# Iceland's going under... **URL:** \ **Category:** Miscellaneous and Personal Stuff I Must Share\ **Created:** [October 3, 2008, 12:32pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298 "2008-10-03T12:32:00Z")\ **Posts on this page:** 20\ **Page:** 4
**Author:** ![An\_Gadai](https://avatars.discourse-cdn.com/v4/letter/a/d6d6ee/32.png) [@An\_Gadai](https://boards.straightdope.com/u/An_Gadai)\ **Post date:** [October 9, 2008, 5:49pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298/61 "2008-10-09T17:49:33Z")
150,000 ISK would get me about the same here if not more. I gotta wait a while :P. ---
**Author:** ![WormTheRed](https://avatars.discourse-cdn.com/v4/letter/w/bbe5ce/32.png) [@WormTheRed](https://boards.straightdope.com/u/WormTheRed)\ **Post date:** [October 9, 2008, 6:27pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298/62 "2008-10-09T18:27:33Z")
> [@Sunspace](#): > > Blocked all international transfers? :eek: > > Are we going to have to air-drop bales of Canadian dollars? Send in euros in rubber boats? Sneak USD in via fishing trawler? > > Um… you guys _do_ have sufficient basic food supplies, even if you have to live on steamed mutton and fish? Yeah, we do. Fish and lamb are going to make a major comeback this season, with wool-sweaters being the it-thing on the dancefloors 🙂 It’s a temporary stop. The markets will open again on monday. And I’ve been guaranteed that I can use my cc in Sweden over the weekend. (yeah, I’m the dumbass that leaves the country when no-one knows how much their money is worth). I’m sorry for the lame joke answers. I just need an outlet for things, and humor it is. ---
**Author:** ![WormTheRed](https://avatars.discourse-cdn.com/v4/letter/w/bbe5ce/32.png) [@WormTheRed](https://boards.straightdope.com/u/WormTheRed)\ **Post date:** [October 9, 2008, 6:30pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298/63 "2008-10-09T18:30:04Z")
> [@An\_Gadai](#): > > 150,000 ISK would get me about the same here if not more. I gotta wait a while :P. What? I can get two beers at a bar in Reykjavik for each one in Copenhagen. I am so going bar-hopping on Temple Bar (right?) when my money is worth something again. ---
**Author:** ![KGS](https://avatars.discourse-cdn.com/v4/letter/k/90ced4/32.png) [@KGS](https://boards.straightdope.com/u/KGS)\ **Post date:** [October 9, 2008, 7:30pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298/64 "2008-10-09T19:30:00Z")
Sorry to hear about your country’s financial troubles. I hope everything works out. On the other hand…are you sure this isn’t Karmic retribution for Björk? 😉 ---
**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:** [October 9, 2008, 7:36pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298/65 "2008-10-09T19:36:09Z")
> [@KGS](#): > > On the other hand…are you sure this isn’t Karmic retribution for Björk? 😉 Hey! Bjork is quirky and cute (or, at least, _was_ quirky and cute.) If there’s anyone who invites karmic retribution, it’s Celine Dion, and this worries me. ---
**Author:** ![What\_Exit](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/what_exit/32/10652_2.png) [@What\_Exit](https://boards.straightdope.com/u/What_Exit)\ **Post date:** [October 9, 2008, 7:46pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298/66 "2008-10-09T19:46:08Z")
> [@Sunspace](#): > > Hey! Bjork is quirky and cute (or, at least, _was_ quirky and cute.) If there’s anyone who invites karmic retribution, it’s Celine Dion, and this worries me. Yes, Quebec should pay for unleashing the screeching fugly evil harpy on the world. She is to music what Barney is to Kid’s TV and Wesley Crusher was to Star Trek. ---
**Author:** ![WormTheRed](https://avatars.discourse-cdn.com/v4/letter/w/bbe5ce/32.png) [@WormTheRed](https://boards.straightdope.com/u/WormTheRed)\ **Post date:** [October 9, 2008, 7:56pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298/67 "2008-10-09T19:56:47Z")
> [@KGS](#): > > Sorry to hear about your country’s financial troubles. I hope everything works out. > > On the other hand…are you sure this isn’t Karmic retribution for Björk? 😉 Now wait a minute. She now lives in London and the Brits are pretty darn pissed at us at the moment. So maybe it’s just payback for Björk, with the banks being a smoke-screen for the real problems. As for you Brits out there. I do apologize very much for the behaviour of our banks and our government and do hope that relations will be normalised as soon as possible. (and please come spend your Pounds - we like those Pounds 😉 ) ---
