The Asian Financial Crisis – A Policy Perspective

1. INTRODUCTION

THE ASIAN'FINANCIAL CRISIS A POLICY PERSPECTIVE

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Vol.28 No 1, MlU'ch 1998 115Economic Analysis & Policy

J.D. StanfordDepa rtment ofEconomics

. The University of QueenslandQld 4072

It is clear that the Asian financial crisis, which occupied much of the financial andeconomic news in the second half of 1997, is not yet resolved. Although theInternational Monetary Fund has provided assistance to four countries - Thailand,the Philippines, South Korea and Indonesia - it is premature to predict the finaloutcome of the crisis. The contagion from these economies has been containedand other Asian economies, except Malaysia, have emerged from the first impactrelatively unscathed,

The purpose of this paper is to give an account of the major events of theAsian financial crisis and to provide an assessment of the position at the end ofMarch 1998. In doing so comparisons are made with previous financial crises indeveloped economies and these are used as a benchmark for indicating the timeit may take for the Asian financial crisis to be resolved. The InternationalMonetary Fund programs for the four countries which sought external aid arediscussed.

It appears that the Philippines is relatively unaffected by the crisis whileKorea and Thailand are making progress with measures to correct the underlyingproblems although both will experience negative growth in 1998. However theproblems of adjustment in Indonesia are substantial and there is no readilyapparent solution to the capital flight and general lack of confidence expressedby financial markets. The interesting matter to observe is whether the measuresthat Malaysia voluntarily implements, in seeking to deal with the crisis from itsown resources, are similar to those carried out by other economies with assistancefrom the IMF.

Because events have unfolded quickly it has been difficult to keep up to datewith traditional and convention research sources. Fortunately the Internet and theWorld Wide Web have risen to the occasion and there are many sites whichprovide highly useful information on a timely basis. These sites are listed anddiscussed briefly in the section a Note of Sources.

2. AN HISTORICAL PERSPECTIVE ON THE ASIANFINANCIAL CRISIS

It is worthwhile putting the current crisis in some perspective. Financial crises werecommon in England and the USA in the nineteenth and early twentieth centuries.A comprehensive history is provided by Kindleberger (1978). The following tableis cnmpiled from Capie and Wnnd (1986) to give an idea of the incidence offinancial crises:

The Depression in the 1930s was the greatest financial crisis of all, andfollowed the stock market crash nf 1929. Banks in the USA failed on a large scale:Bemake (1983) states that "because of failures and mergers the number of banksoperating at the end nf 1933 was only just above half ofthe number that existed in1929. Banks that survived made heavy losses." Further details ofthe US experienceare·given in Chandler (1970), Friedman and Schwartz (1963) and Kindleberger(1973). The Great Depression was not confined to banking failure; Pollard (1987)showed that US GDP fell by nearly 30 per cent in four years.

Australia experienced severe financial crises in the 1890s when most banksfailed and real economic activity took nearly a decade to recover to pre-Depressionlevels (Boehm, 1971) and in the 1930s when an overseas debt crisis forced seriouseconomic adjustment and economic activity declined by over 30 per cent from peakto trough, although the banking crisis of 1893 had induced banks to behave muchmore conservatively during the intervening period (Schedvin, 1970). In morerecent times, Australia has experienced episodes of financial instability arisingfrom cycles in property prices and construction, in which financial institutions havefailed. Sykes (1988) gives a general and informative account of the whole period.Major difficulties of this type occurred in the early 1960s, the late 19705 and early

Vol.28 No.1, March 1998

BritainGermanyFrance, BritainBritainGermany, AustriaUnited States of AmericaFranceFranceBritainUnited States of AmericaFrance, Italy, United States of AmericaUS stock market crash

World wide depression

Country affected by crisis

TABLE I

FINANCIAL CRISES -1857-1933

Date of crisis

1857t85718641866187318731882188918901893190719291932-3

116 Economic Analysis & Policy

3, THE GENERAL OUTLINE OF THE ASIAN FINANCIAL CRISIS

TABLE 2

CHANGE IN EXCHANGE RATE AND STOCK MARKET INDEXES,ASIAN ECONOMIES, JULY·NOVEMBER 1997 (%)

1990s. Stanford and Beale (1987) analyse the 1970s experience and Sykes (1994)provides an account of the 1990s. In this latter period, two State Banks -in Victoriaand South Australia- failed causing serious difficulty to the economies ofthese twoStates; difficulties, moreover, which have not yet been fully resolved. In the StockMarket Crash of 1987, the market indicator, the AIlOrds index, dropped more than50 per cent and did not recover to pre-crash levels for well over five years.

