Hey Chizzy...what a wonderful world it is with currency manipulators in control.
"Ukraine's interest rate is among the world's highest: annual rates of 30 percent on loans made in the national currency are common.
In a bid for cheaper credit, during the early 2000s many borrowers, like the Baranskys, signed contracts committing them to receive and pay back their bank mortgages in dollars or Swiss francs.
These arrangements supplied loans at percentages ranging from one third to one half of the national currency average. But they exposed borrowers to the risks of exchange rate fluctuations, and in the case of Maria and Oleg Baransky the timing was unlucky.
Pummelled first by the world financial crisis then by political instability, the value of Ukraine's currency, the hryvnia, declined from a rate of five to the US dollar in the year the Baranskys took out the loan to 25 to the dollar today. So, in 2007, the Baranskys' $120,000 mortgage was worth 600,000 hryvnia, but with the changing rates, their debt has ballooned up to more than 2 million hryvnia today, despite monthly payments in excess of $1,300 over more than seven years.
The Baranskys' story is not atypical. Following a directive from the Central Bank, Ukraine's banks stopped issuing foreign currency loans in 2009. Still, according to the Independent Association of the Banks of Ukraine [NABU], an industry lobby group, there are 54,000 foreign currency loans outstanding in the country for a combined value of $2.4bn."
$2.4B...in a country of Ukraine's size.
Wait for it...there is a kicker:
"On the macro level, until October 2008, the Ukrainian government intervened economically to maintain the exchange value of the hryvnia at a fixed rate, creating a sense of security, explained Molchanova.
After this was discontinued during the financial meltdown in late 2008, many a Ukrainian small business wilted under the twin pressures of declining sales and escalating debt service costs in hryvnias.
The question of who is to blame and what to do about the debt debacle has stirred controversy. Last December, under pressure from the banking sector, President Poroshenko vetoed a bill passed by Ukraine's parliament that would have converted loans like Sharikova and Baranska's back into hryvnias at a pre-crisis exchange rate.
No legislation aimed at making debts more manageable has succeeded since then in navigating its way through parliament to be signed into law."
http://www.aljazeera.com/indepth/featur ... 39814.html
Ukraine is totally corrupt...and we, of course, are supporting a bunch of thugs in office while pointing fingers at the Russians.
Business as usual.
