This is leverage at work… but in reverse… great on the way up but it will bite you in the ass on the way down. Excerpt: ” Stephen Jen, currency chief at Morgan Stanley, said Eastern Europe has borrowed $1.7 trillion abroad, much on short-term maturities. It must repay – or roll over – $400bn this year, equal to a third of the region’s GDP” And this in essence is the problem. At a time when the sovereign debt of Germany has been downgraded, what hope do Hungary, Ukraine or Latvia have to get any financing?

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/4623525/Failure-to-save-East-Europe-will-lead-to-worldwide-meltdown.html

Forbes on Ukraine

http://www.forbes.com/2009/02/13/ukraine-default-outlook-markets-economy-0213_europe_27.html

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