# 4th bank down (Icelandic economy mess) **URL:** \ **Category:** Miscellaneous and Personal Stuff I Must Share\ **Created:** [March 10, 2009, 2:27pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957 "2009-03-10T14:27:37Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![WormTheRed](https://avatars.discourse-cdn.com/v4/letter/w/bbe5ce/32.png) [@WormTheRed](https://boards.straightdope.com/u/WormTheRed)\ **Post date:** [March 10, 2009, 2:27pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/1 "2009-03-10T14:27:37Z")
So yesterday the government nationalised Straumur Bank\*, previously owned by Björgólfur Thor Björgólfsson (the son of the owner of West Ham). That means that all the big banks who were active abroad, are now nationalized. They fell because they couldn’t handle re-rolling debts of 33 million Euros. It also means the government has increased it’s debts even more, to cover for all the people who had money invested there. It remains to be seen how much more, but with the debt ratio being at about 10 times GDP it really doesn’t matter all that much anymore. In other news, they just released figures for trading in ISK\*\* in February; 4 billion ISK compared to 550 billion ISK in Feb 07. The ISK is a dead fish and it even seems letting it float freely (which they did from March 1.) hasn’t had that much effect, since nobody’s buying or selling. The Central Bank does about 30% of the trading in ISK, compared with under 1% before the crash. Also; the Central Bank rate is still 18%, inflation is still in double digits, unemployment is hitting 10% nationally (from below 1% a year ago) and I still can’t find a friggin job somewhere else. Just some happy news from the jolly island in the north. \*an investment bank, not a regular bank like the previous three. \*\*Icelandic Krona, not Interstellar Kredits ---
**Author:** ![Quartz](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/quartz/32/267_2.png) [@Quartz](https://boards.straightdope.com/u/Quartz)\ **Post date:** [March 10, 2009, 3:03pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/2 "2009-03-10T15:03:28Z")
Being unemployed really sucks, doesn’t it? Are Icelanders still using the Isk for everyday use? Or are they using dollars or Euros? ---
**Author:** ![Amp](https://avatars.discourse-cdn.com/v4/letter/a/6a8cbe/32.png) [@Amp](https://boards.straightdope.com/u/Amp)\ **Post date:** [March 10, 2009, 3:08pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/3 "2009-03-10T15:08:30Z")
Is it like Mad Max over there yet? ---
**Author:** ![WormTheRed](https://avatars.discourse-cdn.com/v4/letter/w/bbe5ce/32.png) [@WormTheRed](https://boards.straightdope.com/u/WormTheRed)\ **Post date:** [March 10, 2009, 3:17pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/4 "2009-03-10T15:17:11Z")
> [@Quartz](#): > > Being unemployed really sucks, doesn’t it? > > Are Icelanders still using the Isk for everyday use? Or are they using dollars or Euros? Yup, it really truly sucks ☹ And yup - everybody still uses the ISK, cause the gubment says everything will be ay ok in a little while. And it’s quite hard to get hold of foreign currency if you don’t export things yourself. > [@Amp](#): > > Is it like Mad Max over there yet? Not quite 😉 More like a resigned feeling of “whatever happens, happens”. ---
**Author:** ![gonzomax](https://avatars.discourse-cdn.com/v4/letter/g/e8c25b/32.png) [@gonzomax](https://boards.straightdope.com/u/gonzomax)\ **Post date:** [March 10, 2009, 4:02pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/5 "2009-03-10T16:02:24Z")
We are headed there too Worm. We are so big that it is moving like a glacier but our direction is clear. We poured billions into the banks to try and prime the economic pump, but the bankers are resisting the pressure to invest in the economy. We will have to nationalize to make the economy have a chance. The future looks grim. ---
