Barry, My Liege;
In 2009, Iceland's government took over banks to help citizens. 25% of Iceland's population had home loans that were underwater. So, the government forced banks to forgive any loan amount over 110% of the home's current market value.
That was a debt forgiveness of 13% of GDP.
Additionally, the government protected all bank accounts in local currency with deposit insurance and let the owners of bank accounts in foreign currencies lose all value when the banks failed.
Result, Iceland will show nearly 3% GDP growth this year.
In Greece, bankers are in charge.
In fact, based on Iceland's experience, it can be argued that the policies in Greece will make the situation worse and not better.
The situations are not directly comparable, but do present opposite resolution strategies.
The banks which hold Greece's sovereign debt are reducing the debt by a number that is hard to establish in exchange for some cash to make debt service payments. Additionally, those bankers demand that public employment be reduced severely and that pensons be cut while taxes are raised. Youth unemployment is about 50%.
Nothing is included to help people find jobs or to grow the economy. Predictable result: GDP will decline further, there will be more riots and further debt problems.
It is reminiscent of Germany between the two 20th Century wars.
There is a simple lesson, My Liege: Do NOT let bankers run things.
Your faithful servant,