Thanks to Jonathan for this Wall Street Journal article.  It gives an excellent view of how the economic crisis looks in our little corner of the world. “Mongolian nomads’ troubles show that the ravages of the economic crisis have spread to even the most remote parts of the world. More than a quarter of the households in Mongolia — which has a population of about 2.6 million — earn a living raising animals… …In recent years, commercial banks started competing to extend credit to herders, who typically earn significant cash just twice a year — in the spring through cashmere and wool sales, and in the autumn through sales of animal skins and meat. The money helped families get through the times in between, usually at a cost of between 2% and 3% in interest per month. Troubles began when demand for cashmere started falling after the U.S. slipped into recession in late 2007. By last June, the price for cashmere in Mongolia had fallen by more than 33% from a year earlier, hitting about 28,000 togrog, or $19, a kilogram. Prices have dropped further. “Everyone says now that we are just taking care of banks’ animals,” says Janchiv Nyambuv, a 65-year-old herder who borrowed 500,000 togrogs, or $350, that he must repay in May… …Mr. Sodnomdarjaa says he and his wife are determined to repay the loan and plan to look for construction or mining work. These days, the couple cares for other families’ camels. Their only regular compensation is the right to milk the herd. About half the milk, they drink. The other half they sell. Two months’ earnings are about enough to buy a sack of flour. “The kids want to eat meat, but we have nothing to give them,” says Mr. Sodnomdarjaa.”

Thanks to Jonathan for this Wall Street Journal article.  It gives an excellent view of how the economic crisis looks in our little corner of the world.

“Mongolian nomads’ troubles show that the ravages of the economic crisis have spread to even the most remote parts of the world. More than a quarter of the households in Mongolia — which has a population of about 2.6 million — earn a living raising animals…

…In recent years, commercial banks started competing to extend credit to herders, who typically earn significant cash just twice a year — in the spring through cashmere and wool sales, and in the autumn through sales of animal skins and meat. The money helped families get through the times in between, usually at a cost of between 2% and 3% in interest per month.

Troubles began when demand for cashmere started falling after the U.S. slipped into recession in late 2007. By last June, the price for cashmere in Mongolia had fallen by more than 33% from a year earlier, hitting about 28,000 togrog, or $19, a kilogram. Prices have dropped further. “Everyone says now that we are just taking care of banks’ animals,” says Janchiv Nyambuv, a 65-year-old herder who borrowed 500,000 togrogs, or $350, that he must repay in May…

…Mr. Sodnomdarjaa says he and his wife are determined to repay the loan and plan to look for construction or mining work. These days, the couple cares for other families’ camels. Their only regular compensation is the right to milk the herd. About half the milk, they drink. The other half they sell. Two months’ earnings are about enough to buy a sack of flour.

“The kids want to eat meat, but we have nothing to give them,” says Mr. Sodnomdarjaa.”

  1. nickbogardus reblogged this from jrenich and added:
    Thanks to Jonathan for this Wall Street Journal article. It gives an excellent view of how the economic crisis looks in...
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