It's all gonna blow now. There's no way for it not to. The over-leveraged (in foreign currency) countries of Eastern Europe are now going to fail. Their governments will fall. And their people will experience untold suffering. Again. One by one. All of 'em.
Latvia, Estonia, Lithuania, Poland, Ukraine, Bulgaria, Romania, Croatia, the entire lot of 'em.
Why?
Because they drank the REIC kool-aid and had one hell of a housing bubble. Because their people took out loans that had to be paid back in foreign currencies, and then their local currencies collapsed at the same time the underlying assets collapsed. Because their governments were incompetent and corrupt. Because a wave of British dentists gamed their property markets. And because the Western banks f*cked them, which of course has now f*cked the Western banks.
So come on down. Come to Eastern Europe this summer. Experience what happens when the world melts down. When the rage hits the streets.
I know most of you could care less about this region, and think their failure won't impact you.
And you are wrong.
Read up, understand, come on down, and get ready.
You ain't seen nothin' yet.
Eastern Europe has borrowed an estimated $1.7 trillion, primarily from Western European banks. And much of Eastern Europe is already in a deep recession bordering on depression. A great deal of that $1.7 trillion is at risk, especially the portion that is in Swiss francs. It is a story that could easily be as big as the US subprime problem.
Whether it takes months, or just weeks, the world is going to discover that Europe's financial system is sunk, and that there is no EU Federal Reserve yet ready to act as a lender of last resort or to flood the markets with emergency stimulus.
Posts
59 comments:
So how's that Obama worship working out for you, Keith?
Please consider:
Mish's - Dear Mr President, With All Due Respect
Mmmmmm, that's some Change We Can Believe In.
And don't try to back out of it Keith. We remember all of your Obamamania worshipping just a month back and your denunciation of Ron Paul.
It hath been foretold...
History will not be kind to you Keith.
Bwahahahahahahah!!
Whether it takes months, or just weeks, the world is going to discover that Europe's financial system is sunk, and that there is no EU Federal Reserve yet ready to act as a lender of last resort or to flood the markets with emergency stimulus.
And, as history has shown, this could turn out to be a Good Thing™. There are no meaningful ways to stimulate a corpse anyway, so why lose time?
News from Russia: the composite stock index stands firmly at -78% off peak in dollar value (invest now for non-numerical outcome), CPI hit by euro-denominated imports yet roubles are very scarce, unemployment up but bureaucracy very much up and alive, and safety cushions accumulated during the boom (did SWFs look really scary just one year ago?) are misused expectedly.
"...most of you could care less about this region..."
My son's best friend's family are from just outside Tallin. Wonderful people, if somewhat cynical politically. Not too fond of Russians for some reason.
Keith-Sucks-Flashback:
http://housingpanic.blogspot.com/2008/
10/heres-john-mccain-communist-wanting-to.html
Here's John McCain, Communist, wanting to rip up contracts, cut the amount housing gamblers owe, and artificially inflate home prices
Looks like Obambi did the same thing.
Europeans are overdue for a good old-fashioned war with all the genocidal trimmings.
Got NATO?
I am planning a trip to visit family in Germany this summer. Maybe I should venture on over and see how the other half lives.
Keith, let me buy you a beer.
It would be an honor.
You bring the popcorn.
Wow. When I first found HousingPANIC, I thought "Oh my God, I'm going to lose my shitbox".
Little did I know what was to come.
It sure has come a looong way since then.
Unbelievable.
I will be keeping a close eye on what is going on over there.
"If you'd like to have the once-in-a-lifetime experience of seeing the world collapse, then make your travel plans to Eastern Europe this Summer"
Sorry Keith. I can't afford to travel, buy a passport, etc. So I will just have to watch from afar.
Locally, things are still holding up here in Wisconsin. Lots of vacant store fronts built years ago but which have never had a tenant. Some grocery stores closing down. Most other stores still in business (for now). But rumors of closings abound.
