Tag Archives: Iceland

Iceland: Volcanic Update

It’s not only the sun that’s heating up, so are the volcanic activity at Iceland. According to the Modern Survival Blog, ash could begin to reach parts of Scotland as early as Tuesday followed by Britain, France, and Spain while a powerful Icelandic volcano named Grimsfjall (“Grimsvotn”) continues to erupt there at the Vatnajökull ice cap – Europe’s largest glacier.

“First estimations show this is 10 times larger than the 2004 eruption.”

eyewitness

One observer says, “There was no warning at all…approximately 20 minutes from first quake to eruption.First estimations show this is 10 times larger than the 2004 eruption.”

There were some expectations that the next eruption at Grimsfjall/Grimsvotn would be stronger, due to increased bulging inflation in the area, but the powerful explosion and ash plume reaching as high as 25 km, caught many out, the ModernSurvivalBlog writes.

A curious observation followed the initial quake swarm and eruption. Once the magma reaches the surface, the quakes typically stop.

With Grimsfjall/Grimsvotn, another earthquake swarm persisted to the east.

There is also renewed earthquake activity to the south, at the Katla volcano region, which itself is a time-bomb waiting to unleash its fury.

Locally, the immediate threat is ash-fall, which this time is of a heavy consistency.

Threats of glacial water flooding persist due to the intense volcanic heat melting the ice.

Further away, European air traffic control are working with Meteorology Offices to determine the path of the ash cloud and the impact it may have on European air traffic this week.

One year ago, much of European air traffic was shut down for 6 days from another Icelandic volcano that blew its top (Eyjafjallajokull), leaving countless stranded travelers and a dent in the economy.

Magnus Tumi Gudmundsson, Professor of Geophysics at the University of Iceland, says:

“We see some signs that the power is declining a bit, but it is still quite powerful,” adding that the eruption was the most violent at the volcano since 1873.

The potential disruption during the upcoming week will depend on the atmospheric wind patterns, and the ongoing strength of the eruption itself.

Related by the Econotwist’s:


Comments Off on Iceland: Volcanic Update

Filed under International Econnomic Politics

Scientists Gather Around Katla, Volcano Giant Close To Eruption

A sudden grouping of earthquakes at and around the volcano Katla in Iceland during the past 24 hours is cause for concern. Approximately 50 earthquakes have suddenly popped around the region, according to the Modern Survival Blog. The most alarming is that the last 6 have rumbled right beneath and within the Katla volcano caldera  itself – the most caldera quakes in one day since this author began monitoring the Icelandic volcano 7  months ago. International geologist is now setting up new equipment in the area.

“If that wasn’t enough cause for concern, earthquakes are also rumbling around the volcano that erupted last April (Eyjafjallajokull), the one that shut down European air traffic for several weeks.”

ModernSurvivalBlog


A few weeks ago, Eyjafjallajokull began showing signs of activity once again, the activity being new earthquakes. Having been mostly quiet since the eruption ended early last year, Eyjafjallajokull may now be indicating that it has more in store for us, the blog reports.

However, of greater overall concern is the Katla volcano.

The Katla Eruption of 1918

Reason being, it has the potential to explode with up to ten times the force of that of its neighbor, Eyjafjallajokull.

“The last Katla eruption was during 1918, 92 years ago, and is way overdue for its next wake-up call.”

The average time between explosive Katla eruptions has been 52 years since it erupted in 30 AD. Katla has erupted 38 times since.

Since May, 2010, approximately 132 earthquakes have rumbled within the Katla caldera.

The concentration of these earthquakes appear to be located in three general areas, as shown in the following image.

The largest concentration looks to be near the eruption of 1755, with nearly an equal number located near the eruption of 1918. There is also a build up of quakes along the northeast rim.

“We know that it is only a matter of time before this volcano blows its top. The explosion could be the biggest we’ve seen in a long time around this planet. Katla has exploded with a VEI 5 in the past (that’s pretty big).”

