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As Goes Latvia, So Goes...?

The answer is, hopefully, "not much," given Latvia's recently failed auction of Treasury bills that signal a national currency crisis. But "not much"  is a lot to hope for.

Together with fellow Baltic states, Estonia and Lithuania, Latvia lies at the "cockpit" of (north) eastern Europe, between larger countries such as Sweden, Poland and Russia. In this regard, it is similar to the Benelux countries, which lie at the "cockpit" of (north) western Europe.

During the 17th century, Britain regarded the Baltic region has second in importance only to the North Sea/western Atlantic region serving the countries of western Europe. The Baltic has since declined in importance, because Sweden, Poland and Russia all have, but is still by no means unimportant.

Moreover, Latvia is on the "cutting edge" of the "new" (Eastern) Europe. Besides Lithuania, Latvia lies north of (a shrunken) Poland, and Balkan states such as Hungary, Romania, and Bulgaria. All of these countries went through a boom-bust cycle in the economy and real estate, just like Latvia. As such, their fates differ only in degree, not in nature, from Latvia's. 

Latvia is a "small" country. But it is a poster child for a lot of other "small" countries in eastern Europe. Collectively, however, they're not so small. So as goes Latvia, so goes...quite a lot.