[sphinx]

As long as Govt’s continue to guarantee investor’s profits, this will happen over and over and over again, at least the people of Iceland stood up for National Sovereignty and said “tough luck” to the banksters who duned them for payment

Uhhh ... I take it you think governments should default on their bonds?

The problem here, and ultimately in the U.S., is not private sector greed. It is government profligacy and sovereign debt. And the problem is, when the governments default, they'll take every bank down with them.

[padre35]

Uhhm

Default on bonds, or default on deposit insurance?

What has happened is banks would offer high interest rates on deposits, the money flows into the bank because the State is insuring the deposts, when the scheme collapses, and it will collapse, the people of the country are on the hook for the insurance.

The banksters leveraged the debt instruments using credit default swaps, as the situation worsened the cost of insuring the swaps went up, if there is no “insurance” then the spread for the bonds collapses rendering the State insolvent.

The Icelanders said “tough luck” and gosh, they seem to be doing alright, of course that also means their govt can no longer leverage their productive capacity to offer freebies for votes, but for me, that is a good thing.

[caww]

they'll take every bank down with them.

Then the rush on the banks will topple it all...which frankly won't be a bad thing in the long run for Greece who has a history long at defaulting. At some point let it fall and then elect officials who care about the nation..if possible in Greece?

[ctdonath2]

The choice is
- gov’t default on bonds
- confiscate far more wealth from citizens.

Both suck for good reason. Pick one.

Oh, you don’t have a half-million dollars to spare? Guess you’re opting for defaulting on bonds.