Debtors and Creditors

[Chris Burford]

At 12:54 09/04/99 -0400, you wrote:
>Henry C.K. Liu wrote:
>
>>Asian solution will come from creating Asian institutions to supplant
>>the unresponsive global institutions within which Asian economies are
>>increasingly put at a competitive disadvantage. Grass root resistance to
>>American demands for trade liberalization will force Asian leaders to
>>seek Asian regional solutions, perhaps a yen based currency regime with
>>an Asian Monetary Fund.
>
>I've been reading stuff lately, mostly in the FT, suggesting that the Asian
>crisis countries have been showing signs of economic recovery and, not
>coincidentally, disobeying the IMF. Malaysia, of course, was the star
>rebel, but the FT reported the other day that Thailand has pretty much torn
>up the IMF agreement and has loosened monetary & fiscal policy
>substantially. South Korea has been less overtly rebellious, but it too
>hasn't been following the letter of the Fund's law. Anyone know any more?
>
>Doug

Hong Kong still has not been punished itself for its temerity in
intervening in the market to punish the currency raiders.

I keep an article from Fortune of 23 Nov 98, by Jim Rohwer on "Hong Kong's
Folly" predicting "it is only a matter of time before this policy backfires."

"The trouble with the government's earlier stock market interventions ...
is that they strongly suggest the government does not have the political
will to let Hong Kong's pegged exchange rate system work as it was designed
to. ... It is bad enough that foreign investors doubt the government's
spine. It is far worse that local bank depositors have doubts too: Over the
past year they have been putting more and more of their savings into US
dollars."

To be honest I have not been following very closely recently but I notice
the Hang Seng is now over 11000.

Perhaps others know some of the reasons behind this.

Chris Burford

London