Interesting, I was going to hop an Easyjet from Basel to Hungary in May when I am back in Zurich. . .always liked Budapest - not overly touristed, and good prices. . .but then I read in the Financial Times yesterday about the riots in front of Parliment building. . .do you think the Eastern Europeans have connected the dots, and will hate the US for their problems? Will they blame their governments? . . .Think I will stay close to home and visit Lake Como - if things get bad, I can escape back over the border to Switzerland. . .
My view?? Either a return to communism of fascism in most of Eastern Europe. . .I am sure there is some "Hitler in waiting" out there -
I'm thinking of heading straight into the storm, to live in EE this summer. It really will be fascinating.
Anyone want to guess where it gets the hottest?
I'm thinking Budapest, Riga and Kiev.
I'm getting a bit old to riot, but if I were your age Keith, I would be on the front lines too. . .although if a nice little riot breaks out in front of a Citibank or BofA office, I might throw a few rocks anyway!
I won't be the one throwing the bricks (being in a foreign jail isn't on my things-to-do list).
But I always regretted not being in China during Tiananmen, or East Germany when the wall came down. Or even in that Chicago park when Bush/McCain and the GOP fell.
Revolutions against the corrupt and powerful represent the greatest demonstration of the human spirit I think.
Even if sometimes the people that come to power after the revolution are just as bad if not worse as the ones that got turned out or strung up.
And then the process begins again.
In a tiny, tiny, tiny way, HP, AP and S&A were part of the current revolution. I think that's why I post and why you all come. We revolt now with words, not bullets and fire.
But in other parts of the word, I think bullets and fire are on the schedule this summer. ESPECIALLY countries that don't allow their people to revolt with words.
(russia? china? singapore?)
why?
Easy..
Not many years ago they rounded up their best and brightest hard working future oriented citizens = the pious Jewish people.
Stole all their property and belongings after taxing them to death for hundreds of years with no rights, then they murdered most of them.
Nature has its ways!
If you listen quietly you can still hear the terrible cries.
These countries are all dominos in a global economy right? When they go down, we essentially all go down, right? So...it's safe to say that it's only a matter of time before similar events happen in the U.S., right?
Hmmm...end of March is looking more and more foreboding.
I won't be the one throwing the bricks (being in a foreign jail isn't on my things-to-do list).
Keith you like Bukko are not here in the US and don't pay taxes here which is why you worshop and support Obamma. Remember. When chaos begins in Europe and asia the god king Obamma will not let you back in without siezing your moneys.
NWO making it's mark in EE. Business as usual.
Last anon - bad news for you if you want to be an expat
America is the ONLY COUNTRY ON EARTH where its citizens pay taxes on their worldwide income
In other words, I pay taxes so you can enjoy bridges, roads, schools, healthcare, etc, yet I get zero benefit
Revolution anyone?
May all of Europe burn to ashes!
Mitesh Damania said...
‘NWO making it's mark in EE. Business as usual.’
Huh?
Can you elaborate?
WTF are you smoking?
Keefer said:
‘Revolution anyone?’
Don’t ya think if we do the things they do that we’ll end up in the same place they are?
We are learning from their stupid mistakes.
F@ck Europe!
Nature Remembers said...
"If you listen quietly you can still hear the terrible cries."
========================
NEVER FORGET!!!
See America; learn a lesson from the European savers..
Ba ha ha ha ha waah ha
As has been said here many times.. Europes economy has been a façade
FAKE!
We really need to change our way of life, so that the Eurotards (AKA international community)wove us.
Waah wahh *sob*
The Eurotrash don’t respect us
Waah wahh waaaaaaaaaaaaah *sob*
Sniffle sniffle.
If only we can be as civilized as the uber-cremators and lick islamo fascist ass.
We would be soooo enlightened, and the UN will say such very very nice things about us.
TO HELL WITH ROTTEN EUROPE!
Please consider:
Mish's - Dear Mr President, With All Due Respect
Mish is the only blogger I really pay attention to. The rest is a bunch of spinmeisters. It's the best rebuttal I've seen, while the rest of bloggers were feeling a tingling sensation up their legs.
Go Israel! said...
Nature Remembers said...
"If you listen quietly you can still hear the terrible cries."
========================
"NEVER FORGET!!!"
Amen!
