Wall Street Collapse Ripples To Island Countries The global financial crisis has wreaked havoc far away from Wall Street. In Ireland, banks were seriously overexposed to mortgage debt, and in Iceland, which teetered on the brink of bankruptcy, polls showed a third of the population was considering emigration. Writers Andri Snaer Magnason of Iceland and Anne Marie Hourihane of Ireland talk about the economic roller coasters in their countries.
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Wall Street Collapse Ripples To Island Countries

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Wall Street Collapse Ripples To Island Countries

Wall Street Collapse Ripples To Island Countries

Wall Street Collapse Ripples To Island Countries

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The global financial crisis has wreaked havoc far away from Wall Street. In Ireland, banks were seriously overexposed to mortgage debt, and in Iceland, which teetered on the brink of bankruptcy, polls showed a third of the population was considering emigration. Writers Andri Snaer Magnason of Iceland and Anne Marie Hourihane of Ireland talk about the economic roller coasters in their countries.

JACKI LYDEN, Host:

And as the guardians of the world economy meet to try to mitigate the deepening recession in advance of the G-20 summit, the effects of the crisis continue to spread.

T: We're joined by Andri Snaer Magnason from Iceland, and Anne Marie Hourihane of Ireland. Both our guests are writers from their respective countries, and they explore the impact of the swing economics on everyday life. Welcome to both of you.

M: Thank you.

M: Thank you.

LYDEN: Andri, let me ask you to give me a scene that for you, was the top of Iceland's boom.

M: I would say that 2007, where the bubble money was really flowing into the economy. Our stock market had nine-folded in about five years, I think. The local airport was cramped with private jets, and out of one of the jets came Sir Elton John singing in a birthday party.

(SOUNDBITE OF LAUGHTER)

LYDEN: Well, Anne Marie Hourihane, I don't know if you can top that. You wrote a book called "She Moves Through the Boom," the Celtic Tiger boom. Could you tell me something from Ireland that strikes you?

M: And now, our bankers have been shown to have been really inept, and people are really furious, and it has had a very serious personal effect. A lot of people lost a lot of money, and a lot of people are very, very frightened and above all, very, very angry.

LYDEN: Andri, could you tell us what happened in Iceland? I know it's a complicated story, but give us a writer's narrative.

M: And at the same time, the government decided to double aluminum and energy production in Iceland. So, into the economy at the same time was flowing like $3 billion, and that caused optimism. So, people started to take loans. Housing prices doubled in a very, very short time.

LYDEN: One of the descriptions I've heard about Iceland is that it is as if the big banks essentially became like one giant hedge fund, and then of course, last fall, the crash. Could you tell us about that?

M: Yeah, well, I always thought that it was some kind of a metaphor, one giant hedge fund. I thought it was something clever from a journalist, and we were always told not to interfere in what the banks were doing and not to have an opinion on it, and we never knew that if it would crash, it would fall into the hands of the public.

M: When Iceland really hit big trouble, there was a joke going around Dublin. What's the difference between Iceland and Ireland? The answer was one letter and three months. And that has pretty well proved to be true. People came home from abroad and said they didn't recognize the country anymore because everyone was so angry on the roads, so stressed out, and consumption was so conspicuous. They now have more time to say hello and be civil to you.

LYDEN: Andri, I'm just wondering what you think might lie ahead.

M: But then, there's this global recession, and our opportunities come in parallel with opportunities in the world. But in general, if you just look out of the window, and if you were a child, you would see that the schools are there, and the hospital is there, and the medicine is there, and the roads are there. So, the whole system, really, still works.

LYDEN: What do you think is immediately ahead for your country?

M: So, people feel very angry that the money that was made in the boom was squandered.

LYDEN: Your last book was called "She Moves Through the Boom." Are you thinking of writing another?

M: Oh, yeah, I am writing another. It's called "She Moves Through the Gloom."

LYDEN: "She Moves Through the Gloom." All right. Has it changed your writing, Andri?

M: Maybe one of the things is that everything is happening so fast that it would be hard to write fiction because reality is kind of - has the upper hand. My latest book was called "Self-Help For a Frightened Nation." So, I think that one will be in print for a while.

LYDEN: I'm happy to see that the humor quotient is at least well-topped up for both of you. Anne Marie Hourihane is a writer with the Irish Times, and Andri Magnason is a fiction writer from Iceland. Thank you both so very much for speaking with us today.

M: Thank you very much.

M: Thank you very much.

(SOUNDBITE OF MUSIC)

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