[edit]Philippines
Further information: Economy of the Philippines
The Philippine central bank raised interest rates by 1.75 percentage points in May 1997 and again by 2 points on 19 June. Thailand triggered the crisis on 2 July and on 3 July, the Philippine Central Bank was forced to intervene heavily to defend the peso, raising the overnight rate from 15% to 32% right upon the onset of the Asian crisis in mid-July 1997. The peso fell significantly, from 26 pesos per dollar at the start of the crisis, to 38 pesos as of mid-1999, and to 54 pesos as of first half August 2001.
The Philippine economy recovered from a contraction of 0.6% in GDP during the worst part of the crisis to GDP growth of some 3% by 2001, despite scandals of the administration of Joseph Estrada in 2001, most notably the "jueteng" scandal, causing the PSE Composite Index, the main index of the Philippine Stock Exchange, to fall to some 1000 points from a high of some 3000 points in 1997. The peso fell even further, trading at levels of about 55 pesos to the US dollar. Later that year, Estrada was on the verge of impeachment but his allies in the senate voted against the proceedings to continue further. This led to popular protests culminating in the "EDSA II Revolution", which finally forced his resignation and elevated Gloria Macapagal-Arroyo to the presidency. Arroyo managed to lessen the crisis in the country, which led to the recovery of the Philippine peso to about 50 pesos by the year's end and traded at around 41 pesos to a dollar by end 2007. The stock market also reached an all time high in 2007 and the economy is growing by at least more than 7 percent, its highest in nearly 2 decades.
[edit]Hong Kong
Further information: Economy of Hong Kong
Although the two events were unrelated, the collapse of the Thai baht on 2 July 1997, came only 24 hours after the United Kingdom handed over sovereignty of Hong Kong to the People's Republic of China. In October 1997, the Hong Kong dollar, which had been pegged at 7.8 to the U.S. dollar since 1983, came under speculative pressure because Hong Kong's inflation rate had been significantly higher than the U.S.'s for years. Monetary authorities spent more than US$1 billion to defend the local currency. Since Hong Kong had more than US$80 billion in foreign reserves, which is equivalent to 700% of its M1 money supply and 45% of its M3 money supply, the Hong Kong Monetary Authority (effectively the city's central bank) managed to maintain the peg.
Stock markets became more and more volatile; between 20 October and 23 October the Hang Seng Index dropped 23%. The Hong Kong Monetary Authority then promised to protect the currency. On 15 August 1998, it raised overnight interest rates from 8% to 23%, and at one point to 500%. The HKMA had recognized that speculators were taking advantage of the city's unique currency-board system, in which overnight rates automatically increase in proportion to large net sales of the local currency. The rate hike, however, increased downward pressure on the stock market, allowing speculators to profit by short selling shares. The HKMA started buying component shares of the Hang Seng Index in mid-August.
The HKMA and Donald Tsang, then the Financial Secretary, declared war on speculators. The Government ended up buying approximately HK$120 billion (US$15 billion) worth of shares in various companies,[23] and became the largest shareholder of some of those companies (e.g. the government owned 10% of HSBC) at the end of August, when hostilities ended with the closing of the August Hang Seng Index futures contract. The Government started selling those shares in 2001, making a profit of about HK$30 billion (US$4 billion).
[edit]Malaysia
Further information: Economy of Malaysia
Before the crisis, Malaysia had a large current account deficit of 5% of its GDP. At the time, Malaysia was a popular investment destination, and this was reflected in KLSE activity which was regularly the most active stock exchange in the world (with turnover exceeding even markets with far higher capitalization like the NYSE). Expectations at the time were that the growth rate would continue, propelling Malaysia todeveloped status by 2020, a government policy articulated in Wawasan 2020. At the start of 1997, the KLSE Composite index was above 1,200, the ringgit was trading above 2.50 to the dollar, and the overnight rate was below 7%.
In July 1997, within days of the Thai baht devaluation, the Malaysian ringgit was "attacked" by speculators. The overnight rate jumped from under 8% to over 40%. This led to rating downgrades and a general sell off on the stock and currency markets. By end of 1997, ratings had fallen many notches from investment grade to junk, the KLSE had lost more than 50% from above 1,200 to under 600, and the ringgit had lost 50% of its value, falling from above 2.50 to under 4.10 to the dollar. The then premier, Mahathir Mohammad imposed strict capital controls and introduced a 3.80 peg against the US dollar
In 1998, the output of the real economy declined plunging the country into its first recession for many years. The construction sector contracted 23.5%, manufacturing shrunk 9% and the agriculture sector 5.9%. Overall, the country's gross domestic product plunged 6.2% in 1998. During that year, the ringgit plunged below 4.7 and the KLSE fell below 270 points. In September that year, various defensive measures were announced to overcome the crisis. The principal measure taken were to move the ringgit from a free float to a fixed exchange rate regime. Bank Negara fixed the ringgit at 3.8 to the dollar. Capital controls were imposed while aid offered from the IMF was refused. Various task force agencies were formed. The Corporate Debt Restructuring Committee dealt with corporate loans. Danaharta discounted and bought bad loans from banks to facilitate orderly asset realization. Danamodal recapitalized banks.
Growth then settled at a slower but more sustainable pace. The massive current account deficit became a fairly substantial surplus. Banks were better capitalized and NPLs were realised in an orderly way. Small banks were bought out by strong ones. A large number of PLCs were unable to regulate their financial affairs and were delisted. Compared to the 1997 current account, by 2005, Malaysia was estimated to have a US$14.06 billion surplus.[24] Asset values however, have not returned to their pre-crisis highs. In 2005 the last of the crisis measures were removed as the ringgit was taken off the fixed exchange system. But unlike the pre-crisis days, it did not appear to be a free float, but a managed float, like the Singapore dollar.