It will never be forgotten!!!
They will pay in the end!
Hey Keith:
Arsonists Torch Berlin Porsches, BMWs on Economic Woe
(Bloomberg) -- When Berlin resident Simone Klostermann returned from vacation and couldn’t find her Mercedes SLK, she thought it had been towed. Police told her the 35,000- euro ($45,000) car had been torched.
“They’d squirted something flammable into the car’s engine block in the gap between the windshield and the hood,” said Klostermann. “The engine was completely destroyed.”
The 34-year-old’s experience isn’t unique in the German capital. At least 29 vehicles were destroyed in arson attacks this year, most of them luxury cars, according to police. The number is already about 30 percent of the total for 2008. The latest to go up in flames was a Porsche, on Feb. 14, two days after a Mercedes was set alight in a public car park.
While youths in Athens protest by throwing Molotov cocktails, in Paris by toppling barricades, and in Budapest by hurling eggs at politicians, protesters in Berlin rage at their economic plight by targeting the most expensive cars -- symbols of German wealth and power.
A group calling itself BMW -- the initials stand for Movement for Militant Resistance in German -- has claimed responsibility for several attacks
http://tinyurl.com/bosvbj
Was in Warsaw in 2005 and then again in 2006. Just in one year prices were way up over the previous year (e.g. downtown flats).
There were young 20-something hustlers all over the place trying to lure us into buying condos (popular over there).
I had thought things would have been cheaper but prices were comparable to U.S. prices (after converting from Zlotys to dollars).
I was told to keep my mouth shut and let my Polish friend do all the talking because if they find out you are from the "west"...the price goes up.
Fuck Europe?! The too-lazy-to-think-of-a-screen-name posters here really are amazing. What exactly do you think will happen in a global economic system if a large portion defaults? ...when they can't afford our products? ...and they can't afford to produce the products we rely upon?
Simple solutions for simple minds. Think this through, jingoists!
Do you think the EE whores will be cheaper this summer?
Go Israel;
Bless you.
However, Europe must dedicate a viable independent Yiddish speaking land with clear and defined borders.
And return everything they stole from the Jewish people with interest.
Or Nature will do it for them.
RobertM;
Ummmm.
We’ll be just fine without the Eurotrash, we spent 50 years and gazillions of dollars to re-hab them after WWII.
Then they spit in our faces when we could have used at least moral support in the struggle against Islamo fascism.
This time around they’re on their own.
Let them rot.
"America is the ONLY COUNTRY ON EARTH where its citizens pay taxes on their worldwide income"
Keith, I believe this is also true of the Phillipines.....
I remember seeing this ad posted on a Miami Condo blog last year:
http://i25.photobucket.com/albums/c90/900Biscayneguy/900a.gif
The ad is targeted to European investors who "missed out" on buying properties in the "Baltics" before property values "soared". The pitch was that you can "make up for that lost opportunity" by buying a Miami condo.
Anyways, once I read that, I knew there had to be some stupid real estate bubble in Eastern Europe. Who was buying property in Eastern Europe, and why?
I think British and other European investors did quite a lot of bubble-chasing during the boom. They want to blame it on America's "sub-prime" crisis, but I believe they are in a mess that they created themselves - fueled by the same thing that drove American flippers: a desire to "get rich quick".
America is the ONLY COUNTRY ON EARTH where its citizens pay taxes on their worldwide income
Unless you are a federal contractor with the US Government, then a good portion of your income is free of federal income taxes. FICA still applies.
