Iceland’s Economy now growing faster than the U.S. and EU after arresting corrupt bankers

[JDPriestly]

15. Can anyone explain to me what the difference is in the broad scope of things between

kiting checks and what Wall Street and the banks did leading up to 2008?

Here is what check kiting is:

Check kiting is a form of check fraud, involving taking advantage of the float to make use of non-existent funds in a checking or other bank account. In this way, instead of being used as a negotiable instrument, checks are misused as a form of credit.

It is commonly defined as intentionally writing a check for a value greater than the account balance from an account in one bank, then writing a check from another account in another bank, also with non-sufficient funds, with the second check serving to cover the non-existent funds from the first account.[1] The purpose of check kiting is to falsely inflate the balance of a checking account in order to allow written checks that would otherwise bounce to clear.[2] If the account is not planned to be replenished, then the fraud is known as paper hanging instead. If writing a check with non-sufficient funds is done with the expectation that they will be covered by payday – in effect a payday loan – this is called playing the float.

Some forms of check fraud involve the use of a second bank or a third party, usually a place of retail, in order to delay the absence of funds in a transactional account on the day the check is due to clear at the bank. Such acts are frequently committed by bankrupt or temporarily unemployed individuals or small businesses seeking emergency loans, by start-up businesses or other struggling businesses seeking interest-free financing while intending to make good on their balances, or by pathological gamblers who have the expectation of depositing funds upon winning. It has also been used by those who have some genuine funds in interest-bearing accounts, but who artificially inflate their balances in order to increase the interest paid by their banks.

http://en.wikipedia.org/wiki/Check_kiting

Check kiting can get you into big trouble. But when banks misrepresent to their lenders how much they have and spend way, way more, they get bailed out.