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Albania in 1997 was a wake-up for me:

Many citizens naive to the workings of a market economy put their entire savings into pyramid schemes. In a short while, $2 billion (80% of the country's GDP) had been moved into the hands of just a few pyramid scheme owners, causing severe economic troubles and civic unrest. Police stations and military bases were looted of millions of Kalashnikovs and other weapons. Anarchy prevailed,[4] and militia and even less-organized armed citizens controlled many cities.

Thus described by wikipedia.

I remember reading an in-depth article at the time. According to it (and my memory) it was not a strict pyramid scheme, but rather a bubble turned Ponzi. The bubble started from political changes in the area, that is the wars in what was soon to be former Yugoslavia and the sanctions put in place.

Albanian groups started to smuggle sanctioned stuff and made lots of money. Their was room for expansion and more and more people invested and got rich. The Dayton agreement of 1995 removed the foundation for the investment scheme but by then the speed was great enough that it could carry on until 1997 on pure momentum. But the day came when all savings had been sucked up and then the ineviteble collapse.

This was refered to as a pyramid scheme by western media and that got me thinking about the raising stocks at the time (1997) when everyone was becoming an investor and especially in technological stocks. So I figured that that must be a bubble too and predicted a crash in 1998. Apparently I underestimated how big bubbles can be.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Thu Mar 22nd, 2007 at 11:15:32 AM EST
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