@SeattleMoose
Actually I am from Poland. Me and my friends actually laugh at the American government and the pace of printing money. Of course, we've seen some inflation - about 3% in 2008, but the GDP rose by 4,8% and the forecast for 2009 is 2% growth. Compare it to the contraction of US economy by 6,2% in the fourth quarter ;) Someone above mentioned the domino effect. Yes, after the US collapse, the EU collapses, we will see some recession in Poland ;) The problem is, when things are going bad in the US investors need to pull money out of our market, because of deleveraging. Therefore zloty is going down, but you can't stop what's ahead - and it's hyperinflation in the US and the collapse of US dollar against other currencies. The only thing that can help economies right now is production. We are in debt like USA, but we're still better off, as our economy is sounder. Someone mentioned credits in Swiss franc - the franc is going down too in a couple of months probably. One more thing - all this hassle about Eastern Europe in your media has only one objective - to export the crisis from USA to Europe. I don't see the crisis you're talking about here in Poland. There are some signs of it, but it's still not a major issue. It's hard for me to talk about other countries in the region, as I don't have the data. We'll see how the situation develops in the next few months, but from my point of view - may God have mercy on you, America! ;) Or you may finally rise to the call of your Founding Fathers, who are now turning in their graves. Quoting Zach de la Rocha: "Wake up to your powers as an individual and speak out and act against fucking imperialistic actions like this!"
Keith, There are members of my husband's family who were LUCKY to get out of Hungary and make a life in North America and the UK. Believe me, they were a savvy bunch, who knew how to play the game, even with heavy foreign accents. There were others who died on forced marches to Russia or committed suicide rather than face interrogation by German officers. For years those who left could not go back or communicate with family. Do you have any idea what Budapest was like under the commies? I've been there. People are afraid to talk, until they find out you are a Westerner; then you hear what they really think, what they need on the black market. Hint: Take plenty of dollar bills! And visit Lake Balaton..it's charming and relatively untouched..meaning no McMansions. The countryside is cheap and beautiful.
A depression in the US of A is a cakewalk by comparison. We do not need to be so fearful of being poor, but we do need to be fearful of losing our freedoms, especially freedom of speech.
I'm not sure if this generation of Hungarians has the strength to fight as those who did in the 40s and 50s. They've been burned. It was a crime, what our government did in the 50s. Still, most of Eastern Europe (except Bosnia etc) has more trust for the US than they do for France, Germany or the rest of the EU, and rightfully so.
Fuck Europe?! The too-lazy-to-think-of-a-screen-name posters here really are amazing. What exactly do you think will happen in a global economic system if a large portion defaults? ...when they can't afford our products? ...and they can't afford to produce the products we rely upon?
Simple solutions for simple minds. Think this through, jingoists!
February 27, 2009 8:46 PM
-----------------------
What was that all about shit for brains? State the obvious and that somehow changes things. Europe and Asia are totally F*CKED. Nothing will change that. Get over it. The US is in deep trouble, get over it. We will now find out who survives and how well. Europe has always lived under kings and dictators, ALWAYS. Socialism comes natural to lap dogs who have been owned for hundreds of years. This ownership crap these corrupt thugs are playing with in Washington will not go over here. The people of this country are already pissed.
Stay tuned dumb ass and see how this all works out. Check the shipping indexes the global economy is dead!!!!!!!! IT's not coming back. If you were capible of understanding a macro economic model this would not be so hard for you to understand. Let me put it this way debt in the US is 130 percent of income. Have your mother explain that to you.
Signed
CAPTAIN CONSERVATIVE
Yaa maybe the US will invent the magic popcicle and it will magically reballance the global joke I mean economy.
I'm not sure of that 'trust' in EE thing.
I think that the trust that was built up after the fall of the USSR is now quickly going away. I hear lots of stories when I'm there of "it was so much better under the soviets. we had jobs. we had pensions. we had stability". They see anarchy now, and corruption, and a decay in the morals and cohesion of their society.
And if that's what I'm hearing now, just think how that attitude will be after the REAL sh*t hits the fan this summer, and into the fall.
When you hear that phrase "the world will not be going back to normal after the magnitude of what they have done", one thing to keep in mind is what the impact will be on the collapsed EE countries. The West may have lost this zone for 100 years. Trust, once gone, is hard if not impossible to win back.
And hungry people see things different than ones with full bellies.
Stay tuned. This is gonna keep going, and going, and going, and going. Where it stops, nobody knows.
Keith, you're right about trust, but it is a foolish bargain to exchange freedom for security with the devil. Hungary, at least, has always been self-sufficient in terms of food. And great food it is, as well!