**Author:** ![Sunspace](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/sunspace/32/1250_2.png) [@Sunspace](https://boards.straightdope.com/u/Sunspace)\ **Post date:** [March 10, 2009, 4:03pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/6 "2009-03-10T16:03:38Z")
So is Icelandair desperate for customers, or what? Their ads are still in the Toronto subway, and the more I think about it, the odder they seem: pushing Denmark as the destination and barely mentioning Iceland itself. ---
**Author:** ![WormTheRed](https://avatars.discourse-cdn.com/v4/letter/w/bbe5ce/32.png) [@WormTheRed](https://boards.straightdope.com/u/WormTheRed)\ **Post date:** [March 10, 2009, 4:17pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/7 "2009-03-10T16:17:58Z")
> [@gonzomax](#): > > We are headed there too Worm. We are so big that it is moving like a glacier but our direction is clear. We poured billions into the banks to try and prime the economic pump, but the bankers are resisting the pressure to invest in the economy. We will have to nationalize to make the economy have a chance. The future looks grim. It sure does… is there any place on the planet where it doesn’t look like it’s going to hell in a handbasket? I only read of gloom, everywhere I look. > [@Sunspace](#): > > So is Icelandair desperate for customers, or what? Their ads are still in the Toronto subway, and the more I think about it, the odder they seem: pushing Denmark as the destination and barely mentioning Iceland itself. Ha ha 🆒 Well, Denmark (Kastrup) is a gateway to the rest of Europe. Reykjavik is only a gateway to Denmark 😉 ---
**Author:** ![Sunspace](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/sunspace/32/1250_2.png) [@Sunspace](https://boards.straightdope.com/u/Sunspace)\ **Post date:** [March 10, 2009, 4:24pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/8 "2009-03-10T16:24:23Z")
> [@WormTheRed](#): > > It sure does… is there any place on the planet where it doesn’t look like it’s going to hell in a handbasket? I only read of gloom, everywhere I look. Well, Canada is only being mauled (ref: GM, Ford and Chrysler) instead of suffering collapse, so I suppose that’s ‘good’. Canadian bankers are notoriously conservative, and didn’t get into the whole derivatives thing much, so they haven’t needed a bailout at all. > [@WormTheRed](#): > > Ha ha 🆒 Well, Denmark (Kastrup) is a gateway to the rest of Europe. Reykjavik is only a gateway to Denmark 😉 Or if you look at it from the other direction, it’s a gateway to North America. 🙂 ---
**Author:** ![WormTheRed](https://avatars.discourse-cdn.com/v4/letter/w/bbe5ce/32.png) [@WormTheRed](https://boards.straightdope.com/u/WormTheRed)\ **Post date:** [March 10, 2009, 4:27pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/9 "2009-03-10T16:27:03Z")
> [@Sunspace](#): > > Well, Canada is only being mauled (ref: GM, Ford and Chrysler) instead of suffering collapse, so I suppose that’s ‘good’. Canadian bankers are notoriously conservative, and didn’t get into the whole derivatives thing much, so they haven’t needed a bailout at all. True! But with the oil-prices down so low, you guys all of a sudden stopped hiring furreners ☹ > [@Sunspace](#): > > Or if you look at it from the other direction, it’s a gateway to North America. 🙂 Also true. Which is why they’re advertising the NA destinations in Denmark 🙂 ---
**Author:** ![Sunspace](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/sunspace/32/1250_2.png) [@Sunspace](https://boards.straightdope.com/u/Sunspace)\ **Post date:** [March 10, 2009, 5:10pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/10 "2009-03-10T17:10:01Z")
> [@WormTheRed](#): > > True! But with the oil-prices down so low, you guys all of a sudden stopped hiring furreners ☹ Oil prices will go up again. At least there’s a chance for the west to catch up with its infrastructure needs and maybe ease its housing crunch in time for the next boom. > [@WormTheRed](#): > > Which is why they’re advertising the NA destinations in Denmark 🙂 Iceland: the bridge country. 🙂 Is it wrong that every time I see one of those ads, I think of you, instead of, say, some hot Icelandic babe? ---
