Iceland is in the heart of the economic storm

**By Gwladys Fouché, The Guardian
Iceland enjoyed a fantastic party. Now it is having a huge hangover.

The island of 319,000 inhabitants is in the heart of the financial storm. Today, share trading in six of Iceland’s biggest financial firms was suspended while waiting for an official announcement. The government is under hard pressure to come up with an economic bailout to rescue the country’s financial system. Some analysts argue it won’t be able to.

Just last week the authorities were forced to nationalise the nation’s third-largest bank, Glitnir, taking a 75% share in the firm for 600m euros (£464m). Iceland’s currency, the krona, is plummeting against the euro and the dollar. It is rated the world’s third-worst performing currency "“ just above Zimbabwe’s and Turkmenistan’s. Inflation is at a whopping 14% per year, with some suggesting it could soar to 20%.

If only they had chosen to remain part of the Danish Commonwealth, they could have avoided this mess :wink:

Despite the collapse, government officials do not expect to have to make major cuts in social benefits, which include generous unemployment insurance, nearly free health care, and subsidized housing for the jobless.

“We are fairly confident that we will have the resources so that people can maintain a reasonable standard of living while we are going through the worse,” says Kirstjan Kristjansson, spokesman for embattled Prime Minister Geir Haarde, chairman of the free-market Independence Party. Mr. Kristjansson added that thus far the country has seen a drop in gross domestic product and personal incomes that returns them to the levels of 2003 – just last year they had the fourth highest per capita income in the world – and that a third of this year’s national budget, which has long run in surplus, will be debt-financed.

We have to pray very hard, this is certainly a global crisis. There is rioting in Lithuania too. And the poorest of the poor are feeling the pinch even more.
We have to trust in God and get down on our knees and ask him to help us all.

Their government just resigned.

The new government is expected to be led by the Social Democrats, who favor joining the EU. Iceland already has one foot in the door, but has been resisting the EU because it wants to protect its fishing (and controversial whaling) industry.

Iceland is saved!

Iceland Picks the World’s First Openly Gay PM

The longest-sitting MP in Iceland, with three decades in parliament and four stints as minister of social affairs, Sigurðardóttir has gained a reputation for giving voice to social issues such as gender equality, a robust welfare system, and rights for the disabled and elderly. Fellow MP Ágúst Einarsson went as far as to call her “socialism incarnate.” Firmly planted in left-of-center politics, the new minister reflects the nation’s post-meltdown retreat from the right, demonstrated in recent polling data.

Besides her politics, the minister’s past as a working woman resonates with the increasingly disgruntled middle class. With only a high school diploma, Sigurðardóttir began her career as a flight attendant and later worked in the office of a box factory.

You fail it.

I’d really love to post up the facepalm again, but I’d get b&

Oh, relax. I was just kidding. I was tickled by the description of her. She could never be elected president in the US.

I’ve been reading about this for the past couple of weeks. It’s sad to me b/c I went on vacation there a couple of years ago and it is a amazing country (definetely putting it at the top on my pontentiall countries for honeymoon list)

One interesting thing about the crash of their currency is that real estate there is becoming dirt cheap.

For instance:

Imagine being able to snag that as a vacation hosue, rental house, or flippable house for $850,000 USD!:eek:

(Seems like a lot, but given the location that is a really nice deal.)

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