01:
00:00.00

{START}

{TITLE:
SONY PICTURES CLASSICS}

{The global economic crisis of 2008

cost tens of millions of people their

savings, their jobs, and their homes.

This is how it happened.}

01:
00:41.18

{ICELAND

POPULATION:
320,000

GROSS DOMESTIC PRODUCT: $13 BILLION

BANK LOSSES:
$100 BILLION}

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01:07.00

NARRATOR:
Iceland is a stable democracy with a high standard of living; and until

recently, extremely low unemployment and government debt.

ANDRI MAGNASON:
We had the complete infrastructure of a modern society; clean

energy, food production, fisheries, with a quota system to manage them.

GYLFI ZOEGA:
Good healthcare, good education; you know, clean air; uh, not much

crime; uh, it's good, a good place for families to live.

ANDRI MAGNASON:
We had almost, uh, end-of-history status.

01:
01:40.15

NARRATOR:
But in 2000, Iceland's government began a broad policy of deregulation

that would have disastrous consequences; first for the environment, and then for the

economy. They started by allowing multinational corporations like Alcoa to build giant

aluminum-smelting plants, and exploit Iceland's natural geothermal and hydroelectric

energy sources.

ANDRI MAGNASON:
Many of the most beautiful areas in the highlands, with the most

spectacular colors, are geothermal. So nothing comes without consequence.

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02:38.19

[BOOM!]

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Inside Job transcript – Sony Pictures – September 2010

2

NARRATOR:
At the same time, the government privatized Iceland's three largest banks.

The result was one of the purest experiments in financial deregulation ever conducted.

01:
03:09.20

{SEPTEMBER 2008}

DEMONSTRATOR:
We have had enough! But how could all of this happen?

GYLFI ZOEGA:
Finance took over. Um, and uh, more or less wrecked the place.

NARRATOR:
In a five-year period, these three tiny banks, which had never operated

outside of Iceland, borrowed 120 billion dollars, ten times the size of Iceland's economy.

The bankers showered money on themselves, each other, and their friends.

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03:35.27

GYLFI ZOEGA:
There was a massive bubble. Stock prices went up by a factor of nine;

uh, house prices more than doubled.

NARRATOR:
Iceland's bubble gave rise to people like Jón Ásgeir Jóhannesson. He

borrowed billions from the banks to buy up high-end retail businesses in London. He

also bought a pinstriped private jet, a 40-million-dollar yacht, and a Manhattan

penthouse.

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04:01.17

ANDRI MAGNASON:
Newspapers always had the headline: this millionaire bought this

company, uh, in the UK, or in Finland, or in, in France, or wherever; uh, instead of

saying, this millionaire took a billion-dollar loan to buy this company, and he took it from

your local bank.

01:
04:22.15

GYLFI ZOEGA:
The banks set up money market funds. And the banks advised deposit-

holders to withdraw money, and put them in the money market funds. The Ponzi

scheme needed everything it could, huh?

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04:33.05

NARRATOR:
American accounting firms, like KPMG, audited the Icelandic banks and

investment firms, and found nothing wrong; and American credit-rating agencies said

Iceland was wonderful.

SIGRÍ.UR BENEDIKTSDÓTTIR: In February 2007, the rating agencies decided to

upgrade the banks to the highest possible rate – AAA.

Inside Job transcript – Sony Pictures – September 2010

3

GYLFI ZOEGA:
It went so far as the government here traveling with the bankers, as a,

as, as a PR show.

01:
05:03.15

NARRATOR:
When Iceland's banks collapsed at the end of 2008, unemployment tripled

in six months.

ANDRI MAGNASON:
There is nobody unaffected in Iceland.

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