar sands oil, we'll just grow algae.)
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To: Former Proud Canadian

Bingo!!!!!!!!!!


30 posted on 03/02/2012 2:19:13 PM PST by Little Bill (Sorry)
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To: Jonty30

What is in it for Canada to do this?


31 posted on 03/02/2012 3:15:16 PM PST by tbw2
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To: tbw2

We’re in it for the sardines. :)

As far as I know, if a country wants to formally a foreign currency as their own, the host country can’t really say no. That was the situation in the 90’s when Quebec was voting to separate or not. It could have adopted the Canadian currency as its own and Canada couldn’t have said, “no”.

However, if Iceland does this, it would have no influence over Canada’s currency decisions. It would be just along for the ride only.


32 posted on 03/02/2012 4:00:18 PM PST by Jonty30 (What Islam and secularism have in common is that they are both death cults.)
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