1 / 0

The Asian Crisis: a Perspective After Ten Years

The Asian Crisis: a Perspective After Ten Years. W. Max Corden Presented by Trace Hayles. The Asian Crisis: Prelude. 1997: Thailand, Indonesia, Malaysia, and Korea in the midst of an investment boom Comprised of local savings and FDI Result of favorable macroeconomic policies

marli
Télécharger la présentation

The Asian Crisis: a Perspective After Ten Years

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. The Asian Crisis: a Perspective After Ten Years

    W. Max Corden Presented by Trace Hayles
  2. The Asian Crisis: Prelude 1997: Thailand, Indonesia, Malaysia, and Korea in the midst of an investment boom Comprised of local savings and FDI Result of favorable macroeconomic policies 3 Forms of capital inflow that fueled boom FDI Inflow of portfolio capital into local stock markets Short term borrowing by local banks
  3. The Bubble Bursts Catalyst: Eventual slowdown of export growth in Thailand (20% to 0% year over year) 1997: Exchange Rate crisis for baht This triggered crises in the other three Asian Tigers (contagion) Free movement of capital policies – not in place in China and India
  4. GDP Growth
  5. Currency Crisis Outside of Malaysia, other three countries held large amounts of $-denominated short term debt With no hedging, this led to sharp depreciation Domestic banks exposed to both currency risk and credit risk
  6. Unique Crises Thailand: FBAR Indonesia: Suharto Korea: faster recovery from larger IMF infusions Malaysia: Capital outflow restrictions
  7. Policy Response Domestic Interest Rates Bank Rescues Keynesian Expansion
  8. Conclusion Key factor: run-up in investment, “hard landing” after Recession was not inevitable, but events in Thailand accelerated region-wide crisis
More Related