Hyman Blumenstock hystock at
Sat May 2 00:36:16 PDT 1998

Dennis R Redmond wrote:
> On Fri, 1 May 1998, Doug Henwood wrote:
> > One reason may
> > be that Wall Street is more pissed at the IMF than ever - partly, I hear,
> > because most of the Asian debts are owed by private businesses rather than
> > the public sector (unlike Latin America in the 1980s) - meaning that they
> > don't have sovereign taxing power behind them. If the debtor units go under
> > because of engineered depression, then it's bye-bye loans - they won't be
> > able to hit up the education budget to get repaid.
> And we all know how tenacious, smart and strategically flexible Asian
> businesses can be, judging by the high quality of the computer peripherals
> and industrial goods they're exporting by the bucketful to the US. Though
> Indonesia and Thailand are clearly being nailed to the cross of the
> T-bill (a.k.a. rentier gold), I still think South Korea is going to
> ameliorate the worst of the austerity drive -- not so much because of any
> newfound tolerance on the part of US banks for their Asian competitors,
> but because US banks don't really have that much leverage over Asia. The
> April 1998 issue of "The Banker" had an interesting chart on page 59,
> which summed up the exposure of Japanese, European and US banks to the
> various Asian countries, reproduced below (all figures in billions US$):
> Country Total Japan France Germany UK EU USA
> China 57.9 18.7 7.3 7.3 6.9 28.1 2.9
> Hong Kong 22.3 87.4 12.8 32.2 30.1 99.5 8.8
> Indonesia 58.7 23.2 4.8 5.6 4.3 22.5 4.6
> Malaysia 28.8 10.5 2.9 5.7 2 12.7 2.4
> Philippines 14.1 2.1 1.7 2 1.1 6.8 2.8
> Singapore 211.2 65 15.4 38.4 25.2 113.3 5.2
> South Korea 103.4 23.7 10.1 10.8 6.1 36.3 10
> Taiwan 25.2 3 5.2 3 3.2 14.4 2.5
> Thailand 69.4 37.7 5.1 7.6 2.8 19.8 4
> source: Bank of International Settlements

Can we afford to waste time on the pure fairyland fantasy of either the Wicked Witch of the East, or the Wicked Witch of the West, or the chief Wicked Witch of all, the overall Banking System, when these are all pure fantasy, though manned by Real People, but having absolutely nothing to do with reality. The absolute reality is that a new born baby knows at birth all there is to know about REAL Economics. That all encompassing knowledge is the Reality that when one's stomach indicates less than fullness, then one must do something to alleviate that hunger. A fetish to this simple human requirment has been blown up to an 800 page atrocity, called "Economics the Science of Scarcity," of a subject that has no more elemental importance to reality than expresssing excess wind out of one's posterior. Man, having finally achieved that knowledge and how to alleviate it, can now graduate into a brand new Economic world, of immediate gratification of hunger, and then applying hiw new found time into pursuing, in concert with everyone else, new, astounding, and virtually unimaginable technical achievements.

Instead, we allow the Social Scientist, by forcing insufficient Funding, to maintain the ills of old as we are rapidly descending into the evil clearly described in <>.

> So Japan had 46% of the total exposure to Asia, but Europe as a whole had
> even more: 59.8% of the total! The US banks weighed in at a piddling 7.3%.
> Also interesting: the share of the German banks alone was 19.1%, bigger
> than the UK's share of 13.8%. Admittedly, the giant Brit banking firm
> HSBC, the Hong Kong and Shanghai Bank, though nominally headquartered in
> London, has its historical roots as a Hong Kong city bank: still, the
> Continental Europeans have moved into Asia bigtime, and are at least as
> important to the region as Japan. If Asia recovers, then the EU-Japan
> codominion will have passed its first major test: it will have flexed its
> muscles and shown that it can manage its neocolonies more efficiently
> than its American predescessor. Today Seoul, tomorrow Warsaw!
> -- Dennis

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