I heard similar comments living in Spain, even when they were flying high as the big growth economy in Europe. The older people always fondly remembered how "safe" things were under Franco and the Guardia Civil; you know, the friendly gaulighter on every corner..
I think it has been the main difference between the way most Euros and many Americans think. We Americans are now too in danger of forgetting the hard fought lessons of history and are settling for security as well.
For me, I prefer payback. I want to see bankers "giving back"(like the Kennedys...HA!)all those estates in the Hamptons, the Carribean and for the European bankers, Marbella. I think we need to be fighting the real enemy, those who have stolen from the world. Unfortunately, it's same old, same old; with no evidence of any litigation against those on Wall ST and in the City. In fact the same sorry people (Geithner and co.)are in charge of our govt. and money. ..."meet the new boss, same as the old boss". The bankers will be safe and the world will pay the price.
Europe has been on death row for quite a long time. With what's going on now, it could be taking its inexorable walk to the execution chamber.
It's really just a matter of time, and this calamity might just finish of the Euro Civilization once and for all. The Socialists, multiculturalists, Muslims, and feminists destroyed a perfectly good continent for the sole purpose of soothing their massive egos and visions of Utopia.
A lesson to be learned for America.
Just like Tomasz, I was born and raised in Poland, too. It was communist Poland, with foor rationing, electricity blackouts, bread lines, overhelming fear to simply speak up and endless hopelessness. Me and wife learned frugality and common sense in that kind of social environment. Oh, because of running one of major regional underground publishers back in 1983-87, I also experienced movie-like realities of communist prison. Then Polish authorities asked us to leave the country permanently with " one way passports". And since 1987 we have our own way of looking and evaluating American mentality. Being frugal and " common sense" is our second nature. Maybe that's why we still do not understand the American Great Depression v. 2.0. And our lives flow as they usually did for the last 20 + years. We paid cash for a nice brick ranch in Ohio, back in November 2007. It was a foreclosure. So we did experience American crisis - true. With no mortgage and no debt ( cars paid for, too) wife can afford working part time as a librarian and I can afford working from home as a free lance over the phone Polish/English interpreter. We are not millionaires, and have no intent to even get into that kind of headaches. But our life is simple, honest, ordered, and safe. We will fluently and slowly age, retire and die out. And we will never truly understand current "American victim mentality". Dark mindset of people, who can no longer dine daily at Red Lobster and excerscise their obsessive/compulsive disorder somewhere in Best Buys and Malls ....
As an American I lived in communist Poland in 1988 for a year, very fascinating, it was.
Went back in 2007 and lived there again for a year. Huge changes, but still a long way to go. If their economy collapses along with the others in EE, then all bets are off.
Poles are fighters, for sure, when things are bad, but not always so good when things are prosperous. They are a jealous bunch, that I can see.
Who knows how it will all go down, but they hate the Russians for what they did after WWII. Communism sucks and so does socialism, but it is all they know.
The next 5 years are going to be so interesting.
Bulgaria Saved Its Jews
The Unknown Rescue
Denmark is the country best known for rescuing almost their entire Jewish population. Since Bulgaria allied itself early with the Nazis in World War Two , their rescue of nearly 100% of their 50,000 member Jewish community is much less known. While average Bulgarians did their part, the
prime movers in the rescue included King Boris III, prelates of the Bulgarian Orthodox Church, and especially Dimitar Peshev.
http://www.associatedcontent.com/article/177164/bulgaria_saved_its_jews.html
Beyond Hitler's Grasp
A great many Jews know the story of how the Danes
rescued 8,000 Jews from the Nazi's by smuggling them
to Sweden in fishing boats.
Very few Jews, know the story of how all 50,000
Bulgarian Jews were saved. Not a single Bulgarian
Jew was deported to the death camps, due to the
heroism of many Bulgarians of every walk of life, up
to and including the King and the Patriarch of the
Bulgarian Orthodox Church.
In 1999, Abraham Foxman, the National Director of
the Anti Defamation League flew with a delegation to
Sophia to meet the Bulgarian Prime Minister. He gave
the Prime Minister the first Bulgarian language copy
of a remarkable book, "Beyond Hitler's Grasp,"
written in 1998, by Michael Bar Oar, a professor at
Emory University. (A Bulgarian Jew who had migrated
to Israel and then to the USA).
