Iceland teeters on the brink of bankruptcy

Iceland teeters on the brink of bankruptcy

news.yahoo.com

REYKJAVIK, Iceland - This volcanic island near the Arctic Circle is on the brink of becoming the first "national bankruptcy" of the global financial meltdown.

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Home to just 320,000 people on a territory the size of Kentucky, Iceland has formidable international reach because of an outsized banking sector that set out with Viking confidence to conquer swaths of the British economy — from fashion retailers to top soccer teams.

The strategy gave Icelanders one of the world's highest per capita incomes. But now they are watching helplessly as their economy implodes — their currency losing almost half its value, and their heavily exposed banks collapsing under the weight of debts incurred by lending in the boom times.

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It seems to be unfolding that economies that are founded on financial services will most likely not survive this crisis. When the dust settles the only economies left in decent condition will be ones that are invested in production and manufacturing, processing, transporation and communication.

I think it is so revealing that real production is what makes it through the tough times.

You know what, boy? I am about as tired of hearing about your economic and financial theories as I am about hearing about your religion. Now, pick up that shovel and do some work!

news.yahoo.com
(visit the link for the full news article)

[edit on 7-10-2008 by bruxfain]

Originally posted by bruxfain
It seems to be unfolding that economies that are founded on financial services will most likely not survive this crisis.

Who is next? Switzerland, Luxembourg?
Ireland was 4 days from biting the bullet but has dodged it through a pretty good isolationist move by the government.