**Author:** ![Dangerosa](https://avatars.discourse-cdn.com/v4/letter/d/22d042/32.png) [@Dangerosa](https://boards.straightdope.com/u/Dangerosa)\ **Post date:** [October 10, 2008, 12:03am UTC](https://boards.straightdope.com/t/icelands-going-under/466298/68 "2008-10-10T00:03:39Z")
> [@What\_Exit](#): > > Interesting little rant and factually wrong as usual. > Fish is the #1 export by far, (70%) but the main exports are fish and fish products, aluminum, and ferrosilicon. [My Cite](https://www.cia.gov/library/publications/the-world-factbook/geos/ic.html#Econ). > > Addtionally: Don’t forget the bananas… > **[Banana production in Iceland](https://en.wikipedia.org/wiki/Banana_production_in_Iceland)** > > Although Iceland is reliant upon fishing, tourism and aluminium production as the mainstays of its economy, the production of vegetables and fruit in greenhouses is a growing sector. Until the 1960s, this included commercial production of bananas. > In 1941, the first bananas in Iceland were produced. They have been produced since that time, about 100 clusters a year each weighing about 5–20 kg (11–44 lb), but are not currently sold. In the wake of World War II, the combination of inexpensive ge... ---
**Author:** ![carnivorousplant](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/carnivorousplant/32/3563_2.png) [@carnivorousplant](https://boards.straightdope.com/u/carnivorousplant)\ **Post date:** [October 10, 2008, 12:23am UTC](https://boards.straightdope.com/t/icelands-going-under/466298/69 "2008-10-10T00:23:56Z")
> [@Dangerosa](#): > > Don’t forget the bananas… Maybe that’s the guy I sent the tropical water lilies to…🙂 ---
**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:** [October 10, 2008, 12:33am UTC](https://boards.straightdope.com/t/icelands-going-under/466298/70 "2008-10-10T00:33:15Z")
> [@Dangerosa](#): > > Don’t forget the bananas… > > [Banana production in Iceland - Wikipedia](http://en.wikipedia.org/wiki/Banana_production_in_Iceland) Ah. Another thing [in common with Canada](http://www.sunnyosoyoos.com/webpages/fernandes_fruit.htm). 🙂 ---
**Author:** ![slaphead](https://avatars.discourse-cdn.com/v4/letter/s/e9bcb4/32.png) [@slaphead](https://boards.straightdope.com/u/slaphead)\ **Post date:** [October 10, 2008, 9:12am UTC](https://boards.straightdope.com/t/icelands-going-under/466298/71 "2008-10-10T09:12:15Z")
> [@WormTheRed](#): > > As for you Brits out there. I do apologize very much for the behaviour of our banks and our government Yeah. Providing Brown with a way of distracting the peanut gallery from the fact that he spent a decade in charge of the economy while it charged right off a cliff. Outrageous! Personally I couldn’t give a toss if the Icelandic banks hang on to every penny. After the whole BCCI debacle one would have thought people would have learnt a lesson, but no. Put vast amounts of money into a country smaller than Glasgow in order to get an outsize interest payment, and then bleat like raped sheep when it turns out to be a mistake. Given that the UK government (you know, the one responsible for looking after the worlds second-largest financial hub) is itself not willing to fully guarantee the deposits of British citizens in British banks, I think it’s a bit shitty to expect a tiny country like Iceland to protect a bunch of greedy Brits from the consequences of their own actions. ---
**Author:** ![WormTheRed](https://avatars.discourse-cdn.com/v4/letter/w/bbe5ce/32.png) [@WormTheRed](https://boards.straightdope.com/u/WormTheRed)\ **Post date:** [October 10, 2008, 9:32am UTC](https://boards.straightdope.com/t/icelands-going-under/466298/72 "2008-10-10T09:32:43Z")
> [@slaphead](#): > > Personally I couldn’t give a toss if the Icelandic banks hang on to every penny. After the whole BCCI debacle one would have thought people would have learnt a lesson, but no. Put vast amounts of money into a country smaller than Glasgow in order to get an outsize interest payment, and then bleat like raped sheep when it turns out to be a mistake. Given that the UK government (you know, the one responsible for looking after the worlds second-largest financial hub) is itself not willing to fully guarantee the deposits of British citizens in British banks, I think it’s a bit shitty to expect a tiny country like Iceland to protect a bunch of greedy Brits from the consequences of their own actions. Well, the thing is, at least Kaupthing Edge was guaranteed by the British Government. So I really don’t get what the quarrel was there (apart from breaking the bank and nationalising parts of it, they might get off on that). But I do like your perspective 🙂 As for our Bananas, they don’t taste very well. Actually, they taste like crap. Gimme those imports instead. ---