This book documents the rescue effort in detail. The
ADL paid for and shipped 30,000 copies to Bulgaria,
so that the population could partake in the joy of
learning about this heroic facet of their history.
This story is clearly the last great secret of the
Holocaust era. The story was buried by the Bulgarian
Communists, until their downfall in 1991. All
records were sealed, since they didn't wish to
glorify the King, or the Church, or the non
Communist parliamentarians, who at great personal
risk, stood up to the Germans. And the Bulgarian
Jewish Community, 45,000 of whom went to Israel after the War, were
busy building new lives, and somehow the story remained untold.
Bulgaria is a small country and at the outset of the
War they had 8 million people. They aligned
themselves with the Nazi's in hopes of recapturing
Macedonia from Yugoslavia and Thrace from Greece.
Both provinces were stripped from them, after W.W.I.
In late 1942 the Jews of Selonica were shipped north
through Bulgaria, on the way to the death camps, in
sealed box cars. The news of this inhumanity was a
hot topic of conversation. Then, at the beginning of
1943, the pro Nazi Bulgarian government was informed
that all 50,000 Bulgarian Jews would be deported in
March. The Jews had been made to wear yellow stars
and were highly visible.
As the date for the deportation got closer, the
agitation got greater. Forty-three ruling party
members of Parliament walked out in protest.
Newspapers denounced what was about to happen. In
addition, the Patriarch of the Bulgarian Orthodox
Church, Archbishop Krill, threatened to lie down on the railroad tracks.
Finally, King Boris III forbid the deportation.
Since Bulgaria was an ally of Germany, and the
Germans were stretched militarily, they had to
wrestle with the problem of how much pressure they
could afford to apply. They decided to pass.
Several points are noteworthy. The Bulgarian Jews
were relatively unreligious and did not stand apart
from the local populace by virtue of garb, or rites.
They were relatively poor by comparison to Jews in
other countries, and they lived in integrated
neighborhoods. Additionally, the Bulgarians had many
minorities, Armenians, Turks, Greeks, and Gypsies, in addition to Jews.
There was no concept of racism in that culture. The
bottom line here is that Bulgarians saw Bulgarian-Jews as Bulgarians, and not
as Jews.
And, being a small country, like Denmark, where there was
a closeness of community, that is often missing in
larger countries. So, here was a bright spot that we
can point to as example of what should have been.
The most famous of those saved was a young graduate
of the Bulgarian Military Academy. When he arrived
in Israel, he changed his name to Moshe Dayan.....
What a great story to pass on to your e-mail list....
Anonymous Go Israel! said...
Nature Remembers said...
"If you listen quietly you can still hear the terrible cries."
========================
NEVER FORGET!!!
February 27, 2009 8:06 PM
You and the other Jewish person who post all of the wonderful stuff about Israel sicken me. If Israel is do damn great then why do you live here in the U.S.A.? Why don't you just move to your shit country? And yes, ISRAEL WITHOUT AMERICAN AID WOULD BE JUST LIKE ANY OTHER SHIT COUNTRY.
Every year, Israel gets more money from America than any other nation in the world! Israel is also the largest recipient of military aid. Also, Israel receives a lot of money from Germany and scientific expertise from Germany so don't give me this bullshit about how your precious Jewish people turned a desert into a beautiful oasis of paradise!
Plus, don't give me the bullshit about how I must be an anti-Semite. I am a plain speaking American Jew (I am only a Jew culturally and not in a religious manner). The Jewish people are doing to the Palestinians what Europe did to the Jews.
Also, this post by an American Jew should let everyone else know that no, not all of us think the same on this issue and not all of us are religious zealots who believe that God gave us the land of Israel for our exclusive benefit.
Anonymous i've had it said...
Europe has been on death row for quite a long time. With what's going on now, it could be taking its inexorable walk to the execution chamber.
It's really just a matter of time, and this calamity might just finish of the Euro Civilization once and for all. The Socialists, multiculturalists, Muslims, and feminists destroyed a perfectly good continent for the sole purpose of soothing their massive egos and visions of Utopia.