These considerations indicate that, in general, one should not be undulysurprised by occurrence offinancial crises because they are part of the developmentof capitalist societies. A study of past crises provides us with some kind ofbenchmark to assess the time required for their resolution.

-23-21

-14-26-12

-37-34-56-45-52

Change in srockmarket index

VoL28 No.1, March 1998 117

------~--------------~----

oo

-10-11

·15·50-26-38-31-61

Change inexchange rate

Economic Analysis & Policy

ChinaHong Kong, SARJapanSingaporeTaiwanIndonesiaKoreaMalaysiaPhilippinesThailand

Country

It is possible to distinguish a number of features of the current crisis which allowfurther analysis. The following features give a general overview of the course ofevents:• sharp falls in asset prices;

a failure of the central banks to defend their currency;a capital flight;

• a loss of confidence in domestic banks and other financial institutions;• a debt crisis, Le. an inability to meet debt servicing obligations;

downgrading of credit ratings.The falls in asset prices which occurred during 1997 in respect to Asian

economies are reported in Table 2. It is easy to see from the arrangement ofeconomies in this table that, while all the economies considered experienced someturbulence in the period July-November 1997, there was no widespread contagion.

Source: National data; sLock exchanges

In Thailand there is sustained criticism of the responses of the Bank of Thailand duringthe float with an offiCial inquiry established in 1998. There are widespread calls for theresignation of top officials of the Bank.

Bangkok Post Economic Review, End 1997, available at: www.bkkpost.samart.co.th!newslBparchive/ecoreview97/review9705.htm

Hedge funds are mutual investment funds which take speculative posilions withderivative products.

An account from the Thai pomt of view is given in the Bangkok Post's Banking andFinance YearEnd 1997, review available at www.bkkpost.samart.co.th/newslBparchive/ecoreview97/review9705.htm

Well-managed economies with robust institutions rode out the slonn. There maybe some induced deflationary effects for other Asian economies but these are likelyto be relatively small. It should be noted that both China and Hong Kong SARexperienced no change in the exchange rate as they have sufficient foreignexchange res~rves to withstand substantial pressure in foreign exchange markets.However, the five economies in difficulties - Indonesia, Korea, Malaysia, thePhilippines and Thailand - were not so well placed. Indonesia, Korea and Thailand,in particular, had extensive short term foreign debts: Indonesia's debt wasconcentrated in the hands of the non-bank private sector while in Korea the banksowned the equivalent of USD 60 billion repayable within 12 months (Bank forInternational Settlements, 1997). Thailand experienced a classic secondary bankingcrisis with nearly all ofits 58 finance companies insolvent. In early December 1997,56 finance companies were closed by the Financial Restructuring Authority.!

The foreign exchange crisis began with a speculative attack on the baht by whathave been identified as hedge funds' caused by adverse economic news in May 1997and fears of an interest rate rise in the Japanese market. Hedge funds were reportedto have committed USD 10 billion taking short positions in spot, forward and optionsmarkets against the baht. J The bank ofThailand responded with substantial interventionin the spot market and increased capital controls. In July the Bank ofThailand movedto a managed float whereupon the baht fell 15 per cent against the US dollar and inAugust the Bank allowed the baht to float because the foreign exchanges reserves, ifnot exhausted, were down to perilously low levels (some foreign exchanges reservesare required to back the domestic money supply). Short-term interest rates wereincreased (up to 12.5 per cent a year) but this shifted pressure to domestic financialinstitutions and the stock market. In August, Thailand's total foreign debt was USD89 billion with some USD 71 billion due for repayment at December 1997. Totalforeign reserves including those committed to supporting the money supply werejustunder USD 26 billion.4 Under these circumstances the Thai government turned to theInternational Monetary Fund for support.

