http://news.bbc.co.uk/1/hi/business/7689633.stm

- Almost compelte collapse of Iceland's economy.
It caused serious ramifications here when roughly 500m was found to be deposited in Icelandic banks here in the UK through private savings and even local council savings.

But now a western nation going to the IMF? Is this the beginning of a trend?

I would hope not, Iceland was in fairly unique circumstances with the amount of its banks had leveraged compared to its GDP that in many cases exceeded the normal 2nd world IMF abusees. I would have hoped at some point their bankers would have seriously asked "Can 300 thousand people ACTUALLY be worth the 500 some odd billion we have floated?" and I think that's going to asked of them, possibly at the end of pitchforks depending on how this goes down.

But now a western nation going to the IMF? Is this the beginning of a trend?


Maybe Bush has just been waiting so he would not be seen as the 1st to do so.

We're not going to ask for an IMF loan because we'd never tolerate the regulatory changes they demand.

We're not going to ask for an IMF loan because we'd never tolerate the regulatory changes they demand.

Bush would have some set preconditions to accepting the loan, I am sure.

We'd never stoop to borrowing from the IMF, as long as Asia continues to buy our bonds.

http://news.bbc.co.uk/1/hi/business/7692017.stm

- And like dominos, it begins.

Supposedly the EU is a lot more susceptible to financial collapse because they have no internal mechanism like our Federal Reserve, though I can't find the article that I read that in. But it seems like a lot of those on the list in trouble are EU countries, no?

Europe definitely uses central banking. The concept originated there, not here.

A lot of European nations are on, and have always been on, tenuous financial footing. That's one of the big reasons the major players (Germany and Britain) and their mouthy French neighbors have been unhappy about extending EU membership to barely functional quasi-democracies in ex-Soviet territory, etc.

It takes decades to grow a meaningful capital base ... it took about three years to fake one in the liquidity flood.

'Supposedly the EU is a lot more susceptible to financial collapse because they have no internal mechanism like our Federal Reserve, though I can't find the article that I read that in. But it seems like a lot of those on the list in trouble are EU countries, no?'

- It is indeed more susceptible, as most of our industry since the 1940s have dissapeared, where once Europe was the "Workshop of the World" (though more specifically Britain), with the exception of Germany, we now depend heavily on financial services such as banking, shipping, insurance, trading, etc.
But it's deceptive to suggest Europe is taking the brunt of it, as a lot of countries in the EU are wobbling economically. Because, well, about three-quarters of the "Western World" are in the EU! :P

It's also a mixed bag. The quintet of trillion dollar economics: Britain, Germany, France and Italy, are under differing strains. Whereas the world recession has hit German exports hard, and British finance severely, it hasn't caused much stress to either France or Italy, who are fiscally quite conservative and have not risked as many assets on the world trading system as either Britain or Germany. But then you have the moderately wealthy countries such as Spain, Belgium, Netherlands, Sweden, etc, where you can again find mixed results as to how severely their economies are being affected.

As a "concept", however, the EU is being hit hard generally by the economic downturn. But combined, it has an economy slightly more wealthy than the US, something like a $14 trillion purchasing parity compared to the US's $13 trillion. So it is inevitable that the EU as a multi-state trading bloc is being hit hard, but individually it varies as to how severely affected each state is.

I believe it won't be more than a year before the European Central Bank straps some balls on and begins to act in place of the IMF, but on a purely European level. Indeed, I think the long since useless central farming subsidy fund, of some hundreds of billion dollars, should just be transformed into such a reserve immediately.

'Europe definitely uses central banking. The concept originated there, not here.'

- Indeed, it was born here, in 17th century Sweden, actually, followed very closely by the Bank of England and the creation of the National Debt in 1694.