Cold Chill: A Russian bail out facility for Iceland

Why does Island, a nation of 300,000 with a GDP of only $20 B matter? As the son of the former commander of the army of Iceland -a ceremonial title formerly assigned to the highest ranking NATO army commander on the Island at any given moment , I have some quick insights:

• Iceland is the only member of NATO that does not have a military.
• Through a long standing treaty the United Stated is bound to defend the sovereignty of the tiny island nation against any aggressor.
• The US shut down our cold war base at Keflavik in 2006 and no longer hold a lease for permanent facility there.
• Iceland holds a critical a strategic position in the North Atlantic, overlooking Russia’s only outlet into that sea.

Apart from the absurdity of the level at which the Icelandic government are attempting to peg their currency at the level they have chosen (the chart attached below show the official exchange rates, dealer banks have reportedly shown levels as much as 30% lower than the lowest level quoted here over the past 2 days) the Russian bailout also has to be leaving EU and NATO leader with knots in their stomachs: with Putin employing the Chavez method of diplomacy through distressed lending they must now consider the formerly unthinkable possibility of a Russian presence in the North Atlantic.

Andrew Barber
Director
Research Edge LLC

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