Lessons of the lat

摘要

Latvia is a financial minnow, Its economy-about the size of North Dakota's-accounts for little more than 0.1% of the output of the European Union. But the repercussions of its currency troubles will reverberate in other countries in eastern Europe,rnand should act as a wake-up call for Europe's policymakers. The bursting of the credit bubble hit Latvia harder than almost any other country. Years of boom, buoyed by cheap foreign-currency loans and a currency pegged to the euro, have turned to a spectacular bust. Over the past year Latvia's economy has shrunk by almost a fifth and its jobless rate has risen to 17.4%.