According to ModernSurvivalBlog.com,  new detection equipment has been installed around the Katla; Eyja region.

“If accurate, this could explain some of what we may be seeing. My own experience tells me that newly installed systems (any industry) take a while to tweak out issues. We’ll see how this plays out. Apparently just days ago, new, more sensitive seismometers (and more of them) have been brought online having been installed around Katla and Eyja, and financed by the British Geological Survey. The reason for the British funding for the new seismometers and software is to give better clues and more advanced warning before Katla does eventually go ka-boom. Even they know its history.”

Related by The Swapper:

2 Comments

Filed under Technology

Spanish CDS Spreads Surpass Iceland

This was unthinkable only a year ago: Iceland‘s sovereign CDS spread being closer to the German benchmark than the Spanish. This means that the credit market believes that it’s safer to lend money to a bankrupt little community out in the North Sea rather than to the ninth largest economy in the world.

“The problem is that Greece, Ireland and Iceland all said the same thing shortly before they were forced to receive help.”

Gavan Nolan

This is an apple!

The Markit iTraxx SovX Western Europe hit 190 basis points for the first time, Friday. Spain and Portugal hit record wide of 325 and 515 bp’s respectively. Ireland’s bailout last weekend has caused the credit markets to hone in on the other likely candidates for financial distress; Portugal and Spain.

“Ireland and Iceland have been compared often in the last two years. The two island nations in the North Atlantic are emblematic of the excessive financial debt that precipitated the global recession,” credit analyst Gavan Nolan points out in Markit Credit Wrap.

A recent blog post by Paul Krugman highlights Iceland’s strong performance relative to Ireland since 2009, which he attributed to the Nordic country’s “heterodox” economic policies: capital controls, a large devaluation and considerable debt restructuring.

“The CDS market reflects this view – Iceland’s spreads are trading at half Ireland’s level. Even Spain is now wider than Iceland, a scenario that would have seemed far-fetched at the beginning of this year,” Nolan writes.

Adding: “The dire fiscal state of the eurozone’s peripheral economies is well-established. But the last week has seen the situation deteriorate, with sovereign spreads reaching unprecedented levels today.”


Both Portugal and Spain were forced to issue denials that they needed external support today.

Portuguese government spokesman says that reports of fellow EU members pressurizing Portugal into accepting a bailout are “totally false”, Financial Times report, The passing of the government’s austerity budget – a major point of contention with the opposition parties – did little to relieve the pressure on the sovereign’s spreads.

Meanwhile, Spain did also issuing robust denials of bailout rumours. The country’s prime minister Jose Zapatero says  there is “absolutely” no need for a rescue.

“The problem for both countries is that Greece, Ireland and Iceland all said the same thing shortly before they were forced to receive help. Investors are all too aware of the credibility issue, and this is reflected in sovereign spreads,” Gavan Nolan writes.

More details of a bailout that is definitely happening, that of Ireland, are expected over the weekend.

A report in the Irish Times today that revealed the timetable caused bank spreads to widen sharply.

The report indicated that the EU-IMF mission in Dublin is looking at ways of making senior debt holders share the burden of the bailout, i.e. taking haircuts.

“A fear of such a measure has been bubbling under in the markets for some time now, particularly after the Anglo-Irish Bank debt exchange “offer” was first announced. If does come to fruition then it will be a significant moment in the recent history of financial market,” Nolan notes.

“Senior bondholders will no longer be considered untouchable, and this will inevitably have an effect on bank borrowing costs. On the other hand, if there is no mention of such a measure then it could cause spreads to snap back,” he concludes.

.

In other words – it’s gonna be another interesting Monday…

.

Select Your Language:

English * Arabic * Chinese * Danish * French * German * Hebrew * Italian * Japanese * Norwegian * Portuguese * Russian * Spanish * Swedish * Turkish

Comments Off on Spanish CDS Spreads Surpass Iceland

Filed under International Econnomic Politics, National Economic Politics