**Author:** ![Dewey\_Finn](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dewey_finn/32/4222_2.png) [@Dewey\_Finn](https://boards.straightdope.com/u/Dewey_Finn)\ **Post date:** [March 10, 2009, 5:19pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/11 "2009-03-10T17:19:59Z")
Michael Lewis wrote an interesting [article](http://www.vanityfair.com/politics/features/2009/04/iceland200904) about the situation in Iceland in the new issue of Vanity Fair. Based on his description, I don’t expect things to get that bad in the US. He says, “In the end, Icelanders amassed debts amounting to 850 percent of their G.D.P. (The debt-drowned United States has reached just 350 percent.)” ---
**Author:** ![WormTheRed](https://avatars.discourse-cdn.com/v4/letter/w/bbe5ce/32.png) [@WormTheRed](https://boards.straightdope.com/u/WormTheRed)\ **Post date:** [March 10, 2009, 6:07pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/12 "2009-03-10T18:07:47Z")
> [@Sunspace](#): > > Is it wrong that every time I see one of those ads, I think of you, instead of, say, some hot Icelandic babe? Haha 🙂 I’ll give you a [hot babe](http://ha.is/editor/Image/Unnur%20Birna.jpg) to think about instead 😉 > [@Dewey\_Finn](#): > > Michael Lewis wrote an interesting [article](http://www.vanityfair.com/politics/features/2009/04/iceland200904) about the situation in Iceland in the new issue of Vanity Fair. Based on his description, I don’t expect things to get that bad in the US. He says, “In the end, Icelanders amassed debts amounting to 850 percent of their G.D.P. (The debt-drowned United States has reached just 350 percent.)” Brilliant article! A really good read and I’m sending it to all of my friends to read aswell. ---
**Author:** ![Sunspace](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/sunspace/32/1250_2.png) [@Sunspace](https://boards.straightdope.com/u/Sunspace)\ **Post date:** [March 10, 2009, 6:24pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/13 "2009-03-10T18:24:43Z")
> [@Dewey\_Finn](#): > > Michael Lewis wrote an interesting [article](http://www.vanityfair.com/politics/features/2009/04/iceland200904) about the situation in Iceland in the new issue of Vanity Fair. Based on his description, I don’t expect things to get that bad in the US. He says, “In the end, Icelanders amassed debts amounting to 850 percent of their G.D.P. (The debt-drowned United States has reached just 350 percent.)” Um… yike! Canada’s deficit-to-GDP ratio appears to be [around 30%](http://www.tpsgc-pwgsc.gc.ca/recgen/pdf/49-eng.pdf) (PDF link from Receiver General of Canada), if I’m reading the linked article correctly. > [@](#): > > the accumulated deficit has been on a downward track… Since March 31, 1997, it has declined by $105.2 billion. As a percentage of GDP, it has fallen from a post-World War II peak of 68.4 percent at March 31, 1996 to 29.8 percent at March 31, 2008. That Vanity Fair article looks really interesting. ---
**Author:** ![Northern\_Piper](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/northern_piper/32/5304_2.png) [@Northern\_Piper](https://boards.straightdope.com/u/Northern_Piper)\ **Post date:** [March 10, 2009, 8:22pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/14 "2009-03-10T20:22:09Z")
**Sunspace** , I think that the Vanity Fair article is talking about the accumulated debt of all Iceland businesses and banks, not just the government. The Receiver General’s report is just about the accumulated debt of the federal government of Canada. ---
**Author:** ![Sunspace](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/sunspace/32/1250_2.png) [@Sunspace](https://boards.straightdope.com/u/Sunspace)\ **Post date:** [March 10, 2009, 8:26pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/15 "2009-03-10T20:26:45Z")
> [@Northern\_Piper](#): > > **Sunspace** , I think that the Vanity Fair article is talking about the accumulated debt of all Iceland businesses and banks, not just the government. The Receiver General’s report is just about the accumulated debt of the federal government of Canada. Hmm. On reflection, I think you’re right. I’m now wondering that the equivalent figure for Canada might be. Sum total of all public and private debts? ---