**Author:** ![WormTheRed](https://avatars.discourse-cdn.com/v4/letter/w/bbe5ce/32.png) [@WormTheRed](https://boards.straightdope.com/u/WormTheRed)\ **Post date:** [October 10, 2008, 9:36am UTC](https://boards.straightdope.com/t/icelands-going-under/466298/73 "2008-10-10T09:36:06Z")
> [@carnivorousplant](#): > > Maybe that’s the guy I sent the tropical water lilies to…🙂 Even though they taste like crap (see above post), it’s actually a very nifty place. It’s the Gardening Center of Iceland which has quite a few greenhouses with all sorts of nifty non-native plants. So I’ve tried an icelandic Orange (taste, not good) and Lemon (nope) in addition to the Banana. I think the conclusion to the experiment should’ve been, “yes we can do this, but man do we suck at it considering how awful all our fruits taste”. ---
**Author:** ![An\_Gadai](https://avatars.discourse-cdn.com/v4/letter/a/d6d6ee/32.png) [@An\_Gadai](https://boards.straightdope.com/u/An_Gadai)\ **Post date:** [October 10, 2008, 1:09pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298/74 "2008-10-10T13:09:30Z")
> [@WormTheRed](#): > > What? I can get two beers at a bar in Reykjavik for each one in Copenhagen. I am so going bar-hopping on Temple Bar (right?) when my money is worth something again. In Temple Bar yes, but I can bring you to the cheaper, better spots. ---
**Author:** ![Huerta88](https://avatars.discourse-cdn.com/v4/letter/h/82dd89/32.png) [@Huerta88](https://boards.straightdope.com/u/Huerta88)\ **Post date:** [October 10, 2008, 4:11pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298/75 "2008-10-10T16:11:27Z")
One of the things that the current financial system has (re)-educated me on is that it’s kind of important to pay attention to what’s going on in the world. I admit my knowledge of Icelandic finance was limited to the vague knowledge that their bonds paid a lot of interest, the government and economy was supposedly solidly funded thanks to being essentially energy-independent, and they were looking forward to maybe joining the Euro. Apparently I didn’t (everyone didn’t) probe too deeply into exactly what was going on with the banks, etc. So, forgive my ignorance and my earlier distracted complacency. But, **Worm** , at a convenient moment, would you mind giving us (your possibly-biased best understanding of) What Just Happened And Why? ---
**Author:** ![WormTheRed](https://avatars.discourse-cdn.com/v4/letter/w/bbe5ce/32.png) [@WormTheRed](https://boards.straightdope.com/u/WormTheRed)\ **Post date:** [October 13, 2008, 4:42pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298/76 "2008-10-13T16:42:23Z")
> [@Huerta88](#): > > So, forgive my ignorance and my earlier distracted complacency. But, **Worm** , at a convenient moment, would you mind giving us (your possibly-biased best understanding of) What Just Happened And Why? First, sorry for the late reply, but I’ve been off the island for a wedding this weekend and just got back. But the basics of the situation, as far as I can understand. It all started with “fishing quotas”. The government handed them out to different vessels (with the quota depending upon its tonnage) and this made some people very wealthy (since they basically got money for nothing). The thing was that the vessels didn’t really need to be operational, but you could take any old ship and get your quota for free. Hence, a very good investment oppurtunity for the people who could get their hands on old ships (among others, a previous finance minister). So with the money they made from that, they purchased parts of the newly privatized banks, but soon realized that Iceland was to small to really rake in the big cash. This was in the mid to late 90.s. There, started the Icelandic expansion based on a simple equation. You have X amount of money and use it to buy company A. Then you take out a loan on company A and with that money buy company B. Then you take out a loan on company B and buy company C and so on. This works really well as long as you are making enough money to pay for your ever increasing loans. And with a stock-market that was ever heading upwards (who ever heard of stock prices falling!?!) there wasn’t really a problem with going on. Cause you could always issue new stock or options to satisfy the creditors. And in the end, the banks, ended up owing roughly 5 times the GDP of this poor little island. So once things weren’t going up anymore, it turned sour. And that is what we are experiencing right now ☹ Does that make it any clearer? ---
