Well, I got a Grad. Degree in International Affairs/Economics, but I'm not working in the field...so judge this accordingly.
My analysis of the whole thing is that certain countries in the region (Thailand especially), are in a long term mess. Basically, if you need to go to the IMF for help, you are in for hard times. The govts. there have been buying the population's loyalty with lots of goods at uneconomic prices (i.e. way overvalued currency). This gave the speculators an easy run on their currencies, starting the whole bit we've seen. Japan and Korea are also in deep...way too much govt. intervention in the economy. Unfortunately for them, there are large constituencies who support these dumb economic policies, since they live on the rent taking.
The HK run, on the other hand, was just stupid. HK is pretty solid, and is backed by China, which may have problems but is just too big to be a target. Bejing can't afford to see HK go down due to numerous negative ramification it would have in its economic and foreign policies.
So, as far as whether to invest, short, etc...
Long term, Asia will get its act together, and by mid way through next decade will be a major force.
Short term (<1yr)industries in Thailand, Indonesia, etc...that are primarily import or domestically directed in output are dead. Export companies, however (any that send most of their output here), should see a major boom from increased exports (due to devaluation). Japan will stay about where it is. The economy need some stimulus to kick in, but if the govt. spends directly it will be cancelled by the fact it can't afford to. If they try avoiding long term reforms, and export their way out, we will get into a trade squable they will lose.
Pretty much ditto for Korea, with the addition of the whole N. Korea problem...until that is fixed or stabilizes nothing much is going to happen there. |