In August the Indonesian government allowed the rupiah to float and attemptedto support the currency. However, this impacted severely on the domestic economy:as one fund manager quoted in The Financial Times on 13 January 1988 said

Vo1.28 No.1, March 1998118 Economic Analysis & Policy

TABLE 3

GDP AND CURRENT ACCOUNT DEFICIT, FIVE ASIANECONOMIES, 1996

Country GDPin USD Current Account1996 DeficitlGDP %

Indonesia 223 ·3.5Korea 485 ·3.9Malaysia 98 -4.5Philippines 84 -4.6Thailand 185 -5,4

"Propping up interest rates just .killed economic activity." In Korea the financialdifficulties ofthe conglomerates, the chaebol, particularly Hanbo Steel and the carmaker Kia, focussed attention of the bad debts problem of the banks leading to adowngrade in Korea's sovereign credit rating. As the won dropped below the 1000to the dollar mark the central bank was unable to support the rate despite raisingshort-tenn interest rates to over 20 per cent. Korea sought assistance from theInternational Monetary Fund on 21 November 1997. Unofficial estimates, asreported in various issues of the Korean Herald,' of Korea's foreign debt due to berepaid in December 1997, ranged up to USD 100 billion.

All five economies had current account deficits in 1996 as reported in Table 3which also indicates the GDP of these econonties. Only Korea had a larger GDPthan Australia. As a result of the currency crisis the USD value ofGDP will shrinkdramatically.

Vol.28 No.1, MMCh 1998 119Economic Analysis & Policy

Table 4 is an assessment of the extent of the effect of the crisis on the fiveeconomies made at the beginning of March 1998; it is necessarily subjective.However, as the Philippines has borrowed a relatively small proportion of its quotafrom the IMP and the overall effect is light compared with the other four and likelyto heresolved in a few years. Malaysia has comparatively lower foreign borrowingsand appears to be determined to resolve the problem without external assistance.Thailand has a severe banking crisis and large scale restructuring of the financialsector is required. In terms of an Australian comparison, the Thai problem isperhaps not as serious although comparable to the 1890s financial crisis inAustralia. As ntigh! be expected in a democracy, the government in Thailandchanged as a result of the crisis. Australian experience is relevant here: nogovernment, State or Commonwealth, in office at the outbreak of the 1930sDepression, whatever its political persuasion, held office at the next election. BothState governments in Victoria and South Australia in office at the time of the failureof the State banks suffered huntiliating losses at the next election.

The Korean Herald is available at www.koreaherald.co.kr

Korea has a severe banking crisis and debt problem analogous to the Australianexperience of the 1890. Korea has a new government which has been adamant inimplementing corrective action and reforms. The Korean people have respondedpatriotically by donating gold to the government and embracing an austerityprogram which has a substantial element of oppositioo to foreign goods. (Pressreports from Korea state that owners of foreign motor vehicles experience refusalof service at petrol stations and even abuse from other Koreans.) Financial marketsin 1998 have tentatively re-rated Thailand and Korea accepting that these economiesare on the path to recovery. Unfonunately, the opposite has to be said of Indonesiawhich has a lack of credibility on all fronts

The position in Indonesia reponedly has been affected by a number of factors,such as: corruption; crony capitalism; and lack of transparency in governmentaccounting. The United States Department of Slate reponed "Indonesia has avigorous and rapidly growing economy. The benefits of economic development arewidely dispersed, but pervasive corruption remains a problem." 6 TransparencyInternational, a coalition against corruption in international business transactions,defines corruption as "the misuse of public power for private benefits, e.g. thebribing of public officials, taking kickbacks in public procurement or embezzlingpublic funds. "Its I 996"Rank Country Score gave Indonesia a score of 2.65 on a 10point scale with 10 being the least corrupt. (For comparison, Australia had a scoreof8.60.)' The Heritage Foundation states that "Indonesia's regulatory environmentis characterised by bribery, kickbacks, and corruption. Many regulations areapplied arbitrarily, and bribes may be necessary to receive an 'exemption' from agovemmentregulation...8 Corruption appears to be relatively more entrenched thanin most other Asian countries.9 The assessment by financialrparkets is that genuinereform is unlikely and such reforms as are carried out will benefit this group andleave structural problems unchanged. Current government accounting practices donot reveal the full extent of the govemmentis contingent liabilities in respect ofguarantees of bank deposits; other incidents reveal the transfer of funds fromgovernment project to the activities of cronies. For example. funds in the nationalforest program which should have been avai lable to remedy the bush fires havebeen transferred to the National Car Project.

