Sweden: Prosperousness or Precipice

Renault, VW, Mercedes Benz, Volvo, BMW, Audi, Porsche, Ferrari, Maserati

Triumph, Suzuki, Honda, Harley Davidson, BMW, Ducati...Swedes do have a fine taste in cars and bikes.

And the homes- each of them deserves a picture postcard.

The first few days, I thought Swedes were filthy rich; not just because of the kind of houses they live in and the kind of cars they drive but the quality of their life and the consumption patterns are evidently not cheap nor mediocre even- everything was affluent, almost lavish. However, as I dug a little beneath the surface, I was told that behind this opulence was the deathly D-word: Debt. Apparently, Swedes have this compulsive obsession with things bigger and better- bigger houses, better smartphones, and faster cars and they take up huge debts to get these.

With average direct taxation rates as high as 48-50% and a lot more in the form of Value added taxes and social fee, the average Swede pays the world’s highest rate of tax and of course, taxes constitute the largest household expense. And there is little incentive to save for a rainy day- not because people are sure it wouldn't rain- but because the social security is very high and the risk people are exposed to is almost non-existent. This makes it sensible to spend your savings but borrowing makes things so much more multi-dimensional.

Things are good now. They’ll be fine in the near future. But one wrong decision here, one unwise policy there, thus comes an economic crisis and it wouldn't take long for the ground to fall beneath the feet. After all, global warming is a much slower threat than greed.