[edit]Singapore
Further information: Economy of Singapore
As the financial crisis spread the economy of Singapore dipped into a short recession. The short duration and milder effect on its economy was credited to the active management by the government. For example, the Monetary Authority of Singapore allowed for a gradual 20% depreciation of the Singapore dollar to cushion and guide the economy to a soft landing. The timing of government programs such as the Interim Upgrading Program and other construction related projects were brought forward. Instead of allowing the labor markets to work, the National Wage Council pre-emptively agreed to Central Provident Fund cuts to lower labor costs, with limited impact on disposable income and local demand. Unlike in Hong Kong, no attempt was made to directly intervene in the capital markets and the Straits Times Index was allowed to drop 60%. In less than a year, the Singaporean economy fully recovered and continued on its growth trajectory.[25]
[edit]China
Further information: Economy of the People's Republic of China
The Chinese currency, the renminbi (RMB), had been pegged to the US dollar at a ratio of 8.3 RMB to the dollar, in 1994. Having largely kept itself above the fray throughout 1997–1998 there was heavy speculation in the Western press that China would soon be forced to devalue its currency to protect the competitiveness of its exports vis-a-vis those of the ASEAN nations, whose exports became cheaper relative to China's. However, the RMB's non-convertibility protected its value from currency speculators, and the decision was made to maintain the peg of the currency, thereby improving the country's standing within Asia. The currency peg was partly scrapped in July 2005 rising 2.3% against the dollar, reflecting pressure from the United States.
Unlike investments of many of the Southeast Asian nations, almost all of China's foreign investment took the form of factories on the ground rather than securities, which insulated the country from rapid capital flight. While China was unaffected by the crisis compared to Southeast Asia and South Korea, GDP growth slowed sharply in 1998 and 1999, calling attention to structural problems within its economy. In particular, the Asian financial crisis convinced the Chinese government of the need to resolve the issues of its enormous financial weaknesses, such as having too many non-performing loans within its banking system, and relying heavily on trade with the United States.
[edit]United States and Japan
Further information: Economy of the United States and Economy of Japan
The "Asian flu" had also put pressure on the United States and Japan. Their markets did not collapse, but they were severely hit. On 27 October 1997, the Dow Jones industrial plunged 554 points or 7.2%, amid ongoing worries about the Asian economies. The New York Stock Exchange briefly suspended trading. The crisis led to a drop in consumer and spending confidence (see 27 October 1997 mini-crash). Japan was affected because its economy is prominent in the region. Asian countries usually run a trade deficit with Japan because the latter's economy was more than twice the size of the rest of Asia together; about 40% of Japan's exports go to Asia. The Japanese yen fell to 147 as mass selling began, but Japan was the world's largest holder of currency reserves at the time, so it was easily defended, and quickly bounced back. GDP real growth rate slowed dramatically in 1997, from 5% to 1.6% and even sank into recession in 1998, due to intense competition from cheapened rivals. The Asian financial crisis also led to more bankruptcies in Japan. In addition, with South Korea's devalued currency, and China's steady gains, many companies complained outright that they could not compete.[26]
Another longer-term result was the changing relationship between the U.S. and Japan, with the U.S. no longer openly supporting the highly artificial trade environment and exchange rates that governed economic relations between the two countries for almost five decades after World War II.[27]
[edit]Consequences
[edit]Asia
The crisis had significant macro-level effects, including sharp reductions in values of currencies, stock markets, and other asset prices of several Asian countries.[28] The nominal US dollar GDP of ASEAN fell by US$9.2 billion in 1997 and $218.2 billion (31.7%) in 1998. In South Korea, the $170.9 billion fall in 1998 was equal to 33.1% of the 1997 GDP.[29] Many businesses collapsed, and as a consequence, millions of people fell below the poverty line in 1997–1998. Indonesia, South Korea and Thailand were the countries most affected by the crisis.
Currency Exchange rate
(per US$1)[30]
Change
June 1997 July 1998
Thai baht
24.5 41 – 40.2%
Indonesian rupiah
2,380 14,150 – 83.2%
Philippine peso
26.3 42 – 37.4%
Malaysian ringgit
2.5 4.1 – 39.0%
South Korean won
850 1,290 – 34.1%
Country GNP (US$1 billion)[30]
Change
June 1997 July 1998
Thailand
170 102 – 40.0%
Indonesia
205 34 – 83.4%
Philippines
75 47 – 37.3%
Malaysia
90 55 – 38.9%
South Korea
430 283 – 34.2%

The above tabulation shows that despite the prompt raising of interest rates to 32% in the Philippines upon the onset of crisis in mid-July 1997, and to 65% in Indonesia upon the intensification of crisis in 1998, their local currencies depreciated just the same and did not perform better than those of South Korea, Thailand, and Malaysia, which countries had their high interest rates set at generally lower than 20% during the Asian crisis. This created grave doubts on the credibility of IMF and the validity of its high-interest-rate prescription to economic crisis.
