Glitnir. Kaupthing. Landsbanki: The unholy trinity of failed banking in Iceland.
In an article called Wall Street on the Tundra in the current Vanity Fair, Michael Lewis is both disrespectful toward individual Icelanders and critical of Iceland's entire financial structure. He brings some remarkable statistics.
On the way up: From 2003 to 2007 "the Icelandic stock market multiplied by nine times. Reykjavík real-estate prices tripled. By 2006 the average Icelandic family was three times as wealthy as it had been in 2003...."
And on the way down: When the three banks collapsed last October, "Iceland’s 300,000 citizens found that they bore some kind of responsibility for $100 billion of banking losses—which works out to roughly $330,000 for every Icelandic man, woman, and child.... In the end, Icelanders amassed debts amounting to 850 percent of their G.D.P."
See The Iceland Weather Report for an ongoing chronicle of the aftermath.
You can buy about 114 Icelandic krona for a dollar today, up from 84 in September. Icelandair will fly you between Boston and Keflavik over the July 4th weekend this summer for about $566 R/T.
(Photo from EarthPhotos.com. See more photos in the Iceland Gallery at EarthPhotos.com.)
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