The general lack of credibility about the policy in Indonesia is shown in thedebate over the currency regime. The Indonesian government is toying with theidea of a currency board under which the value oflhe rupiah would be set at a rateof 5500 io the USD rather than the current market rate of 10,000. If the currency


9

Vol.28 No.I, March 1998

US Department of State, Indonesia repon on Human Rights Practices for 1996, releasedby .the Bureau of Democracy, Human Rights, and Labour, January 30, 1997, atwww.usis.usemb.selhumanlindonesia.htm

www.Transparency.deJpress/1997.31.7.faqcpi.html

www.heritage.org.heritage/

Lingle (1997) provides a discussion of relative incidences of corruption.

TABLE 4

ASSESSMENT OF THE SEVERITY AND MANAGEABILITY OF THECRISIS ON FIVE ECONOMIES

board proposal were regarded as credible the market rate would converge to theproposed rate before the establishment of the currency board. A similar proposalsuggested by Australian economists for a dual currency rate system which wouldrequire the separation of current and capital account transactions in the foreignexchange market and the simultaneous. existence of two exchange rates is notcredible because the market doubts that the official capacity or will to separate thetwo types of transaction exists. Indonesia's problems are made worse by theprogress made by both Korea and Thailand in.their reforms which are viewed bymarkets as being on the right track and credible. It is not at all clear how theproblems in Indonesia will be resolved because political factors are more significantthan economic policy making.

The above assessment is reflected in the credit ratings by Moody's Investorservices at the beginning of 1998. To interpret the ratings it should be noted that thecritical demarcation in the rankings of ratings is Baal; above this rating isinvestment grade while below this rating is indicative of high risk. Many investors,particularly pension funds and other managed funds, are prohibited by their trustdeeds from holding securities with a credit rating below investment grade. Followingcriticism of the ratings services for their failure to adjust ratings in advance of thecrisis, it would be expected that ratings services will be taking a closer look at theirprocedures and decisions to provide more timely evaluations. Nevertheless, theratings shown below, which are roughly comparable to the other major ratings,indicate that Indonesia, Korea, the Philippines and Thailand are below investmentgrade and while this is maintained are nOl likely to receive further inflows ofportfolio capital.

Manageable

Vol.28 No.1, March 1998 121

Perhaps unmanageable

Manageable with IMF assistance

Manageable withoutIMF assistance

Readily manageable with IMFassistance

Manageable with IMF assistance

Extremely severe

Very severe

Severe

Relatively mild

Severe

Effect of crisis on local economyEconomy

Thailand

Indonesia

Korea

Malaysia

Philippines


4. CHRONOLOGY OF THE CRISISContrary to some views, the Asian financial crisis did not develop out of blue sky;there were signs of difficulty in the real sector, property markets and financialsectors before July 1997. However, once the crisis began events moved quickly and

5, REASONS FOR THE CRISIS

Note: * indicates under review for possible down grading.Source: MoodY's Investors Service.

Table 6 presents a selective view of major events on the period January 1997 toJanuary 1998 for four of the economies.

TABLES

SOVEREIGN CREDIT RATINGS ASIAN ECONOMIES,JANUARY 1998

Vo1.28 No I, March 1998

The Asian financial crisis came as a shock to the many commentators who hadpreviously expressed unqualified admiration for the Asian economic miracle(World Bank,1993), and whose fIrst response to the crisis was denial. It had becomeclear that Krugman's criticism of the Asia miracle as being solely derived frominput growth was valid; however, by itself, this factor was not enough to explain thesudden downturn in 1997 (Krugmann, 1998 a & b). Real sector explanations of thecrisis are to be found in the underproductive investment in mature industries (steel,motor vehicles in Korea), property speculation in Thailand and extravagantshowpiece investments (the world's tallest building, new international airport,world's longest city in Malaysia), and national car project in Indonesia. Furtherdetails are to be found in the International Monetary Fund Country Programs andRadlet and Sachs (1988a and b).

Coupled with this were:Poor credit allocation decisions and monitoring activities by banks~

Government intervention in credit allocation process;• General lack of transparency in the financial sector

Banks overreliance on short-term foreign debt often unhedged (e.g. in Korea andThailand)

• Corruption in government; and• Crony capitalism.

