Iceland and the Loonie
Posted by Andrew Jackson under exchange rates.
March 8th, 2012
Comments: 5
Dean Baker has weighed in on the weird idea that Iceland might adopt the Canadian dollar. It is their decision to make, but I also don’t see much to recommend it.
Comments
Comment from Erin Weir
Time: March 8, 2012, 2:56 pm
But think of the seigniorage!
Baker makes a very compelling case for maintaining a sovereign national currency. However, if Iceland wants a larger and more liquid currency, I can see why it might choose the loonie over the Euro.
Comment from Purple Library Guy
Time: March 8, 2012, 3:14 pm
I dunno, those liquid currencies get all over your hands.
Comment from travis fast
Time: March 8, 2012, 5:48 pm
In virtue of being fully sovereign (having a national currency) they already have all the domestic liquidity they could ever need. Iceland and Greece is the relevant comparison. Greek citizens are being thrown under a bus and the former prime minister of Iceland is on trial.
“Haarde’s trial, which is the first of its kind to be conducted at the Landsdomur since the court’s creation in 1905, continued this week after lawmakers voted not to interrupt the proceedings. The case against him follows parliament’s 2010 indictment, which argued the former premier failed to protect Iceland from “grave” financial danger. Haarde is also being tried for failing to prevent the island’s three biggest banks from generating debt 10 times the size of the economy.”
Comment from Purple Library Guy
Time: March 9, 2012, 1:55 pm
Oh, that is so cool. We need more trials like that.
Comment from Paul Tulloch
Time: March 12, 2012, 11:09 am
With this kind of forex activity daily, you got to know there is a whole lot of currency manipulation ongoing. Hitching your wagon to the Loonie, who has a petro dollar would seem pretty unsettling to any country.
Are central banks flooding the markets in a frenzied devaluing race to the promised land of economic growth?
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