Tag Archives: financialsystem

If you have half an hour or an hour to spare, this Michael Lewis article on Iceland in Vanity Fair is an interesting read. It’s intent is about the financial implosion of the Icelandic economy, but wanders a lot to talk about the culture and weirdness of the people. It’s necessary though, because it goes to illustrate their quirkiness and misplaced self-confidence:

A handful of guys in Iceland, who had no experience of finance, were taking out tens of billions of dollars in short-term loans from abroad. They were then re-lending this money to themselves and their friends to buy assets—the banks, soccer teams, etc. Since the entire world’s assets were rising—thanks in part to people like these Icelandic lunatics paying crazy prices for them—they appeared to be making money.

I’m really fascinated with Iceland, more than I am with Scandinavia; because their in funny position where they were an isolationist culture a la the lost cultures of the amazon, but integrated enough to exist as a first civilization. The article is really fascinating, including gems like turning Cod into PhDs (I guess they didn’t read this article), and this nutty tidbit:

Alcoa, the biggest aluminum company in the country, encountered two problems peculiar to Iceland when, in 2004, it set about erecting its giant smelting plant. The first was the so-called “hidden people”—or, to put it more plainly, elves—in whom some large number of Icelanders, steeped long and thoroughly in their rich folkloric culture, sincerely believe. Before Alcoa could build its smelter it had to defer to a government expert to scour the enclosed plant site and certify that no elves were on or under it. It was a delicate corporate situation, an Alcoa spokesman told me, because they had to pay hard cash to declare the site elf-free but, as he put it, “we couldn’t as a company be in a position of acknowledging the existence of hidden people.”

In a way though, the PhDs do matter, and they are smarter than us. I mean they can see that the global financial/monetary system is a game and they are just manipulating it for their benefit. Their recklessness sometimes ends in disaster, and this is one of those cases.

Posted by Kevin in Blogs Tags: elves, financialsystem, gradschool, iceland, michaellewis, recession