Signpost Says: "Welcome to the 21st Century" - scribbles and lies
Apr. 8th, 2009
12:55 am - Signpost Says: "Welcome to the 21st Century"
I am going to assume that you haven't been encased in a solid block of ice for the last year and have therefore heard that there is a pretty significant global economic crisis in full swing at the moment. And probably for a great many future moments as well.
If you've been reading up on the whole mess instead of hiding your face from the news in shock and horror - and I'm not judging you if you've taken the latter route because frankly I don't think it's any less valid a response - you may have also heard about Iceland and how it's sort of turned out to be a poster child for the whole financial catastrophe. You may have read somewhere that the country more or less reinvented itself a few years ago as an investment banking juggernaut; unrestrained by rules and regulations and economic theories of history, they were the shining example of just how fast and far the Totally Free Market could take people who were ambitious, smart, and unafraid of risk. You may have known that Icelanders were making themselves insanely wealthy engaging in a sort of spiraling money-speculation trade involving their own currency, the ISK (Icelandic króna), and foreign currencies. If so, you are probably also aware that on the 10th of October last year, the ISK collapsed so completely (as the last of the Icelandic banks was put under government control) that it was suspended from world currency trade and effectively ceased to be recognized as valid money anymore. The country now owes something like nine times as much money as it - the whole population and government and all the nation's resources - are capable of producing, and it has nothing to pay that debt with except fish.
Unless you are a computer nerd type, you may not have heard of a thing called EVE Online. It is, to be perfectly blunt, an internet spaceship game. You have a spaceship. You fight other people's spaceships and take their stuff. You team up with other players so that you can all beat up other people's spaceships more effectively and take more stuff. Or you can try to legitimately accumulate valuable resources and sell them for a profit in other parts of the universe that need them... so long as nobody comes along and beats you up and takes your stuff. In most of the game's universe, the only laws are those that the players make and enforce for themselves and each other. There is nothing preventing a very powerful group of players with very powerful spaceships from taking and controlling the entire supply of a vital in-game resource and driving its price into the ceiling (or the floor) except other players. It is the ultimate expression of the Totally Free Market as a computer game.
It probably won't surprise you to learn, at this point, that the software company that developed EVE Online is Icelandic. That company, CCP hf, continues to draw in revenue of several tens of millions of dollars annually from a subscriber base that is almost entirely outside of Iceland. Which means they are paying to play the game in almost any and every currency on the planet that is not the ISK. It would not surprise me if CCP hf, at this point, is the single largest influx of actual hard, usable currency into the Icelandic economy.
EVE Online has its own in-game currency. Virtually all such games do. And with in-game currency comes real-world speculation - because if there's one thing every multiplayer internet game develops, it's a market in which people with real-world money can acquire whatever they want in the game by simply paying someone else for it. Warcraft has "gold farmers", players who play the game for no other reason than to amass wealth that is then sold in huge batches for cash through eBay-like channels. It's their job - quite literally in many cases, especially in China, where entire facilities are staffed around the clock with game-players who play all day and all night to earn the rare items and mountains of money, so that their boss can then sell it all to Westerners who just want to win without actually playing first.
The in-game currency of EVE Online is the ISK. That's right, the Icelandic króna. And where most multiplayer games have attempted to ban the translation of in-game assets to and from real-world money, EVE Online has not only permitted it but actively embraced it - so much so that daily speculation on world/game financial leverage is conducted openly on the official game web boards. As a result, the EVE Online ISK has remained fairly stable against virtually all the real currencies of the world for a few years now, fluctuating but not spiking, not crashing. There are people out there making an income, a real-life income, just handling the trades on the "floor".
All of which is to say: Iceland has collapsed so thoroughly that at this point, its only economically viable export may very well be an internet spaceship game, and that internet spaceship game's króna is for all intents and purposes a more real and valid and valuable currency than the actual country's actual money.
For consideration: You may have also heard of Second Life, a multiplayer game that lets people turn themselves into a six-breasted moose and build their own private dungeon where hairy flying penises shoot fire at them all day and all night. Second Life's in-game currency is, of course, the dollar.