Iceland Mag

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Iceland Mag

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Bankers Behind Bars: A guided walking tour through the collapse of Iceland's banking system in 2008

By Staff

  • Battered Former prime minister of Iceland, Geir Haarde, needed police protection when leaving the office in his car, during the massive protests in 2008-2009. Vilhelm/Gunnarsson

The recent sentencing of several top executives of Kaupthing, the largest and most aggressive of the Icelandic banks, to long jail terms for market manipulation in the lead up to the 2008 crash, reminds us that recent history in Iceland is just as dramatic and unique as its nature and geology. Less than seven years ago Iceland experienced one of the largest financial crises in modern history as its three largest banks collapsed, bringing down with them the currency and much of the economy.

The events since the collapse of 2008 are equally remarkable. In the winter of 2008-9 Icelanders took to the streets in the “pots and pans revolution”, which has been seen as an inspiration to protest movements across Europe. Iceland has also sentenced more bankers and high-flying financiers to jail than most other countries.

Why are the bankers being jailed?
Since then Iceland has been used as both an example of the worst excesses of the financial bubble which burst in 2008, and as an example of how to deal with a financial crisis.

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Strong words This is the most famous protest sign in Iceland's history. The literal translation is "Goddamn fucking fuck". Photo/Stefán Karlsson

Chances are you have heard something about some of this history. But what exactly happened? What was really behind the Icelandic Financial Miracle? Why did the Icelandic banks Collapse? Was it all just a giant Ponzi scheme? What was the “Pots and Pans revolution” all about, and why have Icelandic bankers been sentenced to jail?

Now you have a chance to get answers to all of the questions in a new walking tour of Reykjavík.

Walk the crash with an expert
This summer the largest and most popular of the walking tours of Reykjavík, citywalk.is, is adding a guided tour through the causes and consequences of the collapse of the banking system in 2008.

Magnús Sveinn Helgason, an economic historian and expert in Icelandic financial history, will take visitors on a tour of some of the sights of the “financial miracle” of Iceland, and the “pots and pans revolution” of 2008-9.

It is fair to say that Magnús is an expert in the topic. He worked for the Althing Special Investigative Commission on the collapse of the Collapse of the Financial System, and has taught economic and financial history at the University of Bifröst since 2010.

According to Magnús the walk should not only be informative or a “crash course in the financial crash”, but fun and exciting. “What could be more exciting than the story of how a tiny country was turned into a giant hedge fund, only to blow up?”

All further information can be found at citywalk.is

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