Pernicious practice

Will they ever learn how dangerous it is to borrow in foreign currency? To judge from the turmoil in Eastern Europe, the answer is no. Time and again, individuals, speculators and governments have engaged in foreign currency borrowing binges. The attraction is obvious. A Hungarian homeowner can borrow much more cheaply in Swiss francs than in forints. Similarly, in the run up to the Asian financial crisis a decade ago, Thai companies could get better rates in dollars than in bhat. Cheap borrow...