IMF Takes Over Iceland
"Icelanders face frugal holiday in economic chill" by Jill Lawless, Associated Press | December 14, 2008
REYKJAVIK, Iceland - Here are a few things selling briskly in Iceland's capital as Christmas approaches: horsemeat, secondhand clothing, and used DVDs of "The Sound of Music."
Thrift is the new mantra in Iceland, a volcanic island nation just below the Arctic Circle now trapped in an economic deep freeze, with rising unemployment, soaring prices, and a paralyzed banking system....
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This is a tough Christmas in Iceland, a country that cherishes its Yuletide traditions. Multicolored lights twinkle on houses and trees across Reykjavik during the 19 hours a day of December darkness. Soon children will place shoes on their windowsills for the 13 Yule Lads, Iceland's equivalent of Santa Claus, who leave presents for the good and potatoes for the naughty.
But amid the comforting rituals, Iceland's 320,000 people are facing a wintry economic blast after a decade of boom that turned their island into a Nordic financial powerhouse with one of the world's highest per-capita ownership levels of high-end Range Rover sport utility vehicles. Now, austerity is in the air....
Icelanders founded the world's first parliament, the Althingi, in the 10th century, their country fell under Danish rule for centuries and became fully independent in 1944. Iceland used to be so dependent on a single industry - cod fishing - that three times between 1958 and 1976 it risked war with the British Navy over fishing rights. In the '80s annual inflation ran up to 85 percent. History may have predisposed Icelanders to make the best of the good times while they lasted.
Financial deregulation and a 1990s stock market boom produced a decade of debt-fed economic expansion that saw Icelandic entrepreneurs snap up businesses around the world. Many Icelanders joined in the lending-and-spending spree, taking easily available loans to buy houses, holidays, and expensive cars. Now Iceland's currency, the krona, has collapsed, prices of imports have soared, many businesses are approaching bankruptcy, hundreds of people are being laid off each week, and the government is seeking $10 billion in outside aid.
"People are sobering up," said Thorbjorn Broddason, a sociologist at the University of Iceland. "In recent years money has been the king in Iceland. Successful people were those who were making lots of money. You walked around and wondered: 'Why don't I have a jet-black shiny SUV? What's wrong with me?' I think this is going to change drastically. People are going to value loyalty and moderation."Americans aren't there yet. We still buy the lie.
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And in AmeriKa?
"More people getting crafty this Christmas" by Associated Press | December 14, 2008
WEXFORD, Pa. - .... Nationwide, crowds came out on Black Friday - considered one of the busiest shopping days of the year and a traditional start of the holiday shopping season - and spent about 3 percent more than last year. But analysts predict that will slow down....
--more--"I'm not even going to dignify the propaganda except to relate my Xmas experience yesterday:
I went down to the nearest mall (about 20 miles away), and the scene was putrid. It was unlike any Christmas I have ever seen around here (even last year). The parking lot was about half as full as it has been in past years; the inside of the mall had several stores and shops closed, and the food court has been decimated; and there was no NEW MERCHANDISE available. It looked like the SAME OLD THINGS that had been sitting on the shelves.
Needless to say, I only found that one item I was looking for. I didn't purchase anything else, didn't even find any ideas. It left me very depressed after optimistically starting the trip. Even this childish old man found nothing of cheer this year, and that's never happened before. The mall excursion put a capstone on the experience.