The economic crisis also led to a political upheaval, most notably culminating in the resignations of President Suharto in Indonesia and Prime Minister General Chavalit Yongchaiyudh in Thailand. There was a general rise in anti-Western sentiment, with George Soros and the IMF in particular singled out as targets of criticisms. Heavy U.S. investment in Thailand ended, replaced by mostly European investment, though Japanese investment was sustained.[citation needed] Islamic and other separatist movements intensified in Southeast Asia as central authorities weakened.[31]
More long-term consequences included reversal of the relative gains made in the boom years just preceding the crisis. Nominal US dollar GDP per capital fell 42.3% in Indonesia in 1997, 21.2% in Thailand, 19% in Malaysia, 18.5% in South Korea and 12.5% in the Philippines. [29] TheCIA World Factbook reported that the per capita income (measured by purchasing power parity) in Thailand declined from $8,800 to $8,300 between 1997 and 2005; in Indonesia it declined from $4,600 to $3,700; in Malaysia it declined from $11,100 to $10,400. Over the same period, world per capita income rose from $6,500 to $9,300.[32] Indeed, the CIA's analysis asserted that the economy of Indonesia was still smaller in 2005 than it had been in 1997, suggesting an impact on that country similar to that of the Great Depression. Within East Asia, the bulk of investment and a significant amount of economic weight shifted from Japan and ASEAN to China and India.[33]
The crisis has been intensively analyzed by economists for its breadth, speed, and dynamism; it affected dozens of countries, had a direct impact on the livelihood of millions, happened within the course of a mere few months, and at each stage of the crisis leading economists, in particular the international institutions, seemed a step behind. Perhaps more interesting to economists was the speed with which it ended, leaving most of the developed economies unharmed. These curiosities have prompted an explosion of literature about financial economics and a litany of explanations why the crisis occurred. A number of critiques have been leveled against the conduct of the IMF in the crisis, including one by former World Bank economist Joseph Stiglitz. Politically there were some benefits. In several countries, particularly South Korea and Indonesia, there was renewed push for improved corporate governance. Rampaging inflation weakened the authority of the Suharto regime and led to its toppling in 1998, as well as accelerating East Timor's independence.[34]
[edit]Outside Asia
After the Asian crisis, international investors were reluctant to lend to developing countries, leading to economic slowdowns in developing countries in many parts of the world. The powerful negative shock also sharply reduced the price of oil, which reached a low of $8 per barreltowards the end of 1998, causing a financial pinch in OPEC nations and other oil exporters. This reduction in oil revenue contributed to the 1998 Russian financial crisis, which in turn caused Long-Term Capital Management in the United States to collapse after losing $4.6 billion in 4 months. A wider collapse in the financial markets was avoided when Alan Greenspan and the Federal Reserve Bank of New York organized a $3.625 billion bail-out. Major emerging economies Brazil and Argentina also fell into crisis in the late 1990s (see Argentine debt crisis).[35]
The crisis in general was part of a global backlash against the Washington Consensus and institutions such as the IMF and World Bank, which simultaneously became unpopular in developed countries following the rise of the anti-globalization movement in 1999. Four major rounds of world trade talks since the crisis, in Seattle, Doha, Cancún, and Hong Kong, have failed to produce a significant agreement as developing countries have become more assertive, and nations are increasingly turning toward regional or bilateral FTAs (Free Trade Agreements) as an alternative to global institutions. Many nations learned from this, and quickly built up foreign exchange reserves as a hedge against attacks, including Japan, China, South Korea. Pan Asian currency swaps were introduced in the event of another crisis. However, interestingly enough, such nations as Brazil, Russia, and India as well as most of East Asia began copying the Japanese model of weakening their currencies, restructuring their economies so as to create a current account surplus to build large foreign currency reserves. This has led to an ever increasing funding for US treasury bonds, allowing or aiding housing (in 2001–2005) and stock asset bubbles (in 1996–2000) to develop in the United States.
[edit]See also
 Financial crisis
 Financial contagion
 List of finance topics
[edit]Notes
1. ^ Kaufman: pp. 195–6
2. ^ http://www.adb.org/Documents/Books/Key_Indicators/2003/pdf/rt29.pdf
3. ^ Pempel: pp 118–143
4. ^ The Myth of Asia's Miracle A Cautionary Fable by Paul Krugman.
5. ^ Hughes, Helen. Crony Capitalism and the East Asian Currency Financial 'Crises'. Policy. Spring 1999.
6. ^ Blustein: p. 73
7. ^ The Three Routes to Financial Crises: The Need for Capital Controls. Gabriel Palma (Cambridge University). Center for Economic Policy Analysis. November 2000.
8. ^ Bernard Eccleston, Michael Dawson, Deborah J. McNamara (1998). The Asia-Pacific Profile. Routledge (UK). ISBN 0415172799.
9. ^ FIRE-SALE FDI by Paul Krugman.
10. ^ Stiglitz: pp. 12–16
11. ^ Joint Comminuque The 30th ASEAN Ministerial Meeting (AMM) The Thirtieth ASEAN Ministerial Meeting was held in Subang Jaya, Malaysia from 24 to 25 July 1997.
12. ^ Halloran, Richard. China's Decisive Role in the Asian Financial Crisis. Global Beat Issue Brief No. 24. 27 January 1998.
13. ^ Noland: pp. 98–103
14. ^ a b IMF's Role in the Asian Financial Crisis by Walden Bello.
15. ^ The IMF Crisis Editorial. Wall Street Journal. 15 April 1998.
16. ^ http://www.columbia.edu/cu/thai/html/financial97_98.html
17. ^ Kaufman: pp. 193–8
18. ^ Liebhold, David. Thailand's Scapegoat? Battling extradition over charges of embezzlement, a financier says he's the fall guy for the 1997 financial crash. TIME.com. 27 December 1999.
19. ^ Pressure from below: Supporters of the new, improved Constitution now have to help turn words into action 10 October 1997
20. ^ "Japan Stocks Slide Again On Fears About Stability". Wall Street Journal Online. 26 December 1997. Retrieved 2 September 2009.
21. ^ http://www.oanda.com/convert/fxhistory August 13 = 2673; August 14 = 2790; August 15 = 2900; August 31 = 2930; October 31 = 3640; December 31 = 5535. Accessed 2009-08-20. Archived 2009-09-04.
22. ^ http://www.oanda.com/convert/fxhistory January 31 = 10,100; March 31 = 8,650; May 31 = 11,350; July 31 = 13,250; September 30 = 10,800. Accessed 2009-08-20. Archived 2009-09-04.
23. ^ Bayani Cruz, We will hold on to blue-chip shares: Tsang, The Standard, 29 August 1998.