Economy Bonds and notes Bank deposIts

Long term Short tenn Long tenn Short lerm

China A3 P-2 Baa P-3Hong Kong A3 P-l* A3 P-l*Indonesia B2 NP Caal NP

Japan Aaa pol Aaa P-lKorea Bal'" NP Caal NPMalaysia A2 P-2 Baal P-2Philippines Bal NP Ba2 NP

Singapore Aal pol Aal pol

Taiwan Aa3 pol Aa3 pol

Thailand Bal NP Bl NP


TABLE 6

SELECTED MAJOR EVENTS IN ASIAN FINANCIAL CRISIS, 1997-98

Month 1997-98 Indonesia

Jan-June

July

Korea

Conglomerate ("chaebol")fail

Carmaker Kia asksfor bailout

Malaysia

Monetary authorityrestricts loans toproperty and shares

Defence of ringgit abandoned;IMF assistance sought

Thailand

Companies do not meetpayments on foreign deb!;Finance companies report baddebts due to property downturn.

Baht floated,depreciates substantially

~,~n

1;..~.Pi>;r0"~

Source: Press reports; IMF Press Releases

August

September

October

November

December

January

Feb~ary

Rupiah allowedto Ooal

Rupiah depreciatessubstantially

IMF rescuepackage agreed

16 banks closed

Sovereign credit ratingdowngraded to junkbond status

Rupiah collapses andreaches low point of17,000 lo USD; IMFpackage to be renegoliated."Love therupiah" campaignlaunched.

Conflict betweengovernment and IMF

Banks' credit ratingsdowngraded

Kia nationalised; sovereigncredit rating downgraded

Won depreciates substantially;IMF approached for assistance

IMF provides very large packageof assistance. Government replaced;Kim Dae-jung elected president.International banks roll-over loansto Korea

International banks refuse tohonour letters of credit of someKorean banks; benchmark interestrate margin soars to fourpercentage poinls. Korean banksreport worst ever profit resultswith total loss of over USD3 billion

Government intervention torestrict leading on Stock Exchange

Government expenditure onmajor projects postponed

Prime Minister Mahalhir launchesverbal atlack on financial markets

Government package lo assistbrokerage houses in trouble

Government announces planto cut spending by ] 8%

Slock market falls drasticallyin one week. Campaign"Love Malaysia Buy MalaysiaProduclS"launched.

IMF rescue agreed

Finance Minister resigns

Prime Minister resigns toallow for change of government

56 of 58 finance companiespennanently closed

Bank report reduced profilS;bank restructuring

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6. PROSPECTS FOR ASIAN ECONOMIES

It is clear that the Asian financial crisis will slow down real growth rates; HongKong SAR. China, Taiwan. Singapore should have positive but reduced growthrates in the next year. For the other economies in the region, there will be no growthand some economies will experience recession. The estimates for the other sixeconomies are set out in Table 6 below. Official comments from the Bank of Japanspeak of flat economic activity but this may be overly optimistic. The estimates ofIndonesian growth are little better than guesses but the real fear is that the economycould get out of control. The optimistic estimates for Korea and Thailand arederived from their Letters of Intent to the IMF while the official position fromMalaysia is that growth prediction have been downgraded without a quantitativeestimate provided.

The outcome was bad debts in the financial sector and a financial bubble. Asfinancial markets became concerned about the state of Asian economies exchangerates came under pressure and despite initial attempts of central banks to defendcurrencies by inteIV'ention in foreign exchange markets and raising interest rates,exchanges rates fell. As interest rates were increased, stock market prices cameunder serious downward pressure and the bubble burst. As more infonnation aboutthe state of financial institutions in these economies was revealed, the financialmarkets re-rated the economies and sold currencies and shares down even more.International credit rating agencies downgraded the ratings ofbanks and sovereignratings. The responses of national economies to these problems were to attempt tosupport markets and then seek external assistance. The thrust of IMF support wasto:• Liberalise financial markets and the capital account of balance of payments• Move to increase transparency in government

Move prudential supeIV'ision of financial institutions towards internationalstandards.

