This possibly explains the recent popularity of the Nordic Noir genre of novels, films and TV series. The Girl with the Dragon Tattoo written by the late Swedish journalist Stieg Larsson was one of the first and a worldwide hit. The mix of very big business (think Ikea, Nobel and Wallenberg), royalty and landed gentry, plus blue-collar workers - a bit like Britain, really.
What also caught my (financial) eye was how weak the Swedish krona has been over the past two years or so. Against the euro it has been pushing up against 9.6000, its weakest since 1999 (bar 2009's financial crisis). Triangle consolidation since December 2014, plus September's close above its upper edge, suggest the krona is liable to renewed attack. A sudden devaluation to 10.4000 should be considered. Odd, as we're told Swedish banks are well run and profitable. Or are property prices and mortgages the problem?
The Norwegian economy is very different, with prosperity coming later in the form of North Sea oil and gas. Wisely putting much of the proceeds into a sovereign wealth fund, the model has recently been adopted by countries in Asia and the Middle East. But wholesale crude prices are well below 2008's record high, and are currently trading at less than half 2014's interim peak. With Saudi Arabia pumping like mad to try to plug its gaping budget deficit, Norway withdrew cash from its fund ($5.4bn in H1 2016) for the first time since it was established in 1996.
You'd think the currency would weaken on this but, ironically, it has strengthened against both the US dollar and its Swedish counterpart (see chart below) over this calendar year. Admittedly, from very weak levels, and interestingly a rally not mirrored by the Canadian dollar (another 'commodity' currency). This week it's testing secular trend line resistance at 1.0800 Swedish per Nokkie krone. A break above here targets 1.1300, maybe even 1.2000.
The Danish krone is pegged at 7.46038 to the euro (give or take 2.25 per cent) and to keep it here Danmarks Nationalbank has kept its key interest rate at zero or negative since 2012 (with a record low of -0.75 per cent last year). This has inflated asset prices - most notably housing, where Denmark was one of the first to securitise mortgages. It is also reflected in a soaring OMX Copenhagen index of the 20 most active stocks. Maersk, Carlsberg, Pandora and Vestas are names you will probably be familiar with. Struggling at 1000 this year and, unless we see further rate cuts, it could be top-heavy.
Helsinki's OMX All-Share index is a very different beast, trading in line with many weaker European bourses and with company names that are difficult for us to pronounce. It suffered badly due to the high-tech bubble and Nokia's fall when fickle fashion moved on.