24. ^ The CIA World Factbook - Malaysia
25. ^ Ngian Kee Jin: p. 12
26. ^ Pettis: pp. 55–60
27. ^ Pettis: p. 79
28. ^ Tiwari: pp. 1–3
29. ^ a b http://www.adb.org/Documents/Books/Key_Indicators/2001/rt11_ki2001.xls
30. ^ a b Cheetham, R. 1998. Asia Crisis. Paper presented at conference, U.S.-ASEAN-Japan policy Dialogue. School of Advanced International Studies of Johns Hopkins University, June 7–9, Washington, D.C.
31. ^ Radelet: pp. 5–6
32. ^ The Asian financial crisis ten years later: assessing the past and looking to the future. Janet L. Yellen. Speech to the Asia Society of Southern California, Los Angeles, California, 6 February 2007
33. ^ Kilgour, Andrea (1999). The changing economic situation in Vietnam: A product of the Asian crisis?
34. ^ Weisbrot: p. 6
35. ^ The Crash transcript. PBS Frontline.
[edit]References
[edit]Books
 Kaufman, GG., Krueger, TH., Hunter, WC. (1999) The Asian Financial Crisis: Origins, Implications and Solutions. Springer. ISBN 0792384725
 Pettis, Michael (2001). The Volatility Machine: Emerging Economies and the Threat of Financial Collapse. Oxford University Press. ISBN 0-19-514330-2.
 Blustein, Paul (2001). The Chastening: Inside the Crisis that Rocked the Global Financial System and Humbled the IMF. PublicAffairs.ISBN 1-891620-81-9.
 Noland, Markus, Li-gang Liu, Sherman Robinson, and Zhi Wang. (1998) Global Economic Effects of the Asian Currency Devaluations. Policy Analyses in International Economics, no. 56. Washington, DC: Institute for International Economics.
 Pempel, T. J. (1999) The Politics of the Asian Economic Crisis. Ithaca, NY: Cornell University Press.
 Ries, Philippe. (2000) The Asian Storm: Asia's Economic Crisis Examined.
 Tecson, Marcelo L. (2005) Puzzlers: Economic Sting (The Case Against IMF, Central Banks, and IMF-Prescribed High Interest Rates) Makati City, Philippines: Raiders of the Lost Gold Publication
 Muchhala, Bhumika, ed. (2007) Ten Years After: Revisiting the Asian Financial Crisis[1]. Washington, DC: Woodrow Wilson International Center for Scholars Asia Program.
 Ito, Takatoshi and Andrew K. Rose (2006). Financial Sector Development in the Pacific Rim. University of Chicago Press. ISBN 9780226386843.
[edit]Papers
 Ngian Kee Jin (March 2000). Coping with the Asian Financial Crisis: The Singapore Experience. Institute of Southeast Asian Studies. ISSN 0219-3582
 Tiwari, Rajnish (2003). Post-crisis Exchange Rate Regimes in Southeast Asia, Seminar Paper, University of Hamburg.
 Kilgour, Andrea (1999). The changing economic situation in Vietnam: A product of the Asian crisis?
 S. Radelet, J.D. Sachs, R.N. Cooper, B.P. Bosworth (1998). The East Asian Financial Crisis: Diagnosis, Remedies, Prospects. Brookings Papers on Economic Activity.
 Stiglitz, Joseph (1996). Some Lessons From The East Asian Miracle. The World Bank Research Observer.
 Weisbrot, Mark (August 2007). Ten Years After: The Lasting Impact of the Asian Financial Crisis. Center for Economic and Policy Research.
 Tecson, Marcelo L. (2009), "IMF Must Renounce Its Weapon of Mass Destruction: High Interest Rates" (4-part paper on high-interest-rate fallacies and alternatives, emailed to IMF and others on January 27, 2009)
[edit]Other
 Is Thailand on the road to recovery, article by Australian photo-journalist John Le Fevre that looks at the effects of the Asian Economic Crisis on Thailand's construction industry
 Women bear brunt of crisis, article by Australian photo-journalist John Le Fevre examining the effects of the Asian Economic Crisis on Asia's female workforce
 The Crash (transcript only), from the PBS series Frontline

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This article is about background financial market events dating from July 2007. For an overview of all economic problems during the late 2000s, see Late 2000s recession.
Part of a series on:
2007–2009 financial crisis
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 Iceland
 Ireland
 Latvia
 Russia
 Spain

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Causes[show]

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v • d • e

The financial crisis of 2007–2009 has been called the worst financial crisis since the one related to the Great Depression by leading economists,[1] and it contributed to the failure of key businesses, declines in consumer wealth estimated in the trillions of U.S. dollars, substantial financial commitments incurred by governments, and a significant decline in economic activity.[2] Many causes have been proposed, with varying weight assigned by experts.[3] Both market-based and regulatory solutions have been implemented or are under consideration,[4] while significant risks remain for the world economy.[5]
Contents
[hide]
• 1 Background and causes
o 1.1 Growth of the housing bubble
o 1.2 Easy credit conditions
o 1.3 Sub-prime lending
o 1.4 Predatory lending
o 1.5 Deregulation
o 1.6 Increased debt burden or over-leveraging
o 1.7 Financial innovation and complexity
o 1.8 Credit Ratings
o 1.9 Boom and collapse of the shadow banking system
o 1.10 Commodity bubble
o 1.11 Systemic crisis
o 1.12 Role of economic forecasting
• 2 Financial markets impacts
o 2.1 Impacts on financial institutions
o 2.2 Credit markets and the shadow banking system
o 2.3 Wealth effects
o 2.4 Global contagion
• 3 Effects on the global economy
o 3.1 Global effects
o 3.2 U.S. economic effects
o 3.3 Official economic projections
• 4 Responses to financial crisis
o 4.1 Emergency and short-term responses
o 4.2 Regulatory proposals and long-term responses
• 5 See also
• 6 References
• 7 External links and further reading

[edit]Background and causes
The immediate cause or trigger of the crisis was the bursting of the United States housing bubble which peaked in approximately 2005–2006.[6][7] High default rates on "subprime" and adjustable rate mortgages (ARM), began to increase quickly thereafter. An increase in loan incentives such as easy initial terms and a long-term trend of rising housing prices had encouraged borrowers to assume difficult mortgages in the belief they would be able to quickly refinance at more favorable terms. However, once interest rates began to rise and housing prices started to drop moderately in 2006–2007 in many parts of the U.S., refinancing became more difficult. Defaults and foreclosure activity increased dramatically as easy initial terms expired, home prices failed to go up as anticipated, and ARM interest rates reset higher.


