10-23-2013 Book Discussion: Deep Freeze: Iceland’s Economic Collapse
Wednesday, October 23rd, 2013
Chairs: Henry To, CFA and Anthony Mak, CFA
In Deep Freeze: Iceland’s Economic Collapse, economics professors Philipp Bagus and David Howden gives a front-seat row to Iceland’s seemingly rapid banking collapse and economic deterioration during the 2008 global financial crisis. Iceland was a thriving, modern economy by all accounts. Then one day, Icelanders woke up to find its three biggest banks nationalized, and its government bankrupt. Inflation reached 18% by the end of 2008, while Icelandic stock prices collapsed by 90%. Food disappeared off the shelves. Icelanders nearly starved if not for the kindness of its Scandinavian neighbors.
Mainstream media asserts the root causes of Iceland’s collapse were too much deregulation, too many greedy bankers, and too much speculation. The authors counter such conventional views with a rigorous defense of the virtues of the free market and laissez-faire policies. Moreover, the authors argued that excessive regulation of the Icelandic financial system caused major distortions and misallocations of capital, resulting in the eventual collapse of its banking system. Such distortions include: 1) an explicit guarantee by the Central Bank of Iceland (CBI), resulting in an existential moral hazard issue, 2) from 2003 hereon, a consistent easing campaign through lower interest rates and lower reserve requirements, and 3) the CBI’s slavish adherence to an unproven model for making monetary policy.
We discuss the authors’ case versus that of the mainstream media. Different views and objectives are appreciated and welcomed. Please join us for wine and cheese at the CFA LA Society’s office at the Biltmore on October 23rd for a stimulating discussion on the root causes of the Icelandic economic collapse. We just ask you to come with an open mind. There will also be a networking session before and after our book discussion.
*The author will not be in attendance
As a participant in the CFA Institute Approved-Provider Program, the
CFA Society of Los Angeles has determined that this program qualifies
for 1 credit hours. If you are a CFA Institute member, CE credit for
your participation in this program will be automatically recorded in your CE Diary.
Registration Links (Must register to attend)
CFALA Members: $10.00 (place cursor on amount for link)
Non-members: $15.00 (place cursor on amount for link)
Time: 6:00pm: check-in and reception with wine and cheese
6:30pm: book discussion
Location: Biltmore Court
520 S. Grand Ave., Suite 370
Los Angeles, CA 90071
Parking: Self-Parking at Pershing Square (located directly across the street on Olive St.): $10.00.
Central Library Parking: For information on discount parking rates at the library, please click here. Library validation required.
Dress Code: Business Casual