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Old 14.10.2008, 09:43
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Re: How Safe is UBS

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... Does it look like many people could lose their homes in Iceland (like what is happening in the US)?
The Icelanders could face galloping inflation. The ISK currency had devalued substantially. Hence all imported products and services -- guess Iceland imports a lot -- would become very expensive. But wages probably would not rise.

This combination is known as "stagflation" and means tough times ahead. The US is less vulnerable because it is a larger economy that is less dependent on imports.
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