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

To: RealMuLan who wrote (2141)	2/14/1998 9:36:00 AM
From: Worswick	Respond to of 9980

Goodness couldn't have said it better. Or, as Mrs. Bridge said, "My stars!" "....if there has to be a single scapegoat for the crisis, it is easy money. In 1986, Washington got Tokyo to loosen up on monetary policy in a bid to boost imports. The tsunami of yen created Japan's late-1980s "bubble economy." When it burst, Tokyo still kept funds dirt-cheap to prop up its banks. That set up East Asia for its own intoxicating fix of credit explosion and asset inflation. Add to that the local largess for speculators and the well-connected. That flood of money diluted prudence, bloated waste, damped thrift, watered unproductive investments, and made it simple to hose down the consequences of misrule, cronyism and graft -- until the cash dried up. In Asia's debacle, poor government and bad connections played key roles. But easy money was the root of all evil." Further to this my friend Joe pointed me to the "official China thread" at chinaeco.com which, somewhere, stated that in China existing equity in Chinese companies equals 50% of the debt. Can't find the story. The idea, however, is sobering and plays to the Asian deflation scenario. Best to you all on a morning that is 5 degrees outside here.