Proving the recession is truly global, banks in Mongolia are threatening to foreclose on herders’ goats, sheep, and camels, the Wall Street Journal reports. Mongolians call it a financial “zud,” a local term for unusually devastating winters. Falling cashmere prices stemming from the West’s recession—the high-end textile market shed 33% in a year—have hit Mongolia’s herding households particularly hard.
Mongolia, with 2.6 million people and a quarter of households tied to herding, gambled on stable high prices for cashmere, with many borrowing excessively to purchase goods like solar panels and motorbikes. As in the West, banks didn’t manage risks well. New lending has dried up and the forced selling of herds has cut animal prices in half.