Iceland Looks For Overseas Help In Dire Financial Crisis

REYKJAVIK (Reuters) - Iceland looked for help from new partners on Monday to dig it out of a crisis that has overwhelmed its once-flourishing financial sector.

A central bank and finance ministry delegation left for Russia to begin talks on an emergency loan worth potentially billions of euros, a central bank staffer said.

Ministers said the north Atlantic island nation should now consider joining the European Union to safeguard the economy -- a step that in the past has been blocked by the country's influential fishing sector.

Read the whole story here.

Comments

[rockyersocksoff]

This just in:

GOP VP nominee Sarah Palin weighed in with a solution.

Speaking at a baby seal slaughtering plant in Christrifle, Alaska, Palin opined

"Well, with all this supposed man-made 'Global Warming' running around willy-nilly, maybe the Icelanders can pull up the bootstraps of, ya know, their economy by selling the rest of us some of that gosh-darned ICE they're always yammerin' about. I know I like a good glass of ice tea with my baby seal jerky!"

[ShakeYourComplacency]

I'm surprised that Iceland is failing, because they're so small. I can undertand the Big 8, with their stock markets and economies heavily connected (Japan, etc) but I thought countries like Iceland were more independent of that system. It's scary that they're not.

I guess there's no such thing as national financial sovereignty anymore. The richest folks really do run the world and have us all tied together. Canada, however, seems to be doing much better. In fact, people are investing in Canada. Just one more right thing they're doing, among other things.

By the way, given the complex financial problems we're going to face in the next few years, I'm glad it will be Obama in the whitehouse instead of that unstable maniac. That's one relief, anyway.

[curly2]

I think one of the problems is that they are so small. They have an economy that's based on service, with banking services comprising a considerable portion of the economy. Since they decided not to join the EU, their currency has the tendency to fluctuate considerably-- since they import almost everything (with the exceptions of some staples like fish and lamb) this has driven the price of necessary goods up considerably in the last 2 months.

Also, from what I understand, none of their banks are guaranteed by the Icelandic government. It appears Iceland is going to guarantee them now, but only for Icelandic citizens. EU citizens who invested in Icelandic banks will be out of luck-- and that means money is getting taken out of those banks, and won't be put back in when the crisis is over.

[Cmdr UK]

Maybe Hugo Chavez might step up to the plate?

[harriettubman]

Sorry Iceland, the U.S is having a cash crunch right now. They have helped the bankers, Wallstreet and everybody but the poor homeowners.

[darthdarcy]

Build Casinos...!

[DAdvocate123]

The Left was always telling me that Iceland is the greatest place to live on Earth.

[Rule Of Law]

It was, before the Right--The IMF and World Bank--decided to take them down!

[Deluded]

Who on the left was telling U this crap- the price of drink there is totally out of order. Besides I read somewhere that they have one of the highest suicide rates in the world. Anybody who told U Iceland is the greatest place to live on earth for sure hasn''t been there.

(No offense intended to any Icelanders who may be reading this.)

[lejman]

heard this on npr last week...welcome to our world.

[Paul]

I understand the whales are taking up a collection to buy Iceland...

[Paul]

Can you foreclose on an entire country?

Is it for sale?

Is Warren Buffet going to make a move?

[hypnotoad72]

Mr Buffett once said an insightful line... Something like "Saints have a past; sinners have a future."

I'll listen to a saint long before a sinner. The sinner still needs to make that future. Saints have been there and done that, which does not make them hypocrites but reminders as to why it's best not to do it in the first place.

[PineyWoods]

Poor Ireland ... a new International Finance case study for all the wrong reasons.

[AmandaBC]

Ireland?

[GE]

Common mistake. Before email (like, a century ago) the letters from my friends in the US took eternity to reach me, and usually the envelope was stamped "Missent to Ireland".

[AmandaBC]

This is what happens when your entire economy relies on US jungle-law capitalism. A good lesson for Canada and Europe. I hope they learned something.

[MagisterLudi]

1.Iceland's downfall cannot serve as an to Europe because Iceland IS in Europe. Take a look at the map.
2. Countries subject to the economic downturn include those with strict governmental control of financial sector ( Netherlands, Sweden, Russia, Iceland) as well those closer to laissez-faire American/Canadian model.

[totalliberal]

Canada's heavily regulated banks have been voted the most secure in the world by the world economic forum.

http://www.financialpost.com/story.html?id=870688

How about doing a little research Majister Ludicris.

[AmandaBC]

"1.Iceland's downfall cannot serve as an to Europe because Iceland IS in Europe. Take a look at the map."

You take a look at a map. While politically Iceland is part of Europe (although not of the EU), geographically it's not. No wonder Iceland's main trading partner is the US, despite all the cultural ties to Scandinavia.

I'm glad you're finally realizing this is a crisis unseen since 1929, and not just part of a "business cycle", as you previously claimed. And BTW Canada's financial system is VERY different from that of the US and a lot more regulated. But, of course, how could you possibly know that?

[curly2]

Iceland is technically on both the North American continent and the European continent. If you're ever traveling in Iceland you can scuba at the place where the plates meet.

[HerbTee]

For all those White folks who're espousing if a Black man (Obama) wins the White House, they'll leave the country? Well, here you go folks...simply give up your US citizenship and move over to Iceland, which likely has a 99.9 percent pure White population. You'll be safe, happy and financially secure there without too many Black folks to worry about. Yeah, right!! :-P

[MajorKong]

I've been there. Everybody looks like they stepped off a Wehrmacht recruiting poster circa 1940.

[MagisterLudi]

Nothin' like racial p_rejudice, eh pal.

[Cmdr UK]

That's a pretty nasty comment.

[totalliberal]

You're right. They are among the most xenophobic, smug people in the world...... "Now" they want outside help.