From the comments section - Latvian bank deposits
Hi! I am from Latvia. What do you think, what happens to people deposits in EUR at worst scenario? We have legislation, that government guarantees about 10 000 EUR for deposits. Where will they get this money?
Thanks
I have no idea how Latvia plays out and no useful knowledge of Latvian politics. But in Argentina they just converted everything to pesos at the old exchange rate:
If Argentina is a model your guarantee will be in Lats in the end...
However it has worked differently in some crisis situations.
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One person (someone who thinks I am wrong) in the comments section points to a Hansa Bank executive pointing out that Estonia goes bankrupt if the Kroon devalues:
http://www.balticbusinessnews.com/Print.aspx?ArticleID=ba4449d7-bd41-4fe2-b7ba-bbf713312f8c
No. Estonia is bankrupt right now. The Kroon devaluing is just Estonia hitting the rock of reality.
And the Estonian CEO of Hansa is right. There is no pressure from Swedbank. Its head-in-the-sand stuff there.