Poor Iceland ...
It was too small to survive in the new Globalized economy.
Check it from Bloomberg:
Trading in the Icelandic krona came to a halt after the government seized control of Kaupthing Bank hf, the nation's biggest lender, as the financial crisis deepens.
There haven't been any so-called krona spot trades today, or transactions in which currency must be exchanged immediately, according to Stockholm-based Nordea Bank AB and TD Securities Ltd. in London. The last spot trade was at 340 krona per euro, Nordea said. Regulators earlier this week took over Iceland's second- and third-largest lenders, Glitnir Bank hf and Landsbanki Islands hf, which acted as krona clearing houses.
...
The krona plummeted to 350 per euro this week in trading between banks outside of Iceland, Praefcke said. Icelandic banks may still be trading with each other, she said.
``Foreign banks have cut credit lines with Icelandic banks so they can't settle trades,'' Praefcke said.
Okay, let's be honest here.
If you want to survive in the Global Ownership Society, you gotta be massive. Your banks have to be huge. Your debts have to be huge. Your consumption has to be huge. Your economy has to be huge. Your population has to be huge. Your military has to be huge.
Do you understand this?
You have to be too big to fail.
Iceland is the Vienna sausage of countries.
Iceland's banks knew that they had to be as big as other European banks, if they wanted to survive in the new globalized economy. They had to be too big to fail. So they grew and grew and expanded and went global and gobbled and gobbled and borrowed and borrowed and leveraged and leveraged ...
And then popped.
Because its banks were not only too big to fail, they were too big to succeed. They grew to sizes many times that of Iceland's GDP. The Icelandic government wants to bail them out, but how? Where are they going to get the money?
Economy busted.
Currency worthless.
Totally screwed.
Appreciated those Eddas, however -- I must say!
Anyway ...
What can Iceland do now? They were already turned down by Europe and America when they went begging for a loan. Finally, Russia stepped in with 4 billion EUR -- a pittance! This ain't going to be enough.
Iceland, you are too small to survive.
Iceland's prime minister put out this pitiful statement earlier in the week. The last chirp of a canary, barely heard elsewhere on the globe.
My advice to the government of Iceland:
Call it quits. Close down business. Sell your people into slavery. Put Bjork on eBay.
Because unless we get serious about driving out the demons of Globalization, unregulated markets, unregulated trade and unregulated, unabated financialization of economies in the developed world ...
You don't stand a chance.
Nice to have known you. Your standing army is a joke.