Trapped Under Ice

|

The Humpty Dumpty fall of Iceland, which has been hit like no other nation by the credit crisis, is continuing with an IMF rescue.

The IMF may provide about $1 billion in emergency cash for Iceland with the balance lent by Norway, Sweden and Denmark and additional money possibly coming from Russia and Japan. Iceland, which has the same population as Coventry, had hoped that a bigger loan from Russia would save it from the humiliation and financial strictures of an IMF bailout.

Bjorgvin Sigurdsson, the Icelandic Banking and Commerce Minister, told The Times last night: "The talks with the IMF have progressed so that we are now at a stage where conditions, pros and cons are being looked over."

Economists gave warning that $6 billion would not be sufficient to refloat Iceland's devastated banking system because the Government needs so much foreign currency to buy basic supplies for Icelanders.

Anne Applebaum has a suitably panicky column about all of this, pinning some of the blame for Iceland's crisis on unsourced speculation (that got back to Iceland) about the country's wealth getting out of dodge.

NEXT: Just How Much Stimulation Can One Man Economy Take?

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  1. Iceland, which has the same population as Coventry

    I realize this is a British source, but that is completely worthless to me. All I know now is that Iceland has a hot, naked chick on horseback.

    Not as bad as the British article I saw yesterday that referred to Myrtle Beach as being “near Miami”.

  2. Can’t Bjork just write a check for that, or at least let the rest of the country live in her house? She must have 20 rooms for the whole nation to sleep in.

  3. Not as bad as the British article I saw yesterday that referred to Myrtle Beach as being “near Miami”.

    You must remember, our ‘superiors’ over in Europe kno more than we do about everything. If being on the same coast in the same State means “near” then who are we, mere break away Colonists, to argue?

  4. Guy,

    Myrtle Beach is two states away from Florida.

  5. Not as bad as the British article I saw yesterday that referred to Myrtle Beach as being “near Miami”.

    But Myrtle Beach is near Miami. Just like London is “near Berlin.”

  6. parse,

    Stealing from fark or did you make the comparison there too?

  7. parse,

    See? You have become one of them already 😉

  8. parse,

    Unless you are Philliam.H.Muffman you need to start footnoting.

  9. er, I mean robc has become one of them already.

    Thank goodness I am at work where I can’t damage my own property in real like I am mangling this thread.

  10. Hey, maybe my critical reading skills aren’t that good, but wasn’t the “unsourced speculation” about wealth getting out of “Dodge” about Poland, not Iceland?

    You know, Poland, where Ms. Applebaum’s husband is Minister of Foreign Affairs?

    But, you know, wherever reason guides you . . . .

  11. Cool–I just bought Iceland!

    I love E*Trade.

  12. I love “unsourced speculation” – someone who has no idea what they are talking about and declines to be named. meaningfully equivilent to “some retarded guy I saw”

  13. OT: Um,. just scrolled through the main H&R page and have not seen a story on Sen. Biden warning of a major international crisis, generated from abroad, directed at the US, if he and Sen. Obama are elected. One to occur in the first six months of swearing in.

    Heard the clip on the radio a dozen times before leaving for work this AM so it should not be all that obscure.

    Credit to Sen. Biden though, he though he was just talking to a bunch of Democrat donors and supporters. He seemed to be unaware that the back of the room was lined with invited members of the press.

    Perhaps this is this going to be the new way to get an appointment with Pres. Obama? Threaten or attack the US so one can have a little chat about the grievences with no preconditions?

    Thank goodness I didn’t vote for those guys.

  14. “OT: Um,. just scrolled through the main H&R page and have not seen a story on Sen. Biden warning of a major international crisis, generated from abroad, directed at the US, if he and Sen. Obama are elected. One to occur in the first six months of swearing in”

    I haven’t read anything here about the worst news of the month – they’re discontinuing Zima. We’re doomed.

  15. I can’t believe that you used that title and didn’t include appropriate video.

    For the two of you who probably care:

    http://www.youtube.com/watch?v=qVzX4bnT7bk&feature=related

  16. Good luck in high school next year, jsh. When is your winter break?

  17. I haven’t read anything here about the worst news of the month – they’re discontinuing Zima. We’re doomed.

    IIRC, I knew the cousin of the creator of that ‘product’ back in college, late 1980s/early 1990s. Her name was Sima, her cousin (as student at Memphis) mantioned the idea and she asked it be named after her. He modified the name to Zima.