Share in GDP of U.S. financial sector since 1860.[8]
In the years leading up to the start of the crisis in 2007, significant amounts of foreign money flowed into the U.S. from fast-growing economies in Asia and oil-producing countries. This inflow of funds made it easier for the Federal Reserve to keep interest rates in the United States too low (by the Taylor rule) from 2002–2006 which contributed to easy credit conditions, leading to the United States housing bubble. Loans of various types (e.g., mortgage, credit card, and auto) were easy to obtain and consumers assumed an unprecedented debt load.[9][10] As part of the housing and credit booms, the amount of financial agreements called mortgage-backed securities (MBS), which derive their value from mortgage payments and housing prices, greatly increased. Such financial innovation enabled institutions and investors around the world to invest in the U.S. housing market. As housing prices declined, major global financial institutions that had borrowed and invested heavily in subprime MBS reported significant losses. Falling prices also resulted in homes worth less than the mortgage loan, providing a financial incentive to enter foreclosure. The ongoing foreclosure epidemic that began in late 2006 in the U.S. continues to drain wealth from consumers and erodes the financial strength of banking institutions. Defaults and losses on other loan types also increased significantly as the crisis expanded from the housing market to other parts of the economy. Total losses are estimated in the trillions of U.S. dollars globally.[11]
While the housing and credit bubbles built, a series of factors caused the financial system to both expand and become increasingly fragile. Policymakers did not recognize the increasingly important role played by financial institutions such as investment banks and hedge funds, also known as the shadow banking system. Some experts believe these institutions had become as important as commercial (depository) banks in providing credit to the U.S. economy, but they were not subject to the same regulations.[12] These institutions as well as certain regulated banks had also assumed significant debt burdens while providing the loans described above and did not have a financial cushion sufficient to absorb large loan defaults or MBS losses.[13] These losses impacted the ability of financial institutions to lend, slowing economic activity. Concerns regarding the stability of key financial institutions drove central banks to provide funds to encourage lending and restore faith in thecommercial paper markets, which are integral to funding business operations. Governments also bailed out key financial institutions and implemented economic stimulus programs, assuming significant additional financial commitments.
[edit]Growth of the housing bubble
Main article: United States housing bubble
Between 1997 and 2006, the price of the typical American house increased by 124%.[14] During the two decades ending in 2001, the national median home price ranged from 2.9 to 3.1 times median household income. This ratio rose to 4.0 in 2004, and 4.6 in 2006.[15] This housing bubble resulted in quite a few homeowners refinancing their homes at lower interest rates, or financing consumer spending by taking out second mortgages secured by the price appreciation.
Free cash used by consumers from home equity extraction doubled from $627 billion in 2001 to $1,428 billion in 2005 as the housing bubble built, a total of nearly $5 trillion dollars over the period, contributing to economic growth worldwide.[16][17][18] U.S. home mortgage debt relative to GDP increased from an average of 46% during the 1990s to 73% during 2008, reaching $10.5 trillion.[19]
By September 2008, average U.S. housing prices had declined by over 20% from their mid-2006 peak.[20][21] Easy credit, and a belief that house prices would continue to appreciate, had encouraged many subprime borrowers to obtain adjustable-rate mortgages.[dubious – discuss]These mortgages enticed borrowers with a below market interest rate for some predetermined period, followed by market interest rates for the remainder of the mortgage's term. Borrowers who could not make the higher payments once the initial grace period ended would try to refinance their mortgages. Refinancing became more difficult, once house prices began to decline in many parts of the USA. Borrowers who found themselves unable to escape higher monthly payments by refinancing began to default. During 2007, lenders had begun foreclosure proceedings on nearly 1.3 million properties, a 79% increase over 2006.[22] This increased to 2.3 million in 2008, an 81% increase vs. 2007.[23]As of August 2008, 9.2% of all mortgages outstanding were either delinquent or in foreclosure.[24]
[edit]Easy credit conditions
From 2000 to 2003, the Federal Reserve lowered the federal funds rate target from 6.5% to 1.0%.[25] This was done to soften the effects of the collapse of the dot-com bubble and of the September 2001 terrorist attacks, and to combat the perceived risk of deflation.[26] The Fed then raised the Fed funds rate significantly between July 2004 and July 2006.[27] This contributed to an increase in 1-year and 5-year adjustable-rate mortgage (ARM) rates, making ARM interest rate resets more expensive for homeowners.[28] This may have also contributed to the deflating of the housing bubble, as asset prices generally move inversely to interest rates and it became riskier to speculate in housing.[29][30]


U.S. Current Account or Trade Deficit
In 2005, Ben Bernanke addressed the implications of the USA's high and rising current account (trade) deficit, resulting from USA imports exceeding its exports.[31] Between 1996 and 2004, the USA current account deficit increased by $650 billion, from 1.5% to 5.8% of GDP. Financing these deficits required the USA to borrow large sums from abroad, much of it from countries running trade surpluses, mainly the emerging economies in Asia and oil-exporting nations. The balance of payments identity requires that a country (such as the USA) running a current account deficit also have a capital account (investment) surplus of the same amount. Hence large and growing amounts of foreign funds (capital) flowed into the USA to finance its imports. This created demand for various types of financial assets, raising the prices of those assets while lowering interest rates. Foreign investors had these funds to lend, either because they had very high personal savings rates (as high as 40% in China), or because of high oil prices. Bernanke referred to this as a "saving glut."[32] A "flood" of funds (capital or liquidity) reached the USA financial markets. Foreign governments supplied funds by purchasing USA Treasury bonds and thus avoided much of the direct impact of the crisis. USA households, on the other hand, used funds borrowed from foreigners to finance consumption or to bid up the prices of housing and financial assets. Financial institutions invested foreign funds in mortgage-backed securities. USA housing and financial assets dramatically declined in value after the housing bubble burst.[33][34]
