I can sympathise with those individuals who tucked their savings away in Icelandic bank accounts and I am glad that the government has assured them that those savings will be reimbursed one way or another.
Equally, I endorse the government's hesitation about providing similar assurances to local authorities. health trusts, universities and charities rich enough to invest millions. These bodies employ professional advisers and have access to financial advice.
There were plenty straws in the wind to indicate the shakiness of the Icelandic economy. (Even this blog drew attention last May to one such.) What were all these professional advisers doing? Not a lot, it seems.
Furthermore, we have been here before. In the early 1990s, when the BCCI went bust, a number of local authorities (including the Western Isles Council as it then was) had substantial funds on deposit. Happily, most of these funds were recovered in due course but not before various directors of finance lost their jobs. I sometimes think that the intrinsic dullness of the accountancy and other financial professions attracts people who are not very bright. After all, what kind of intelligent teenager wants to grow up to be an accountant or a banker?
In any event, remember that if a proposition looks too good to be true it probably is.
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