**Author:** ![Cervaise](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cervaise/32/16693_2.png) [@Cervaise](https://boards.straightdope.com/u/Cervaise)\ **Post date:** [October 13, 2008, 5:16pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298/77 "2008-10-13T17:16:08Z")
It can’t be that simple, can it? That’s, like, Ignorant College Freshman Math: “I owe a lot on this credit card, so I just need another one to pay off the first one. I’ll pay off the second one later.” How does the Ignorant College Freshman get into the position of making High Finance decisions? ---
**Author:** ![WormTheRed](https://avatars.discourse-cdn.com/v4/letter/w/bbe5ce/32.png) [@WormTheRed](https://boards.straightdope.com/u/WormTheRed)\ **Post date:** [October 13, 2008, 6:01pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298/78 "2008-10-13T18:01:57Z")
> [@Cervaise](#): > > It can’t be that simple, can it? That’s, like, Ignorant College Freshman Math: “I owe a lot on this credit card, so I just need another one to pay off the first one. I’ll pay off the second one later.” How does the Ignorant College Freshman get into the position of making High Finance decisions? That’s the basics of it, obviously simplified quite a bit. And how he manages? He knows people. That’s all that matters here. You have to know the right people. The new board of directors for the nationalised banks do for example consist of quite a few assistants to ministers. ---
**Author:** ![slaphead](https://avatars.discourse-cdn.com/v4/letter/s/e9bcb4/32.png) [@slaphead](https://boards.straightdope.com/u/slaphead)\ **Post date:** [October 13, 2008, 10:10pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298/79 "2008-10-13T22:10:18Z")
> [@Cervaise](#): > > It can’t be that simple, can it? That’s, like, Ignorant College Freshman Math: “I owe a lot on this credit card, so I just need another one to pay off the first one. I’ll pay off the second one later.” How does the Ignorant College Freshman get into the position of making High Finance decisions? Well, it’s certainly enough to get you started, that’s for sure. And remember, for the last twenty years the of whole western finance has been all about leverage, leverage, and more leverage. Add in the ‘carry trade’, which basically was a trick popular in New York and London that consisted of borrowing a few hundred million in a currency with low interest rates (like Yen, maybe 2.5% and investing in a currency with higher interest rates (like the ISK, at 7% or whatever) and you ended up with a mountain of money piling into Iceland. Remember, so long as it keeps going you’re a genius, just like Gordon “I’m the greatest Chancellor ever” Brown, Dick “Look how big I’ve made Lehman Brothers, fear my genius” Fuld and the rest of them. [QUOTE=WormTheRed] It all started with “fishing quotas”. The government handed them out to different vessels (with the quota depending upon its tonnage) and this made some people very wealthy (since they basically got money for nothing). [/QUOTE] Hey, don’t knock it. At least you’ve still got some fish left, think how bad it would be if you’d done things EU-style and fished out everything apart from two diseased pilchards and a one-eyed sprat called Wilbur. Then what would you do? ---
**Author:** ![Ximenean](https://avatars.discourse-cdn.com/v4/letter/x/aca169/32.png) [@Ximenean](https://boards.straightdope.com/u/Ximenean)\ **Post date:** [October 13, 2008, 10:33pm UTC](https://boards.straightdope.com/t/icelands-going-under/466298/80 "2008-10-13T22:33:33Z")
I can’t help hearing that conga tune in my head when I see this thread title: \*# Iceland’s going un - der Iceland’s going un - der Da daa daa da Da daa daa da # # Iceland’s going un - der etc.\* Anyway, back to the voodoo economics. [Previous page](https://boards.straightdope.com/t/icelands-going-under/466298.md?page=3) [Next page](https://boards.straightdope.com/t/icelands-going-under/466298.md?page=5)