[edit]Sub-prime lending


U.S. Subprime lending expanded dramatically 2004-2006
In addition to easy credit conditions, there is evidence that both government and competitive pressures contributed to an increase in the amount of subprime lending during the years preceding the crisis. Major U.S. investment banks and government sponsored enterprises like Fannie Mae[dubious – discuss] played an important role in the expansion of higher-risk lending.[35][36]
The term subprime refers to the credit quality of particular borrowers, who have weakened credit histories and a greater risk of loan default than prime borrowers.[37] The value of U.S. subprime mortgages was estimated at $1.3 trillion as of March 2007,[38] with over 7.5 million first-lien subprime mortgages outstanding.[39]
Subprime mortgages remained below 10% of all mortgage originations until 2004, when they spiked to nearly 20% and remained there through the 2005-2006 peak of the United States housing bubble.[40] A proximate event to this increase was the April 2004 decision by the U.S. Securities and Exchange Commission (SEC) to relax the net capital rule, which encouraged the largest five investment banks to dramatically increase their financial leverage and aggressively expand their issuance of mortgage-backed securities. This applied additional competitive pressure to Fannie Mae and Freddie Mac, which further expanded their riskier lending.[41] Subprime mortgage payment delinquency rates remained in the 10-15% range from 1998 to 2006[42], then began to increase rapidly, rising to 25% by early 2008.[43][44]
Some, like American Enterprise Institute fellow Peter J. Wallison[45], believe the roots of the crisis can be traced directly to sub-prime lending by Fannie Mae and Freddie Mac, which are government sponsored entities. On 30 September 1999, The New York Times reported that the Clinton Administration pushed for sub-prime lending: "Fannie Mae, the nation's biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people...In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980s."[46]
In 1995, the administration also tinkered with President Jimmy Carter's Community Reinvestment Act of 1977 by regulating and strengthening the anti-redlining procedures. The result was a push by the administration for greater investment, by financial institutions, into riskier loans. A 2000 United States Department of the Treasury study of lending trends for 305 cities from 1993 to 1998 showed that $467 billion of mortgage credit poured out of CRA-covered lenders into low and mid level income borrowers and neighborhoods.[47]
Others have pointed out that there were not enough of these loans made to cause a crisis of this magnitude. In an article in Portfolio Magazine,Michael Lewis spoke with one trader who noted that "There weren’t enough Americans with [bad] credit taking out [bad loans] to satisfy investors’ appetite for the end product." Essentially, investment banks and hedge funds used financial innovation to synthesize more loans using derivatives. "They were creating [loans] out of whole cloth. One hundred times over! That’s why the losses are so much greater than the loans."[48]
[edit]Predatory lending
Predatory lending refers to the practice of unscrupulous lenders, to enter into "unsafe" or "unsound" secured loans for inappropriate purposes.[49] A classic bait-and-switch method was used by Countrywide, advertising low interest rates for home refinancing. Such loans were written into extensively detailed contracts, and swapped for more expensive loan products on the day of closing. Whereas the advertisement might state that 1% or 1.5% interest would be charged, the consumer would be put into an adjustable rate mortgage (ARM) in which the interest charged would be greater than the amount of interest paid. This created negative amortization, which the credit consumer might not notice until long after the loan transaction had been consummated.
Countrywide, sued by California Attorney General Jerry Brown for "Unfair Business Practices" and "False Advertising" was making high cost mortgages "to homeowners with weak credit, adjustable rate mortgages (ARMs) that allowed homeowners to make interest-only payments."[50]. When housing prices decreased, homeowners in ARMs then had little incentive to pay their monthly payments, since their home equity had disappeared. This caused Countrywide's financial condition to deteriorate, ultimately resulting in a decision by the Office of Thrift Supervision to seize the lender.
Countrywide, according to Republican Lawmakers, had involved itself in making low-cost loans to politicians, for purposes of gaining political favors.[51].
Former employees from Ameriquest, which was United States's leading wholesale lender,[52] described a system in which they were pushed to falsify mortgage documents and then sell the mortgages to Wall Street banks eager to make fast profits.[52] There is growing evidence that such mortgage frauds may be a cause of the crisis.[52]
[edit]Deregulation
Further information: Government policies and the subprime mortgage crisis
Critics have argued that the regulatory framework did not keep pace with financial innovation, such as the increasing importance of the shadow banking system, derivatives and off-balance sheet financing. In other cases, laws were changed or enforcement weakened in parts of the financial system. Key examples include:
 In October 1982, President Ronald Reagan signed into Law the Garn-St. Germain Depository Institutions Act, which began the process of Banking deregulation that helped contribute to the savings and loan crises of the late 80's/early 90's, and the financial crises of 2007-2009. President Reagan stated at the signing, "all in all, I think we hit the jackpot".[53]
 In November 1999, President Bill Clinton signed into Law the Gramm-Leach-Bliley Act, which repealed part of the Glass-Steagall Act of 1933. This repeal has been criticized for reducing the separation between commercial banks (which traditionally had a conservative culture) and investment banks (which had a more risk-taking culture).[54][55]
 In 2004, the Securities and Exchange Commission relaxed the net capital rule, which enabled investment banks to substantially increase the level of debt they were taking on, fueling the growth in mortgage-backed securities supporting subprime mortgages. The SEC has conceded that self-regulation of investment banks contributed to the crisis.[56][57]
 Financial institutions in the shadow banking system are not subject to the same regulation as depository banks, allowing them to assume additional debt obligations relative to their financial cushion or capital base.[58] This was the case despite the Long-Term Capital Management debacle in 1998, where a highly-leveraged shadow institution failed with systemic implications.