-2%-20%+

-5%0-2%3-4%-5%

Less optimisticestimate

Vo1.28 No.1, March 1998

Optimisticestimate

Projected Growth 1998 (% change in GDP)

zero-10%-3%

No greater than 4%4-5%-3%

TABLE 6

ESTIMATES OF GROWTH - SIX ASIAN ECONOMIES

JapanIndonesiaKoreaMalaysia

PhilippinesThailand

Economy

Source: Official estimates; private sector estimates


7. INTERNATIONAL MONETARY FUND PROGRAMS

9. CONCLUDING COMMENTS

Policy towards Asia has been dominated by the belief held to be self-evident thatgrowth in the Asian economies is assured and never-ending. That belief is notconsistent with the facts. It is true that the Asian economies have an enormouseconomic potential but translating this potential into actual economic performanceis not certain. Other economies in the past have had economic potential but failedto live up to this promise; an example is Argentine last century. While the Asianeconomies are potentially profitable export markets, there remain considerable

8;- LOOKING FURTHER AHEAD

It ·would appear that the Asian financial crisis is of a sizeable dimension and isunlikely to be eliminated in under five years. One benchmark for this evaluation isthe Swedish experience where a large scale collapse of the banking sector took asimilar period to resolve. McCauley and White (1997) cite estimates by Caprio andKlingebiel (1996) that the direct cost to government of resolving banking crises inSweden was six per cent of GDP.

The financial restructuring in progress in Korea and Thailand will take a similarperiod with the end objective being compliance with international banking standardsfor bank capital and supervision. (Again, one might note that the reform of theAustralian financial sector has been underway for 15 years and is far fromcompletion.) During the period of adjustment, interest rates in these economies willremain high relative to international levels and the availability of bank loans tobusiness will be curtailed.

Vo1.28 No.1, Much 1998 125Economic Analysis & Policy

'fhe International Monetary Fund Programs for support of the four economies havesome clear aims which are discussed in detail in Radlet and Sachs (1988a and b).The major thrust of the In1ernational Monetary Fund Programs is to ensure that theoverseas debt is repaid in full, that restructuring of the financial sectors of theeconomies is undertaken and that rigidities in the economy due to restrictions oninternational competitiveness and domestic monopolies are removed. While theInternational Monetary Fund is criticised for imposing harsh conditions and forbailing out the foreign banks, the intervention of the International Monetary Fundhas some clear advantages. In the absence of International Monetary Fund action,there is no fonnal mechanism for the indebted economies to negotiate debt rescheduling; the Latin American experience in the 19805 showed that the processcould be long and unsatisfactory. The International Monetary Fund allows theclient economy the opportunity to continue in international trade as the onlyeffective sanction banks had against defaulting sovereign nations is to deny themaccess to finance for trade through the letter of credit system. While this is apowerful sanction for banks, it does nothing to ensure banks are repaid. InternationalMonetary Fund intervention will be expected to reduce transactions costs inrenegotiating and re-scheduling debt and, of course, the banks hope to be able toshift some of the costs on to the International Monetary Fund.

barriers to entry for foreigners in merchandise trade and even more rigid barriersin the services sector.

This analysis would caution a more sceptical approach to an "Asian first"policy. The US market remains the driving force of the world economy and theenlarged European market with a common currency is potentially a substantialmarket with little foreign exchange risk.

The Asian financial crisis is a symptom of immature and unsustainable growthby some of the Asian economies where expansion in export oriented industries hasnot been matched by evolution of institutions which are necessary to supportsustained expansion. The next five years are critical to see if the transition to maturecapitalist economies can be made.

Note on Information Sources

All the official agencies have sites on the World Wide Web:• International Monetary Fund: www.imf.org• Bank. for International Settlements: www.bis.org• World Bank: www.worldbank.org

Other useful official Asian sites include:• Korea Stock Exchange: www.kse.or.la• Stock Exchange of Thailand: www.set.or.th

Ministry of Finance, Thailand: www.mof.go.thCentral Bank of Thailand: www.bot.or.th

A number ofprominent economists, in particular Paul Krugman and Jeffrey Sachs,have sites on the World Wide Web where their writings on the Asian financial crisisand other matters can be found:• Paul Krugman: www.-econ.stanford.eduleconlfacultylkrugman.html

Jeffrey Sachs: www.hiid.harvard.edu/people/sachs/dirbios.htmlGeorge Soros, the "speculator" who was criticised for his role in the crisis, has ahome page at www.soros.org, and his credo "Towards a Global Open Economy"The Atlantic Monthly, January 1998 can be found at www.theatlantic.comlissues/98janlopensoc.htm

Major newspapers and business magazines have rearlily accessible sites althoughsome have restricted access and generally require registration. Of the unofficialsites, D Ed Yardeni's Economic network at www.yardenLcom has a sectiondedicated to the Asian crisis and useful data and graphs.

