Two other countries with different fates

Both countries have similar names, both are islands and both went burst due to bank problems after 2008 crisis: Iceland and Ireland. 

Three years later, Iceland is performing much better and becomes a case of fast restructuring following huge banking losses (see WSJ article: In European Crisis, Iceland Emerges as an Island of Recovery). Here is the quarterly data for growth:

The weakness of Ireland versus Iceland recover is well shown by the continuous fall in private spending in Ireland, versus a continuous recovery of private spending in Iceland after mid 2010:

Medium term debt and deficit histories of both countries in next two figures:

Different fates in similar periods of time associated with different currency and policy environments for similar problems and histories. Once again, the same pattern as discussed in previous post.

Update, 30 May: the story from the employment rate point of view, a similar pattern:

(Source of data: OECD.StatExtracts)

(Update, 8 July: more about Ireland versus Iceland, in a post by Krugman:

• Iceland is a dramatic demonstration of the wrongness of conventional wisdom in these times. Ireland did everything it was supposed to; nobody would describe it as “healing”. Iceland broke all the rules, and things are not too bad.)