 Regulators and accounting standard-setters allowed depository banks such as Citigroup to move significant amounts of assets and liabilities off-balance sheet into complex legal entities called structured investment vehicles, masking the weakness of the capital base of the firm or degree of leverage or risk taken. One news agency estimated that the top four U.S. banks will have to return between $500 billion and $1 trillion to their balance sheets during 2009.[59] This increased uncertainty during the crisis regarding the financial position of the major banks.[60] Off-balance sheet entities were also used by Enron as part of the scandal that brought down that company in 2001.[61]
 As early as 1997, Fed Chairman Alan Greenspan fought to keep the derivatives market unregulated.[62] With the advice of the President's Working Group on Financial Markets,[63] the U.S. Congress and President allowed the self-regulation of the over-the-counter derivatives market when they enacted the Commodity Futures Modernization Act of 2000. Derivatives such as credit default swaps (CDS) can be used to hedge or speculate against particular credit risks. The volume of CDS outstanding increased 100-fold from 1998 to 2008, with estimates of the debt covered by CDS contracts, as of November 2008, ranging from US$33 to $47 trillion. Total over-the-counter (OTC) derivative notional value rose to $683 trillion by June 2008.[64] Warren Buffett famously referred to derivatives as "financial weapons of mass destruction" in early 2003.[65][66]
[edit]Increased debt burden or over-leveraging


Leverage Ratios of Investment Banks Increased Significantly 2003-2007
U.S. households and financial institutions became increasingly indebted or overleveraged during the years preceding the crisis. This increased their vulnerability to the collapse of the housing bubble and worsened the ensuing economic downturn. Key statistics include:
 USA household debt as a percentage of annual disposable personal income was 127% at the end of 2007, versus 77% in 1990.[67]
 U.S. home mortgage debt relative to gross domestic product (GDP) increased from an average of 46% during the 1990s to 73% during 2008, reaching $10.5 trillion.[19]
 In 1981, U.S. private debt was 123% of GDP; by the third quarter of 2008, it was 290%.[68]
 From 2004-07, the top five U.S. investment banks each significantly increased their financial leverage (see diagram), which increased their vulnerability to a financial shock. These five institutions reported over $4.1 trillion in debt for fiscal year 2007, about 30% of USA nominal GDP for 2007. Lehman Brothers was liquidated, Bear Stearns andMerrill Lynch were sold at fire-sale prices, and Goldman Sachs and Morgan Stanley became commercial banks, subjecting themselves to more stringent regulation. With the exception of Lehman, these companies required or received government support.[69]
 Fannie Mae and Freddie Mac, two U.S. Government sponsored enterprises, owned or guaranteed nearly $5 trillion in mortgage obligations at the time they were placed into conservatorship by the U.S. government in September 2008.[70][71]
These seven entities were highly leveraged and had $9 trillion in debt or guarantee obligations, an enormous concentration of risk, yet were not subject to the same regulation as depository banks.

The Asian Financial Crisis was a period of financial crisis that gripped much of Asia beginning in July 1997, and raised fears of a worldwide economic meltdown due to financial contagion.
The crisis started in Thailand with the financial collapse of the Thai baht caused by the decision of the Thai government to float the baht, cutting its peg to the USD, after exhaustive efforts to support it in the face of a severe financial overextension that was in part real estate driven. At the time, Thailand had acquired a burden of foreign debt that made the country effectively bankrupt even before the collapse of its currency. As the crisis spread, most of Southeast Asia and Japan saw slumping currencies, devalued stock markets and other asset prices, and a precipitous rise in private debt.[1]
Though there has been general agreement on the existence of a crisis and its consequences, what is less clear is the causes of the crisis, as well as its scope and resolution. Indonesia, South Korea and Thailandwere the countries most affected by the crisis. Hong Kong, Malaysia, Laos and the Philippines were also hurt by the slump. The People's Republic of China, India, Taiwan, Singapore, Brunei and Vietnam were less affected, although all suffered from a loss of demand and confidence throughout the region.
Foreign debt-to-GDP ratios rose from 100% to 167% in the four large ASEAN economies in 1993–96, then shot up beyond 180% during the worst of the crisis. In South Korea, the ratios rose from 13 to 21% and then as high as 40%, while the other Northern NICs (Newly Industrialized Countries) fared much better. Only in Thailand and South Korea did debt service-to-exports ratios rise.[2]
Although most of the governments of Asia had seemingly sound fiscal policies, the International Monetary Fund (IMF) stepped in to initiate a $40 billion program to stabilize the currencies of South Korea, Thailand, and Indonesia, economies particularly hard hit by the crisis. The efforts to stem a global economic crisis did little to stabilize the domestic situation in Indonesia, however. After 30 years in power, President Suhartowas forced to step down on 21 May 1998 in the wake of widespread rioting that followed sharp price increases caused by a drastic devaluation of the rupiah. The effects of the crisis lingered through 1998. In the Philippines growth dropped to virtually zero in 1998. Only Singapore and Taiwan proved relatively insulated from the shock, but both suffered serious hits in passing, the former more so due to its size and geographical location between Malaysia and Indonesia. By 1999, however, analysts saw signs that the economies of Asia were beginning to recover.[3]



History
Until 1997, Asia attracted almost half of the total capital inflow to developing countries. The economies of Southeast Asia in particular maintained high interest rates attractive to foreign investors looking for a high rate of return. As a result the region's economies received a large inflow of money and experienced a dramatic run-up in asset prices. At the same time, the regional economies of Thailand, Malaysia, Indonesia,Singapore, and South Korea experienced high growth rates, 8–12% GDP, in the late 1980s and early 1990s. This achievement was widely acclaimed by financial institutions including the IMF and World Bank, and was known as part of the "Asian economic miracle".