A lesson to be learned for America.
February 27, 2009 10:28 PM
Sure, when things get bad, fall on the regular contingency plan; blame the minorities, women, feminists, poor people, socialists, etc...
Can't you come up with an original idea please? Also, how many Muslims, feminists, minorities, etc... sit on the upper management of the banks, GM, Ford, Chrysler, Countrywide Financial, Bank of America, etc... My advice to you, when things fall apart, don't blame the usual suspects (women, feminists, minorities, religious minorities, Muslims, Buddhists, etc...).
The girls from Estonia are so hot! Nice skinny blondies...Has anyone been there?
Thoughtful answer form my friend in Prague:
Generally, yes, they're right. Apparently there are a lot of Swiss Franc-denominated mortgages in Poland, and possibly in Hungary. But the Czechs and Slovaks are actually really resenting being lumped in with these countries, as are the Slovenians; they don't have these issues and their economies are doing relatively better.
But it's more complex than this guy's making it out. It's not like all 1.7 trillion is going to go into default all at the same time. That's the problem with people sitting in their big offices in Manhattan; they look at a region and put everyone in the same bucket.
For example, the economic slowdown will in many cases mean that more of the production will be shifted eastward from more-expensive Western factories.
And some sectors are showing signs of revival already. Kia and Hyundai, for example, have twin factories just across the Czech-Slovak border from each other. The implementation of government incentives to junk old cars in Western Europe means that people are buying cars again, so those workers went back to full shifts today.
The Slovaks and Slovenes both are on the Euro, too, which should help them especially with exports.
Ukraine is thoroughly fucked; a lot of the Western banks went in there expecting that the reforms that the Central Europeans had would take root there. But endemic corruption and a political deadlock have meant that little real change took place.
The Czechs and Croats have a large part of their economy based on tourism, but that will be a non-starter this year. But comparatively, even with a relatively high rate of mortgage lending in the past few years, overall indebtedness is still a fraction of what it is in Western Europe; it's still really hard to get a proper credit card, which was a pain in the ass before, but is turning out to be a blessing in disguise because it meant that people didn't go on the massive debt-fueled buying sprees they did in the US.
Will it be hard? Definitely. The shock waves are just starting to hit here.
Already it's interesting and scary to see a rise in xenophobic attacks throughout the region; people want easy scapegoats, and people who don't look like they do make easy targets.
Personally, though, I have a lot of hope for a couple of things: While there isn't an EU Federal Reserve to prop up bad banks, stimulus from the EU is on the way, albeit very slowly. Because it's so excruciatingly slow, the first wave of real EU funding, approved after enlargement in 2004, is just starting to hit the region, which means that there's a lot of infrastructure work being done. The second is that capital cities like Prague will probably be better off than the post-industrial regions, where there aren't as many opportunities. That could be bad, too, as lots more people move to the cities in search of jobs.
But will the entire region suddenly go dark? Unlikely. Like most other regions, I expect there will be brighter and darker spots, and that in general people will muddle through.
It may sound crass, but as opposed to most Americans, Eastern Europeans have had real and recent experience with poverty and probably have better coping mechanisms - everything from being able to fix broken stuff to being able to switch rapidly to barter-based economies if necessary.
Banks to avoid: Unicredit, Erste Bank, Raiffeisenbank, Societe Generale are the ones that come most quickly to mind; they have big exposure, especially in Romania and Ukraine. As it turns out, I have my pitiful bank account with Raiffeisenbank and my mortgage (in Czech crowns) is with Unicredit. But they're insured up to EUR 250,000 by the government, so it should be fine.
Will things hold out? Who knows? But it probably won't be as monolithic as that author said.
But our life is simple, honest, ordered, and safe. We will fluently and slowly age, retire and die out. And we will never truly understand current "American victim mentality". Dark mindset of people, who can no longer dine daily at Red Lobster and excerscise their obsessive/compulsive disorder somewhere in Best Buys and Malls ....
