09 October 2008

october freeze

Yesterday morning was one of those beautiful magic-light and pink clouds that make me remember why I love it here. It's hard right now, since the chaos that has hit the international news is unfolding here around my ears. Just like with the earthquake a few months ago, I've been getting questions from people all over, asking me if we're bankrupt, if I'm ok, so here it is.

The thing is, for the time being, life has not changed so much in the daily activities. I am sure it will but the extent of the change is still totally unknown to us. It's pretty evident that the building boom was not sustainable as it was since there is not enough population to own and live in all of those apartments, and now that's the same problem that's going on with the banks that are simply far too large for the GDP of this country. There are just not enough people or money here. I knew it wouldn't last but didn't realize that they way it would collapse would take everyone down so severely.

A few months ago there was a big rumpus over a group called "Ísland fyrir Íslendingar" (Iceland for the Icelanders), an anti-immigration group that said Iceland should only be for the Icelanders. At the rate things are going here, they will get their wish. It started with the architects, most of whom are returning to their home countries or moving on to other places, and now others are going. The amount of savings and effort lost in the blink of an eye is phenomenal, and the blossoming exchange rate is pinching the budgets of the students to the extent that many will be unable to afford living here on their stipends if they are paying off loans in other currencies. One guy I know owns a house in his home country that he is paying off in ISK. If the exchange rate continues to spiral, he too will have to leave.

The whole thing has the effect of being in a movie- these events are so large scale and so unbelievable, the consequences so far-reaching and staggering. News all over the world has been picking up the story that the country is bankrupt, that people are panicking and stashing food and everything. I've sensed a certain schadenfreude, like "we may be dumb but at least not as dumb as those fool Icelanders." That may be true but the news I'm hearing all over the world is not really much more wonderful. Banks are collapsing everywhere, and as they do they take even more institutions down. Iceland's not alone in this and in some ways is the canary in the coal mine.

This country may be poorly located in terms of its remote location and dependencies on imports, but we do at least still have heat and electricity, fish and dairy and vegetables. Hopefully there will not be starvation and freezing this winter. If worst comes to worst (and what exactly that means remains to be seen), I will lose money, of course. Enough to hurt but nothing I can't recover. I'm lucky- I'm not on the verge of retirement and watching my savings dry up like a puddle on hot asphalt, and when I calm myself enough I remember I'm educated, healthy, I survived a move here, and I am not alone. Thanks to S and his practical positivity, thanks to my parents and their confidence, thanks to the few dollars I have squirreled away in the US, I'll get through this somehow.

So what to do? For the time being, I am still with job and home and at least one other compelling reason to stay here. My job has most of the customers abroad, paying in other currencies, and we just pulled off a not insignificant job in Norway with good success. We're moving to a brighter, nicer, more conveniently located office that I could take the bus to or even rollerblade or bike should it come to that.

I'm going to weather the storm for now, but if Iceland has now become so poisonous that nobody will trade or do business with it (based on the ratings of the country being so severely downgraded, and some people comparing the country to Zimbabwe, I can't help but wonder), I may have to update that plan. Hopefully should it come to that, I'll still have enough money to escape.


Food, she thought. said...

Thank you for the thorough update. The events occurring around us economically in world communities is a little like a sudden and unexpected terminal illness in a loved one. One watches to see how the events will affect us, in surprise and awe. However, life must go on. We wake up each day and go to work. We find reasons to laugh, good things to eat and joy throughout the day. Life goes on. But all the while, in the back of our minds we are waiting and watching for the axe to fall.

Please, continue to keep us all posted. I am worried for you and for all of us.

Professor Batty said...

... Like everyone, I am stunned by these recent events. I hope that you and all the Icelandic people weather this storm. Thanks for letting us know you are alright.

Anonymous said...

This is a real eye opener for me. I am in awe of what you have just told. Its rather frightening to hear. I cannot imagine what it would be like. Im in Australia and all this seems so far from home. Our government is constantly telling us that we are well prepared for this. But now is understand the severity of it all. But i am only 18 and no next to nothing on economics.

Arcadian Advocate said...

I have visited Iceland several times and loved both the landscape and the people. This is all so terrible, for everyone.

I do strongly believe in the self reliance of the Icelanders as a nation, however it is the way these global events are linked that make it all so frightening, and we wonder which country may be next? Self sufficiency is vital, but may not be enough on its own to weather this financial hurricane.
Nevertheless I believe if you look back even to 1929 you can see that economic events, like farming, are cyclical so we have to hope and beleive in better times soon.

Thank you for keeping us posted.

Brenton said...

Ah. If we were to get rid of the monetary system none of this rubbish would happen.