Thursday, October 09, 2008

What happened in Iceland?

BBC has a great analysis piece on what happened to cause Iceland to collapse. In short, inappropriate monetary policy and an outsized banking system made for a toxic combination.

Long terms prospects are good; short term prospects not so good with Icelandics seeing payments on loans increased by up to 50%, and inflation which may reach 30% or more this year, with salaries frozen and mass layoffs to come.

Stay tuned

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