February 28, 2009 12:22 AM
Earlier in your post you describe what is most disgusting about Euros. You will live off the security Americans have provided for europe and you. You now live hear and trash America, an America who gave you everything while you gave America nothing. Look at your jobs. Socialist leeches chicken shits. You are typical eurotrash scum. You disgust me. Go back to Europe you scum. The third world war is coming. A coward like you does not belong hear hiding behind real men. You trash America I piss on you you ungratefull scumbag. You are Europe, it is a sad a weasel like you can hide behind real men. Grow old and die quietly Eurotrash worm.
Captain Conservative
I rate you with Bukko. You are not a man. You are a waste of skin.
Keefer,
You are a brave man. Move to Kiev this summer. Make sure to invest in a Kevlar wardrobe.
Report regularly back to us!
I can keep updating from Thailand. The Sheeple are still in denial here for now.
-Mike
All scum of the earth live in Eastern Europe....
Proof: The two World Wars and the breakup of Yugoslavia and the Cold war. Ok, Nazi Germany was responsible for WW2 but was not Polish soil the place where maximum atrocity was allowed to happen ?
Like clockwork.
Wonder if Putin will be able to hold it together?
I think he will. But it will be messy.
Russia's Putin warns against economic protests
NOVO-OGARYOVA, Russia, Feb 27 (Reuters) - Russian Prime Minister Vladimir Putin warned opposition critics on Friday not to use the economic crisis as an excuse to challenge his government and told them to abide by the law.
Unrest across Russia over economic upheaval has been muted, with the biggest protests so far taking place in the Far East port of Vladivostok where hundreds were arrested in January demonstrations over car tax.
Speaking at a meeting with leaders of Russia's dominant political party, United Russia, ahead of regional elections this weekend, Putin said that criticism of the Russian government during a crisis was allowed, but only within the laws.
"If opposition actions go outside the law, it means they are not pursuing the goals of improving people's lives, but their own selfish goals and the state has the right to defend itself properly," Putin said at his residence outside Moscow.
Grow old and die quietly Eurotrash worm.
Captain Conservative
February 28, 2009 7:41 AM
You clearly didn't get the guy's message. Judging from what he wrote, he gave America more fighting commies in Poland, than you do farting on America's good reputation as a sanctuary of the free world. Learn to read first ( and write "hear"). Shame on you.
Colonel Liberal
Looking through these posts and seeing how no one responded to my friends thoughtful answer, I realize what a bunch of ignorant ranting racist fools most of you are.
Keith you really need to puke up that Obama pill you took quick before it goes septic in your blood. Just a little medical advice.
eatern europe is the weakest link in the chain. they have numerous loans to them from western european cb's.
if they go, then europe goes. if europe goes, then we go. like a line of dominoes, they will all fall. all it takes is one ....
And don't try to back out of it Keith. We remember all of your Obamamania worshipping just a month back and your denunciation of Ron Paul.<<<
yep, keith wanted change. ladies and gentlemen, i present change. isn't it great?
All scum of the earth live in Eastern Europe....
Pah-lease!
Like Americans are saints right?
I think the 20 million Native Americans slaughtered a couple of hundered years ago by American settlers would disagree.
Or how about the half million Philipinos during the Spanish American war? Or the million Vietnamese during the Vietnam war? Or the ten million Iraquis between Gulf war 1 and 2. How about them nukes on Hiroshima and Nagasaki?
Shall I stop or shall we continue counting the dead?
All of eastern Europe in the past 2,000 years hasn't killed as many people as the US has in the past 200.
Guys, check out Howard Zinn's book (check out the video on that page)
http://www.amazon.com/Peoples-History-American-Empire-Project/dp/0805087443
Funny Daily Show interview:
http://www.thedailyshow.com/video/index.jhtml?videoId=117743&title=howard-zinn
Anonymous Moishe Yankel said...
Go Israel;
Bless you.
However, Europe must dedicate a viable independent Yiddish speaking land with clear and defined borders.
And return everything they stole from the Jewish people with interest.
Or Nature will do it for them.
Funny, I was talking to a Palestinian guy the other day who was saying the exact same thing about the jews......weird.
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