**Author:** ![Northern\_Piper](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/northern_piper/32/5304_2.png) [@Northern\_Piper](https://boards.straightdope.com/u/Northern_Piper)\ **Post date:** [March 10, 2009, 8:35pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/16 "2009-03-10T20:35:36Z")
> [@WormTheRed](#): > > It sure does… is there any place on the planet where it doesn’t look like it’s going to hell in a handbasket? I only read of gloom, everywhere I look. Well, as CNN reported recently we’re doing quite well in Piper-land (also known as Saskatchewan): [Saskatchewan a jobs ‘hot spot’ in Canada](http://www.cnn.com/2009/WORLD/americas/03/04/saskatchewan.economy/index.html?iref=newssearch) > [@](#): > > Normally, “hot spot” isn’t the first phrase that comes to mind when talking about Saskatchewan, Canada. > > But with most of Canada suffering from devastating job losses, this cold province is becoming exactly that. > > It’s an asterisk to the entire country when it comes to the economic climate, and Premier Brad Wall is shouting it as loud as he can. > > “It’s a great time to come to Saskatchewan,” said Wall, who even called the Toronto Star newspaper to tout his province’s economic success and let Ontarians know there were jobs for the taking. And, while Canada as a whole is suffering from the economic downturn, it’s nothing like what’s happening in the US. Our banks are traditionally very conservative, in part because the federal government has a very conservative approach to regulating them. We haven’t had a bank failure in Canada since the late 70s, when two banks went under, the first since the Great Depression forty-five years earlier. By contrast, I think the news last night was around 14 banks have gone under in the US this year alone, and more may follow. So, **WormTheRed** , why not think about Saskatchewan? ---
**Author:** ![WormTheRed](https://avatars.discourse-cdn.com/v4/letter/w/bbe5ce/32.png) [@WormTheRed](https://boards.straightdope.com/u/WormTheRed)\ **Post date:** [March 10, 2009, 8:39pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/17 "2009-03-10T20:39:32Z")
Saskatchewan, hmm… _goes off to wiki and google_ ---
**Author:** ![Sunspace](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/sunspace/32/1250_2.png) [@Sunspace](https://boards.straightdope.com/u/Sunspace)\ **Post date:** [March 10, 2009, 8:45pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/18 "2009-03-10T20:45:32Z")
> [@WormTheRed](#): > > Saskatchewan, hmm… > > _goes off to wiki and google_ Like temperatures of -40C? My mom was born in Saskatchewan, and told me stories of walking to school though such temperatures on the wooden sidewalks of Regina. Saskatchewan is flat, beautiful, with an inland mid-continental steppe climate. Think ‘hot in summer, cold in winter’. But mom always spoke of the incredible skies there, and it’s true. It’s so spacious. Also, it apparently doesn’t do Daylight Saving Time. ---
**Author:** ![Dewey\_Finn](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dewey_finn/32/4222_2.png) [@Dewey\_Finn](https://boards.straightdope.com/u/Dewey_Finn)\ **Post date:** [March 10, 2009, 8:48pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/19 "2009-03-10T20:48:06Z")
He’s from _Iceland_. It’s not so different, climate-wise. ---
**Author:** ![Sunspace](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/sunspace/32/1250_2.png) [@Sunspace](https://boards.straightdope.com/u/Sunspace)\ **Post date:** [March 10, 2009, 8:49pm UTC](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957/20 "2009-03-10T20:49:14Z")
> [@Dewey\_Finn](#): > > He’s from _Iceland_. It’s not so different, climate-wise. Actually, it might be. Mid-oceanic climate, extremes moderated by the sea? Never gets very cold or very warm? [Next page](https://boards.straightdope.com/t/4th-bank-down-icelandic-economy-mess/488957.md?page=2)