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„Iceland best place to live, Africa worst – UN“ Reuters 2007<br />ICELAND CrisisLauri Läänelaid<br />
Iceland<br />HDI 2007 – 0,968, 1st. Norway and Australia followed<br />GDP per capita 2007 – 64 190 USD<br />Easy access t...
Estonia<br />HDI 2007 – 0,883, 40th<br />GDP per capita 2007 – 15 578 USD<br />
Business Vikings<br />Jon Asgeir Johannesson – establisher of Baugur Group<br />Lydur and Agust Gudmundsson aka „The Bakka...
The scheme<br />Bankruptcy<br />Loans money<br />No money for depositors<br />Buys bills/notes/bonds<br />No money to pay ...
The Baugur Tragedy<br />No money for depositors<br />Loans money to<br />Jon Asgeir Johannesson<br />Invests into<br />Lan...
The inflation rate<br />
The scenario<br />Risky loans by Kaupthing, Landsbanki and Glitnir (debt in excess of €50 billion)<br />Local household de...
The scenario<br />Global financial crisis<br />"Iceland is on the brink of collapse. Inflation and interest rates are ragi...
The consequence<br />Enterprises bankruptcy – locals lose their jobs<br />UK and Belgium depositors have lost their assets...
Solution<br />Never trust Icelandic banks?<br />
Solution<br />Loan from IMF<br />
If there are any questions don`t hesitate to ask!<br />
Thank you for Listening<br />
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Iceland

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Iceland

  1. 1. „Iceland best place to live, Africa worst – UN“ Reuters 2007<br />ICELAND CrisisLauri Läänelaid<br />
  2. 2. Iceland<br />HDI 2007 – 0,968, 1st. Norway and Australia followed<br />GDP per capita 2007 – 64 190 USD<br />Easy access to money provided by Banks<br />Strong insurance policy (2 pension schemes, health insurance etc)<br />
  3. 3. Estonia<br />HDI 2007 – 0,883, 40th<br />GDP per capita 2007 – 15 578 USD<br />
  4. 4. Business Vikings<br />Jon Asgeir Johannesson – establisher of Baugur Group<br />Lydur and Agust Gudmundsson aka „The Bakka Brothers“ – establishers of Bakkavor and controlling stakeowners in Exista bank<br />Bjorgolfur Gudmundsson - Iceland's second businessman worth more than a billion dollars, ex-chairman of Landsbanki<br />
  5. 5.
  6. 6. The scheme<br />Bankruptcy<br />Loans money<br />No money for depositors<br />Buys bills/notes/bonds<br />No money to pay back loan<br />No money to pay to creditors<br />Buys capital or expands<br />
  7. 7. The Baugur Tragedy<br />No money for depositors<br />Loans money to<br />Jon Asgeir Johannesson<br />Invests into<br />Landsbanki calls in <br />1 000 000 000 £<br />e.g. Hamleys, House of Fraser, Goldsmiths<br />No money to pay back<br />
  8. 8. The inflation rate<br />
  9. 9. The scenario<br />Risky loans by Kaupthing, Landsbanki and Glitnir (debt in excess of €50 billion)<br />Local household debt -> inflation -><br />High prices -> high interest rates (15,5%) -><br />Foreign depositors (Icesave, Kaupthing Edge)<br />
  10. 10. The scenario<br />Global financial crisis<br />"Iceland is on the brink of collapse. Inflation and interest rates are raging upwards. The krona, Iceland's currency, is in freefall„ The Guardian, 5 October 2008 <br />Run on deposits in the UK (300 000 UK savers)<br />
  11. 11.
  12. 12. The consequence<br />Enterprises bankruptcy – locals lose their jobs<br />UK and Belgium depositors have lost their assets<br />Britain declared Icelanders as „terrorists“<br />Thirdof the population consideredemigration<br />
  13. 13. Solution<br />Never trust Icelandic banks?<br />
  14. 14. Solution<br />Loan from IMF<br />
  15. 15. If there are any questions don`t hesitate to ask!<br />
  16. 16. Thank you for Listening<br />

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