Bobby, from the article you linked:
>>Private foreign investors had followed their peers in jumping off the Asian markets without fundamental justification, he said. ''It was an unjustified race for the exit.''<<
I thought this comment was interesting. This is the way it's always worked, whether it's bonds, the Dow, or junior golds. A market doesn't feel the need to justify itself. As you have said, it's largely a matter of perception. As soon as one investor percieves that the others will run, self-preservation becomes the imperative. If you don't run, you are doomed to be the last one out. It's inevitable.
"But the focus shifted to food markets earlier in the day as crowds bought up rice, sugar, flour, cooking oil and milk."
biz.yahoo.com
"U.S. President Bill Clinton personally stepped into Asia's financial crisis on Friday, telling President Suharto in a 25-minute telephone call that Indonesia has to follow through on economic reforms.....
Mohammad Syahrial, head of research with Pentasena Securities, told Reuters only 22 of 282 companies listed on the Jakarta Stock Exchange were financially viable, with the rest technically bankrupt because of overseas debt commitments."
yahoo.com
I guess that I don't see any quick fixes here, either. Seems like the Heads of State are becoming increasingly alarmed about the possiblity of what Greenspan has called, "Atomic Erosion" in the international banking system. The BIS has repeatedly warned banks and businesses about the heightened danger due to the fact that curency risks were not being properly hedged. They said that we had come close to a systemic crises when Barings melted down. Can you imagine how this looks from the inside, now?
Tom |
