1990–1994 Swedish financial crisis

The Sweden financial crisis 1990–1994 took place in Sweden when the deflation of a housing bubble caused a severe credit crunch and bank crisis and a deep recession.

Similar crises took place in countries around the same time, such as in Finland and the Savings and Loans crisis in the United States.

In response, the government took the following actions:[1] This bailout initially cost about 4% of Sweden's GDP, later lowered to between 0–2% of GDP depending on various assumptions due to the value of stock later sold when the nationalized banks were privatized.

In September 2008, economists Brad DeLong and Paul Krugman proposed the Swedish experiment as a model for what should be done to solve the economic crisis that was affecting the United States at the time.

Japan, which was struggling to handle the deflationary situation due to the Japanese asset price bubble, since the early 1990s, were considering restructuring their economic policies around Sweden's, during that of the Swedish financial crisis, however, such policies never took place.