No, Henke's misleading you. For Henke to write in an 11/97 Forbes article that there is a tremendous difference between the HK and Argentine pegs to what Mexico had is ridiculous. For him to use a
failed old attack as a reasoning that the HK and Arg pegs are too mighty is totally bogus- what kind of leverage did the speculators have back then compared to now? Not anything near it. The big hedge funds here - Tiger, Global, Quantum and others can smash the HK peg very easily. Why do you think that the HKMA is finally starting to bitch about the attacks? They've burned over 20% of foreign reserves recently defending this so-called mighty currency that you claim doesn't need defending. What are professional investment managers and other veteran speculators shorting HK for then, huh? Are you saying that they're throwing their $ out the window??!!
Anyway, the article doesn't clarify what you mean by the $HK being fixed & not pegged. To myself and every fncl. journalist out there, (from what I've read) it seems like a peg. I don't see where Henke differentiates. The definition of a peg is that the currency is a fixed rate of exchange that is overseen by the gov.
That's the case in HK and ARG. The peg has got to be fixed to something - the $US, the EURO, whatever. By you using the term "fixed" I don't see any difference than in the word "peg".
Also, to say that the HKMA doesn't make any monetary policy is silly,
because their recent actions contradict the premise of his article.
Stop reading Forbes and start reading AFR.
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