Potential trouble in Eastern Europe

[2952-0-0]

There are signs and rumours that Latvia will be forced to withdraw from the ERM very soon, with a large devaluation. Without a doubt this will cause euro-denominated loans to fall into default, and will definitely kill the other currency pegs in the region, setting off a wave of bank crises.

Stay tuned.

[Tetro Kornbluth]

There was an article in The Times today. Seems to be widely expected. I'll leave it up to the economic experts here to decipher its potential significance.

[Beet]

It hardly takes a genius to figure it out. People here have been talking about the possibility of such an event since last year.

[Gustaf]

Yeah, this has been obvious for a year or so. (actually, if you want to be really arrogant it's been obvious for several years. You don't peg your currency to another and then run an inflation 2 or 3 times higher than that of the other currency)

Anyway, this may finally kill off the Swedish bank sector. Especially Swedbank, their stock fell 17% two days ago when this was announced.

[Sam Spade]

Yeah, this has been obvious for a year or so. (actually, if you want to be really arrogant it's been obvious for several years. You don't peg your currency to another and then run an inflation 2 or 3 times higher than that of the other currency)

Anyway, this may finally kill off the Swedish bank sector. Especially Swedbank, their stock fell 17% two days ago when this was announced.

At least your country is doing it right by telling the bankers "No free money, we'll take you over instead and liquidate your crap."