I asked my friend in Prague (he is an expat who has lived there for 20 years) how eastern europe looks. He does projects for Soros and travels all around eastern europe. He is responding to a blog post about the coming riots of the east due to mortgage crises and euro exploitation of the east.

Here it is:

Generally, yes, they're right. Apparently there are a lot of Swiss Franc-denominated mortgages in Poland, and possibly in Hungary. But the Czechs and Slovaks are actually really resenting being lumped in with these countries, as are the Slovenians; they don't have these issues and their economies are doing relatively better.

But it's more complex than this guy's making it out. It's not like all 1.7 trillion is going to go into default all at the same time. That's the problem with people sitting in their big offices in Manhattan; they look at a region and put everyone in the same bucket.

For example, the economic slowdown will in many cases mean that more of the production will be shifted eastward from more-expensive Western factories.

And some sectors are showing signs of revival already. Kia and Hyundai, for example, have twin factories just across the Czech-Slovak border from each other. The implementation of government incentives to junk old cars in Western Europe means that people are buying cars again, so those workers went back to full shifts today.

The Slovaks and Slovenes both are on the Euro, too, which should help them especially with exports.

Ukraine is thoroughly fucked; a lot of the Western banks went in there expecting that the reforms that the Central Europeans had would take root there. But endemic corruption and a political deadlock have meant that little real change took place.

The Czechs and Croats have a large part of their economy based on tourism, but that will be a non-starter this year. But comparatively, even with a relatively high rate of mortgage lending in the past few years, overall indebtedness is still a fraction of what it is in Western Europe; it's still really hard to get a proper credit card, which was a pain in the ass before, but is turning out to be a blessing in disguise because it meant that people didn't go on the massive debt-fueled buying sprees they did in the US.

Will it be hard? Definitely. The shock waves are just starting to hit here.

Already it's interesting and scary to see a rise in xenophobic attacks throughout the region; people want easy scapegoats, and people who don't look like they do make easy targets.

Personally, though, I have a lot of hope for a couple of things: While there isn't an EU Federal Reserve to prop up bad banks, stimulus from the EU is on the way, albeit very slowly. Because it's so excruciatingly slow, the first wave of real EU funding, approved after enlargement in 2004, is just starting to hit the region, which means that there's a lot of infrastructure work being done. The second is that capital cities like Prague will probably be better off than the post-industrial regions, where there aren't as many opportunities. That could be bad, too, as lots more people move to the cities in search of jobs.

But will the entire region suddenly go dark? Unlikely. Like most other regions, I expect there will be brighter and darker spots, and that in general people will muddle through.

It may sound crass, but as opposed to most Americans, Eastern Europeans have had real and recent experience with poverty and probably have better coping mechanisms - everything from being able to fix broken stuff to being able to switch rapidly to barter-based economies if necessary.

Banks to avoid: Unicredit, Erste Bank, Raiffeisenbank, Societe Generale are the ones that come most quickly to mind; they have big exposure, especially in Romania and Ukraine. As it turns out, I have my pitiful bank account with Raiffeisenbank and my mortgage (in Czech crowns) is with Unicredit. But they're insured up to EUR 250,000 by the government, so it should be fine.

Will things hold out? Who knows? But it probably won't be as monolithic as that author said.