Since the end of 2008, Iceland’s banks have forgiven loans equivalent to 13 percent of the gross domestic product, easing the debt burdens of more than a quarter of the population. According to Laes Christensen, Chief emerging markets economics at Danske Bank A/S in Copenhagen “Iceland followed the textbook example of what is required in a crisis. Any economist would agree with that.”
I will start off the paper discussing Iceland’s economy and what lead to their economic meltdown and how large a role forgiveness of debt played in helping them to recover. The second part of the paper I will discuss what America did in order to recover from the financial crisis and what experts said about forgiveness of debt, both good and bad. I will also add my own opinion and tell who I agree with and why.
I will conclude my paper with how President Franklin Delano Roosevelt forgave debt to help America recover from the depression in the 1920’s and what financial experts said about his decision to do so.
OK. Tell me ASAP what your argument is. Debt forgiveness is a technical topic, but interesting one. Hope you can find your own argument on the different levels of debt forgiveness in Iceland and the U.S.
hmmm, I am doing more research and I see that Iceland also nationalized the banks and did not bail them out which is the opposite of what the United States did. I also see they accepted money from the IMF and issued a series of government imposed capital control. I also learned Iceland instituted a recovery program that Paul Krugman and the IMF have praised.
Also, something that correlates to what we learned in class is the fact that Iceland’s economy is growing rapidly because there is an increase in consumption, investment and exports. One of the main reasons for the growth is the fact that the weakness of the Icelandic currency has lured tourists. I am looking through all of these things to try and come up with a provocative argument. Maybe something to do with the positive effects of nationalizing the banks and not bailing them out. Or maybe the details of the recovery plan they instituted.