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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: tom who wrote (2126)	2/13/1998 12:37:00 PM
From: Derrick P.	Read Replies (2) \| Respond to of 9980

Tom, I read in the WSJ that a Japanese bank was proposing a $15 billion loan to Indonesia provided by the G7. Enough to make current loan payments for at least a year. Please note this was proposed not approved. I have also heard that the IMF and Robert Rubin do not approve of the Indo. currency board. I feel that there is some light at the end of the tunnel but I sure don't see it. Maybe around the next turn? BTW, the buying continues of EWM. I've seen over $3.5 million go by at the ask in a few minutes. That wasn't one of you guys was it? Regards, Derrick

To: tom who wrote (2126)	2/14/1998 11:44:00 AM
From: Mohan Marette	Read Replies (3) \| Respond to of 9980

Currency Board in Indonesia? To put it crudely the idea is BULL SHIT. Tom, The idea of a Currency Board in Indonesia floated by Suharto is rather a worthless one, at this point in time.To think Indonesia can implement this system with 20 billion dollars in Current Account surplus and some borrowed money is absurd. Depending on where Indonesia wants to peg its currency Rupiah,they need to have at least 100% or better of the anchor currency for this system to be successful in the conventional sense,which they do not have. If they attempt to do this with 50% or less and with borrowed money at that,it will be a disaster and will most likely plunge the country into further chaos,both civil and economic. It works in Hong Kong because they have the 'anchor' currency to support this system,meaning HK$ is fully covered by the US$ (HK's anchor currency),if not 100% but very close. Then again Suharto is not stupid, perhaps this is a clever plan specifically designed to get his and his family's fortune out of the country before it is too late and before he goes down into the annals of history as a bad dream.I say this because I don't think this is a well thought out plan at all. No wonder Bob Rubin and Camdessus are dead against this plan. Disclaimer: The above diatribe is based on my limited knowledge of the 'Currency Board' system and I do not make any claim as to its accuracy.