Who knew that Icelandic banks were doing the same kind of investing in mortgage backed derivatives as U.S. banks, and that U.K. consumers banked at Icelandic banks, and U.K. local governments invested in Icelandic bank investments. And who knew that Iceland’s banks became vastly bigger in deposits and obligations than the Icelandic government could support?
The BBC has written extensively on this mess and what it means. Iceland’s banking system and government could well declared bankruptcy which would set that nation’s economy back years.
It is but one tragic fall out of the world of infinite banking. Where investments become infinitely complex, and in most cases unregulated. Money is moving at infinite speed around the globe, in millions of transactions per second. How can ANY government regulate or monitor this? And that is without considering all the CRIMINAL movement of money.
Speed ‘governors’ will probably be needed to slow down the movement of money around the world, so that alarms, indicators, and firewalls can be put in place to warn and potentially stop things getting out of control.
It will need the best financial and mathematical minds to work together to come up with new standards. Will it happen? Who knows.