  18. Guy, I think they were having you on. Zima means ‘winter’ in Russian.

    RU Pickman – I thought Ride the Lightning was their best album. Ai!

  19. GM, there was an Obama spokesman on GMA this morning. He was asked about Biden’s comment. He said that with the economy in the crapper and 2 wars we are in and the energy thing and the environment that whoever wins the whitehouse gets an instant crisis with it.

  20. Can someone explain why Iceland, of all places, has become the poster child for credit crisis? Does it have something to do with Loki?

  21. Should “Dodge” be capitalized?

  22. BakedPenguin: Tough call – For me it’s always been between RTL and Puppets.

  23. b,

    GM, there was an Obama spokesman on GMA this morning. He was asked about Biden’s comment. He said that with the economy in the crapper and 2 wars we are in and the energy thing and the environment that whoever wins the whitehouse gets an instant crisis with it.

    Ah, so that is what the secret message, contained in a bunch of words that had nothing to do with the explaination. Sounds a lot like the Sen. Kerry Swisse Cheesesteak deal in Philly a few years ago. You see, the Senator was distracted by all the holes in the Bush employment plan . . .

  24. BakedPenguin,

    Guy, I think they were having you on. Zima means ‘winter’ in Russian.

    No, it was for real, but that might be a forgotten bit on why the spelling of Sima was changed to Zima, almost the same sound plus a marketing twist.

  25. the spelling of Sima was changed to Zima

    Perhaps they wanted to avoid a lot of “Simian” references.

  26. Somebody has been jammin’ to a lot of Metallica lately.

  27. PB,

    Never thought of that, but could be. The family is Iranian, not sure if that has any social impact.

  28. the Government needs so much foreign currency to buy basic supplies for Icelanders

    So, socialist countries living on a barren volcanic island are subject to the vagaries of international trade and the competence of their finance ministers?

    In other words, they can’t grow their own food, and the locals can’t buy their own supplies?

    Brilliant.

  29. Didn’t Zima emerge fully formed (like Athena from Zeus) from the skull of a midlevel marketing guy at Coors? I love the commentary on Babylon 5 season one that the set dresser thought that using a Zima neon would add a futuristic look to the space station restaurant.

    Episarch: Iceland was the home of some recently privatized banks that aggressively marketed 5%+ short term deposit interest rate to Europeans. Europeans signed up in droves, banks bought lots of fancy higher-yield structured debt from Wall Street, in the process becoming 100B sized institutions. Europeans panicked and ran for the exits in a classic bank run, and as the wall street products cannot be sold for any price, so the Icelandic government stepped up to say we will cover deposit insurance on the banks, not realizing (or poorly realizing) that the banks were 10 times larger than they had been when nationalized.

    I hope Alcoa still can build their planned world’s largest geothermal aluminum smelter in iceland – that’s the kind of infrastructure that could really help the world economy for decades.

  30. Can someone explain why Iceland, of all places, has become the poster child for credit crisis? Does it have something to do with Loki?

    Because they built their recent economic successes on bad credit, offering it, buying it, selling it to the unwary, &c. When the credit market collapsed, they had no economy left. Think of a mill town when the trees are gone.

  31. Episiarch,

    Well, Iceland has been in trouble ever since they overestimated the economic strength of Vanilla Ice. The slogan “Ice, Ice, baby” apparently did not garner the tourist business they thought it would. However, you still can visit the Hall of Vanilla Ice in Hafnarfj?r?ur.

  32. Iceland had a thriving anarchist society once before, and it looks like they’ll be having another one soon. I just hope they don’t finance this one with pillage and raping like they did the last.

  33. I just hope they don’t finance this one with pillage and raping like they did the last.

    It has been historically difficult to use rape as a medium of economic exchange, but it does cut down on bank runs.

  34. Sheesh, it kinda sucks when your whole country resembles Wachovia. I have genuine sympathy for the fish-eaters and “geothermal pioneers”. Can’t they just sell off some of that free steam?

  35. I just hope they don’t finance this one with pillage and raping like they did the last.

    Why not? No skin off my nose if they work over some Irish monasteries to pay the bills…

  36. When American Government goes bankrupt, who will bail us out?

  37. It has been historically difficult to use rape as a medium of economic exchange, but it does cut down on bank runs.

    I believe it wasn’t so much a medium of exchange as it was part of their employee incentive plan.

  38. Trapped Under Ice is my favorite song on Ride the Lightning!! I love musical references in the reason titles!

Please to post comments

Comments are closed.