The national currency, the krona "has ceased functioning as a currency outside Iceland" according to the WSJ. Iceland now has the financial underpinnings of a third world country - and they would be the equivalent of a fourth-world country if there were any.

This all matters because Iceland is NOT a poor, underdeveloped African or Asian country which you didn't even know existed until some movie star decided to adopt a kid from there.

Iceland is bankrupt. Period. Iceland can't find people or countries which want to lend it money to cover the bank shortages. If, as the WSJ points out, "Iceland's tiny treasury can't back its banks' obligations then that the country might default on its sovereign debt. That could have a cascading effect on other small, debt-ridden countries."

The collapse of Iceland's financial system may, as historians look back on 2008, be the financial equivalent of the assassination of Archduke Ferdinand.

The big city bankers are now out of work and are heading back to their villages. But it won't be easy. The head of Iceland's biggest fishing company warned "bankers who might want to return had better be prepared to get wet. 'We have very small overhead, so we will not be hiring a lot of office people,' he says."

Maybe that should be the motto of all those who have lost there jobs in the go-go American financial industry and are looking for new careers: You'd better be prepared to get wet.