Quote:
Originally Posted by unimatrix0
How do you know those countries don't contribute? Last time I checked, they were giving more to eu than they received. You have no idea what the crisis is all about.
The real problem isn't those countries, but the banks from some western countries who financed really bad investments in this countries, like the real estate bubble. Austrian banks are the most exposed, but the french banks are doing relatively well, because these banks invested more in real economy and not in real estate. These countries will be a lot more attractive to investors now that the real estate costs are getting much lower. But the problem with the western banks is where the crisis is. They must pay for those stupid investments. The eastern countries won't loose anything, because the banks can't take the houses and the lands and move them where the prices are better.
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Yes, I think what is going on with the Swedish banks in Latvia is disgusting. Swedbank and SEB gave out loans to virtually anyone that asked for years. The Baltics alone was generating over 30% of Swedbank's profit and accounted for less than 15% of their overall expenses. Now the shit has hit the fan and Swedbank would have already gone bust had the Swedish central bank not stepped in late last year and gave them money. Now what Latvia needs to do to fix their economy is devalue their currency, but the defaults that will happen, since most loans for property are in Euros, if they do that will push Swedbank and SEB over the edge and the EU and Sweden does not want to pay for this. So they orchestrate a bailout with the IMF et al to give Latvia the money needed to artificially prop up the exchange rate their currency is fixed to with the Euro. Basically they are taking their FX reserves and buying Lats on the market. Akin to going into a shop selling your product and buying it yourself to prop up your sales. This is unsustainable and the Latvian people are the ones suffering for it. They are the ones that will have to pay all this bailout money back through taxes and it is being used for nothing more than propping up Swedish banks. It's sick. And don't even get me started about the local bankruptcy laws in the region that were largely written by people connected with these foreign banks...