The Asia Chronology of the Asian Crisis and its Global Contagion atwww.stern.nyu,edu/-nroubini/AsainChronology1988.htm is exhaustive in itscoverage; the coverage is so exhaustive that it is a matter of wonder why someoneis so dedicated to providing a wealth of information to all and sundry.

The Asian crisis home page at http://weber.u.washington.edul-karyiulAsiaiindex.htm is useful and the South China Morning Post provides an Asian crisiscoverage at www.scmp.com/news/speciaVAsianCrisis/index.asp

126 Economic Analysis & Policy Vol.28 No.1, March 1998

Bank for International Settlements (1997), International Banking and FinancialMarket Developments, Basle, Bank for International Settlements (August).

Boehm, E. A. (1971 ), Prosperity and Depression inAustralia, 1887-1987, Oxford,Oxford University Press.

Capie, F. and G.E. Wood (eds) (1986), Financial Crises and the World BankingSystem, London, Macmillan.

Caprio, G. and D. Klingebiel (1996), "Bank insolvency: bad luck, bad policy, orbad banking?" Paper presenled to the Annual World Bank conference ondevelopment economics, Washington DC, April.

Chandler, L. (I 970),America 's Greatest Depression, New York, Harper and Row.

Eatwell, J., M. Milgate and P. Newman (eds) (1987), The New Palgrave DictionaryofEconomics, London, Macmillan.

Friedman, M. and A. Schwartz (1963), A Monetary History of the United States,1867-1960, Princeton, Princeton University Press.

Juttner, D. J. and T. Valentine (eds) (1987), The Economics and Management ofFinancial Institutions, Melbourne, Longman Cheshire.

Kindleberger, c.P. (1987), Manias, Panics, and Crashes -A History ofFinancialCrises, New York, Basic Books.

Kindleberger, c.P. (1973), The World in Depression 1929-1939, London, Allenand Lane.

Krugman, P. (1998a), "What Happened to Asia?", Paul Krugman Home Page.

Krugman, P. (1998b), "Asia: What Went Wrong?", to be found atwww.pathfinder.com.fonuneI1998/9980302Jfst8.htm

Lingle, Christopher (1997), The Rise and Decline of the Asian Century, EditionsSirocco, Barcelona.

McCauley, R.N. and W.R. White (1997), "The Euro and European FinancialMarkets", Basle, Bank for International Settlements.

Pollard, S. (1987), "financial crises", in Eatwell et 01. (1987).

Radlit, S. and J. Sachs (I 998a), "The Onset of the East Asian Financial Crisis",presented at the National Bureau of Economic Research (NBER) CurrencyCrisis Conference, February. An updated version (30 March 1998) i5 availableat www.hiid.harvard.edu/pub/other/asiacrisis.html

Radlit, S. and J. Sachs (l998b), "The East Asian Financial Crisis: Diagnosis,Remedies, Prospects", presented to Brookings Panel, Washington, DC, March.An updated version (20 April 1998) is available at www.hiid.harvard.edulpub/other/asiacrisis.html


REFERENCES

Vo1.28 No.1, March 1998 127

Schedvin, C.B. (1970), Australia and the Great Depression, Sydney, SydneyUniversity Press.

Stanford, J.D. (1997), The Asian Financial Crisis and the Rural Sector, Address tothe United Graziers Association (South East Queensland Division),Toowoomba, December.

Stanford, J. D. and T.G. Beale (1987), "Financial Instability - An Episode" inJuttner and Valentine (1987).

Sykes, T. (1994), The Bold Riders - Behind Australia's Corporate Collapses,Sydney, Allen and Unwin.

Sykes, T. (1988), Two Centuries of Panic: a history of corporate collapse inAustralia, Sydney, Allen and Unwin.

US Department of State, Indonesia report on Human Rights Practices for 1996,released by the Bureau ofDemocracy, Human Rights, and Labour, January 30,1997, at www.usis.usemb.selhumanlindonesia.htm

World Bank (1993), The East Asian Miracle - Economic Growth and PublicPolicy, Oxford, Oxford University Press.

128 Economic Analysis & Policy Vo1.28 No.1, MaTCh 1998

Documents

The Asian Financial Crisis – A Policy Perspective