It's worth keeping an eye out for developments on the Iceland story. The stock market might be a rollercoaster, but it has little to do with the underlying financial situation. Iceland's banks held a lot of accounts from all over the world, especially Britian. British commentary has already turned quite sour and the British government has acted to freeze whatever Icelandic assets they can.
According to the Daily Mail, Iceland owes the world 19,743.2 U.S. dollars for every citizen (I googled the exchange rate). In order to pay, they'll need a massive influx of cash, but what kind of controls does a lender get in that situation? Also, if the loan is merely in another country's fiat money, well, how is that much different from the defunct Icelandic currency? Wouldn't the same risks continue to apply in Iceland and perhaps also open up the lender nation to similar troubles as well?
We shall see.
Update: Iceland's asking Russia for a 4 billion euro loan. Well, that'll make for some interesting changes in world politics.
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