in every dark cloud there is a silver lining

Posted on October 26, 2009
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dark-cloudsToday’s lesson, is that in every dark cloud there is a silver lining.  For instance, what if you country had suffered a catastrophic collapse in its financial sector that had turned its currency into a joke, doubled inflation, sent unemployment rocketing and increased foreign debt to levels that threatened to bankrupt the country.  What could possibly be good about that? How about McDonalds closing all of its franchises?  When you think about it, in a way, its almost worth the pain, (From Bloomberg.com)

Iceland’s McDonald’s Corp. restaurants will be closed at the end of the month after the collapse of the krona eroded profits at the fast-food chain, McDonald’s franchise holder Lyst ehf said.

McDonald’s in Iceland, which imports most of the ingredients it uses in its meals, will shut after costs doubled over the past year, Lyst said in an e-mailed statement today. The franchise holder said it doesn’t expect the situation to change in the short term.

“We would have to raise our prices by 20 percent to get the margin needed on our products,” Magnus Ogmundsson, Lyst chief executive officer, said in a phone interview. “That would have sent a Big Mac to 780 kronur” ($6.36), compared with the 650 kronur it costs today, he said.

The island’s currency collapsed last year following the failure of Iceland’s biggest banks. Offshore, the krona slumped as much as 80 percent against the euro, while capital restrictions this year have failed to prevent an 8.1 percent decline, making the krona the second-worst performer of the 26 emerging-market currencies tracked by Bloomberg.

“Our competitors all use domestic meat and lettuce and so on, while we are flying in these materials, which is extremely expensive,” Ogmundsson said.

BigMac Index

The most expensive Big Macs are sold in Switzerland and Norway, where the burger costs about $5.75, according to the Economist 2009 BigMac index. The cheapest are sold in South Africa, $1.68, and China, $1.83, the index shows.

McDonald’s, the world’s largest restaurant chain, opened its first store in Iceland in 1993. The first person on the island to consume a Big Mac was then Prime Minister David Oddsson, who later became governor of the central bank before his dismissal by the current ruling coalition earlier this year. The island has three McDonald’s restaurants, all of which will be closed.

Silver Lining two

And then there’s Somalia, an international pariah, lawless, sunk deeply in the mire of chaos, beset by crime and terrorism, heartbreakingly poor.  A place whose seas are declared a no go zone by the entire world for fear of piracy. What could possibly be good about that? How about the fact that none of the super trawlers of China and Japan enter its waters anymore, meaning local fisherman’s catches have risen from a meagre ten dollars  a day to four hundred dollars a day.

(From Channel Four)

Fisherman in Kenya have reported bumper catches of shark and shellfish because commercial fishing boats from China and Japan have been scared away.

Now the fishermen are able to catch up to £200 worth of fish per day in an area where the average daily earnings are less than £5. The massive factory trawlers which used to drain their fish stocks have been scared away and that means there is a huge bounty for local fishermen as well as helping to restore the health of the marine eco-system.

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