The End of Iceland's Innocence: The Image of Iceland in the Foreign Media during the Financial Crisis

Chronology

– 218 – CHRONOLOGY A FEW HISTORICAL POINTS OF REFERENCE 874 Beginning of the settlement of Iceland. 930 Beginning of the ‘Saga Age’. 1000 Iceland becomes Christian. 1262 Iceland is brought under the Norwegian crown. 1380 Iceland is brought under the Danish crown. 1944 Following a referendum, Iceland proclaims its independence. 1975-1976 Tense diplomatic relations between Iceland and Great Britain over Iceland’s fishery limits, escalating into a ‘Cod War’ which Iceland wins. 1980 Vigdís Finnbogadóttir is elected President of Iceland—the first woman to be elected a constitutional head of state in Europe. 1982 Davíð Oddsson is elected Mayor of Reykjavík, an office he would hold until 1991. 1989 Jón Ásgeir Jóhannesson and his father, Jóhannes Jónsson, open the first Bonus supermarket, which would become a chain that provided a launching pad for the Baugur conglomerate. 1991 Davíð Oddsson is elected Prime Minister of Iceland, an office he would hold until 2004. Beginning of the bank privatisation policy. 1994 Iceland becomes a member of the European Economic Area. 1996 Ólafur Ragnar Grímsson is elected President of Iceland. 1998 Geir Haarde is appointed Minister of Finance, a position he would hold until 2005. 2001 Davíð Oddsson allows the Icelandic krona to fluctuate on markets. Implementation of the Anti­Terrorism, Crime and Security Act in the United Kingdom following the September 11 attacks in New York. 2002 Björgólfur Thor Björgólfsson, a ‘new Viking’ businessman, acquires a 45% share of Landsbanki. 2003 Kaupþing becomes Iceland’s largest bank following a merger. Baugur becomes the largest Icelandic conglomerate with operations abroad. – 219 – 2004 Halldór Ásgrímsson is elected Prime Minister of Iceland. He appoints Davíð Oddsson Minister of Foreign Affairs. 2005 Fraud charges are brought against Jón Ásgeir Jóhannesson, most of which would later be dropped. Jón Ásgeir Jóhannesson accuses Davíð Oddsson of orchestrating a vendetta against him. Davíð Oddsson is appointed Governor of the Central Bank of Iceland. 2007 Gordon Brown is elected Prime Minister of the United Kingdom. He appoints Alistair Darling Chancellor of the Exchequer. Britain-based professor Robert Wade gives a controversial speech in Reykjavík in which he cautions about the risks involved in Iceland’s financial expansion abroad. Professor Richard Portes and colleagues publish a report entitled The Inter­ nationalisation of Iceland’s Financial Sector for the Iceland Chamber of Commerce . 2008—THE YEAR OF THE CRISIS January 10 The Financial Times reports that the Icelandic firm Gnupur Investment ‘was forced to announce an emergency recapitalisation programme yesterday’. January 29 According to Le Monde, Iceland ranks at the top of the United Nations Development Programme (UNDP) index. The Financial Times reports that, according to Moody’s Investors Service, Iceland ’s rating was at a crossroads ‘because of the perceived fragility of the country ’s banks’. March 4 A financial adviser tells the Financial Times that markets are starting to react badly to Iceland, saying that ‘there is a general dislike of Iceland; every movement in the market gets magnified when it comes to Iceland’. March 6 Moody’s lowers Iceland’s rating. According to the Financial Times, ‘the downgrade is the latest in a series of moves by Moody’s that indicate it is gradually losing confidence in the ability of the nation to avoid a banking crisis’. Following this news, the Financial Times reports a drop in the value of the krona , stating that ‘Iceland’s krona plunged to a record low against the euro after rating agency Moody’s changed the country’s outlook to “negative”’. March 8 Le Monde reports that Iceland’s banking sector now holds assets eight times greater than the country’s gross domestic product. March 23 Iceland is likened to ‘one big toxic hedge fund’ in an article appearing in the Telegraph: ‘The story doesn’t make sense any more. Nobody wants anything to do with it.’ – 220 – March 25 Rumours of a crisis erode Iceland’s reputation. According to the Financial Times, ‘the uncomfortable fact for Iceland is that the rumours and talk of a crisis could create the crisis.’ March 28 The Financial Times reports that rumours of a conspiracy against Iceland are circulating in the news. March 29 The Globe and Mail reports that the Central Bank of Iceland has raised its key interest rate to 15% in an attempt to support the value of the krona. April...