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The worst chapter began with the 1919 Trianon treaty and the latest, but definitely not the last, in the book of Slovak-Hungarian relations was written on 1 November in Dunajska Streda, at a football game between DAC, the team of ethnic Hungarian city Dunaszerdahely and Slovan Bratislava. Local policemen stormed Hungarian nationals, who were at the game to support the home team and to protest the burning of a Hungarian flag at an earlier game.

Hungary's vulnerability is not exceptional, either within the region or in comparison with other emerging markets. We can easily find an example of a country at greater risk, despite having a developed market, in Denmark.

 “Hungary is in the middle of the storm”, and “the Anglo-Saxon financial model will disappear” were just two of the opinions voiced at a conference in Budapest last Wednesday, where the global economic upheaval was on the agenda. Across town, as if any further proof were needed that Hungary is well and truly reaping the whirlwind, the National Bank of Hungary was announcing a base rate hike from 8.5% to 11.5% in a bid to protect the vulnerable forint from speculative attacks.

In less than 48 hours after the National Bank of Hungary (MNB) left the base interest rate unchanged at 8.5%, the Monetary Council found itself back around the table last Wednesday at an extraordinary session, hiking the rate by 300 base points to 11.5% in a bid to defend the floundering forint and attract investors T-bill auctions, after several cancellations due to lack of interest.

A high level crisis summit was held in Budapest last Saturday to discuss the threat to Hungary from international financial chaos.

Four people were killed and another three, one of them a young German girl, were in critical condition after a train crash 30km southeast of Budapest last Monday. Signal failure was initially blamed for the disaster, which prompted the resignation of the chairman of the board of state railway company MÁV and the transport minister.

The most recent wave of the ongoing global financial crisis has hit Hungary along with the whole of Europe. Gábor Békés, research fellow at the Institute of Economics of the Hungarian Academy of Sciences (MTA) and former analyst at Lehman Brothers (2001-03), says in his summary of the impacts while looking down the uncertain road ahead.

Many people regard Hungary’s past as closed and are unwilling to talk about it. Historian Krisztián Ungváry, by contrast, stands accused of slander in two court cases because he openly criticised the political past of two public figures. “As a historian it is not my duty just to bury myself in books. Instead I have to take a public stance and use my knowledge in the fight for democratic values,” Ungváry said. The determination with which he answers reflects the fact that he has already withstood many public battles.

I grew up surrounded by animals. In the ’50s in the village we kept rabbits, chickens, pigs, sheep, geese and ducks, which were allowed to move around relatively freely in our yard and garden. I was only at war with the geese: barely a day went by without bruises and cuts, and on many occasions my father had to rescue me from the attackers with purposeful steps. Some of the miscreants were sentenced to a premature death in the oven.

István Kocsis, who became CEO of Budapest Transport Company (BKV) at the start of September, is optimistic about its future. He contends that BKV is not loss-making because it operates badly, and believes that predictable conditions, rather than greater state support, represent the solution to the problems of the company which treats Budapesters to 1.3 billion journeys each year.

Keith C. Smith of Center for Strategic & International Studies believes corruption, and not dependence, is the threat to Western Europe from Russian energy trade. He criticised the EU for what he sees as its pusillanimous reluctance to stand up to Russia.

It has almost become a cliché that the current political gridlock in Hungary may be resolved in three different ways: the dissolution of parliament and early elections; setting up a new “caretaker” or expert government; or securing a majority for the Socialists’ programme. In reality, there are more possible scenarios than that – especially from an economic point of view – because what happens and when is of vital importance.

Russia was isolated but defiant at the end of last week as the diplomatic storm raged over its military intervention in Georgia and its recognition last Tuesday of the independence of the breakaway regions of Abkhazia and South Ossetia.

The government has finally ended months of speculation by revealing its ideas on tax reform. Prime Minister Ferenc Gyurcsány released last Wednesday a plan in which he envisaged cuts of HUF 1.2 trillion (EUR 5.05 billion) over four years. The streamlining would begin next year with cuts totalling HUF 300 billion (EUR 1.26 billion) – the best indication yet of what the 2009 budget could contain.

A former equities broker at the Hungarian K & H bank was sentenced to eight years in prison by a Budapest court last Thursday after being found guilty of massive embezzlement and misuse of over HUF 20 billion (EUR 84.57 billion) of investors’ money.