Europe faces death by decadence Respecting voters is now seen as a sign of weakness
"The past week of Swedish politics has been a mysterious case of a dog that should have barked, but then simply didn’t. In a barely covered press release, the Riksbanken — Sweden’s central bank — announced that it had lost some 44 billion kr (£3.2 billion), and needed that much money from the state in order to return to the minimal level of capitalisation stipulated by the law. For a small country such as Sweden, this is a very large sum: it represents fully half of what the state spent on defence during the 2023 fiscal year.
The reasons for this new hole in the budget aren’t particularly unique: like every other country in the West, Sweden got too used to zero-interest policies being the new normal, and only belatedly caught up with the new reality brought about by post-Covid interest hikes. The central bank thus engaged in a game of buying high and selling low: loading up on bonds at a point where interest rates were low, and then offloading them when the rates shot up and the economy began taking a turn for the worse."
Intressanta iakttagelser av Malcolm Kyeyune.
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