The Mudcat Café TM
Thread #114937 Message #2461071
Posted By: Emma B
09-Oct-08 - 10:28 AM
Thread Name: BS: So it has come to this - Iceland
Subject: RE: BS: So it has come to this - Iceland
Sinsull it may indeed be Monopoly money but the 'losers' in this 'game are real enough.
'THE Naomi House children's hospice is teetering on the brink of a major financial crisis by revealing it has a seven-figure sum at risk in the Icelandic banking crisis.
The hospice revealed that it has invested the sum in an Icelandic bank Kaupthing Singer and Friedlander.
The hospice for terminally-ill children has committed £5.7 million and the future of the money is now uncertain'
Todays Times on line also looks at the impact on Icelanders
'Iceland: the land of cool turns bitter'
Iceland's financier-Vikings made their homeland trendy and wealthy - until the banking crisis left it with crippling debts
'Suddenly an island with a population of 300,000, seen for the past decade as the essence of cool - a successful nation where people couldn't stop partying - is on the brink of becoming a failed state.
Who to blame? How to survive? What did the islanders give up when they chased the money, forgot their roots and turned themselves into a Nordic Tiger?
For centuries Iceland had a fish-based economy, even fighting a war with Britain to keep its lucrative cod trawling grounds. Then it began exporting aluminium, and then, after free-market reforms introduced by the Thatcherite Prime Minister Davìd Oddsson, it rapidly privatised its banking sector and moved into the business of financial engineering - to such an extent that a handful of Icelandic banks, expanding aggressively, have ended up with liabilities more than eight times the national GDP.
That gold rush, at the beginning of this century, has spun the illusion of wealth. Dorrit Moussaieff, the jet-setting jewellery-designer wife of President Ólafur Ragnar Grimsson, set the tone, with her coterie of girlfriends - Rannveig Rist, the general manager of Alcan Iceland; Tinna Gunnlaugsdóttir of Iceland's National Theatre; artists and gallery owners
But it wasn't just a wealthy elite who surfed the Zeitgeist. Ordinary Icelanders were swiftly freed from the idea that they belonged to an impoverished society where the key question about a future bride was: is she a good housekeeper?
In the past five years, people's average wealth has grown by 45 per cent - and the money has gone into houses and cars, financed by 100 per cent loans based on a spread of foreign currencies. Now the krona is plummeting, loans are ballooning and thousands are defaulting. The only good news is for foreign visitors, for whom beer has at last become affordable
The new Vikings have been thriving on the cronyism and back-scratching culture of Reykjavik.
Since the beginning of the 20th century banks and government have worked hand in glove
Across the social spectrum, Icelanders agree: life has to change. You can't wish away global capitalism but you can change the way that elites manage that capital. The alternative is to see your country disappear down the plughole.'
Full report here