In 1994, noted economist Paul Krugman published an article attacking the idea of an "Asian economic miracle".[4] He argued that East Asia's economic growth had historically been the result of increasing capital investment. However, total factor productivity had increased only marginally or not at all. Krugman argued that only growth in total factor productivity, and not capital investment, could lead to long-termprosperity. Krugman's views would be seen by many as prescient after the financial crisis had become apparent, though he himself stated that he had not predicted the crisis nor foreseen its depth.[citation needed]
The causes of the debacle are many and disputed. Thailand's economy developed into a bubble fueled by "hot money". More and more was required as the size of the bubble grew. The same type of situation happened in Malaysia, and Indonesia, which had the added complication of what was called "crony capitalism".[5] The short-term capital flow was expensive and often highly conditioned for quick profit. Development money went in a largely uncontrolled manner to certain people only, not particularly the best suited or most efficient, but those closest to the centers of power.[6]
At the time of the mid-1990s, Thailand, Indonesia and South Korea had large private current account deficits and the maintenance of fixed exchange rates encouraged external borrowing and led to excessive exposure to foreign exchange risk in both the financial and corporate sectors. In the mid-1990s, two factors began to change their economic environment. As the U.S. economy recovered from a recession in the early 1990s, the U.S. Federal Reserve Bank under Alan Greenspan began to raise U.S. interest rates to head off inflation. This made the U.S. a more attractive investment destination relative to Southeast Asia, which had attracted hot money flows through high short-term interest rates, and raised the value of the U.S. dollar, to which many Southeast Asian nations' currencies were pegged, thus making their exports less competitive. At the same time, Southeast Asia's export growth slowed dramatically in the spring of 1996, deteriorating their current account position.
Some economists have advanced the growing exports of China as a contributing factor to ASEAN nations' export growth slowdown, though these economists maintain the main cause of the crises was excessive real estate speculation.[7] China had begun to compete effectively with other Asian exporters particularly in the 1990s after the implementation of a number of export-oriented reforms. Other economists dispute China's impact, noting that both ASEAN and China experienced simultaneous rapid export growth in the early 1990s.[8]
Many economists believe that the Asian crisis was created not by market psychology or technology, but by policies that distorted incentives within the lender–borrower relationship. The resulting large quantities of credit that became available generated a highly leveraged economic climate, and pushed up asset prices to an unsustainable level.[9] These asset prices eventually began to collapse, causing individuals and companies to default on debt obligations. The resulting panic among lenders led to a large withdrawal of credit from the crisis countries, causing a credit crunch and further bankruptcies. In addition, as foreign investors attempted to withdraw their money, the exchange market was flooded with the currencies of the crisis countries, putting depreciative pressure on their exchange rates. To prevent currency values collapsing, these countries' governments raised domestic interest rates to exceedingly high levels (to help diminish flight of capital by making lending more attractive to investors) and to intervene in the exchange market, buying up any excess domestic currency at the fixed exchange rate withforeign reserves. Neither of these policy responses could be sustained for long. Very high interest rates, which can be extremely damaging to an economy that is healthy, wreaked further havoc on economies in an already fragile state, while the central banks were hemorrhaging foreign reserves, of which they had finite amounts. When it became clear that the tide of capital fleeing these countries was not to be stopped, the authorities ceased defending their fixed exchange rates and allowed their currencies to float. The resulting depreciated value of those currencies meant that foreign currency-denominated liabilities grew substantially in domestic currency terms, causing more bankruptcies and further deepening the crisis.
Other economists, including Joseph Stiglitz and Jeffrey Sachs, have downplayed the role of the real economy in the crisis compared to the financial markets. The rapidity with which the crisis happened has prompted Sachs and others to compare it to a classic bank run prompted by a sudden risk shock. Sachs pointed to strict monetary and contractory fiscal policies implemented by the governments on the advice of the IMF in the wake of the crisis, while Frederic Mishkin points to the role of asymmetric information in the financial markets that led to a "herd mentality" among investors that magnified a small risk in the real economy. The crisis had thus attracted interest from behavioral economistsinterested in market psychology. Another possible cause of the sudden risk shock may also be attributable to the handover of Hong Kong sovereignty on 1 July 1997. During the 1990s, hot money flew into the Southeast Asia region but investors were often ignorant of the actual fundamentals or risk profiles of the respective economies. The uncertainty regarding the future of Hong Kong led investors to shrink even further away from Asia, exacerbating economic conditions in the area (subsequently leading to the devaluation of the Thai baht on 2 July 1997).[10]
The foreign ministers of the 10 ASEAN countries believed that the well co-ordinated manipulation of their currencies was a deliberate attempt to destabilize the ASEAN economies. Former Malaysian Prime Minister Mahathir Mohamad accused George Soros of ruining Malaysia's economy with "massive currency speculation." (Soros appeared to have had his bets in against the Asian currency devaluations, incurring a loss when the crisis hit.[citation needed]) At the 30th ASEAN Ministerial Meeting held in Subang Jaya, Malaysia, they issued a joint declaration on 25 July 1997 expressing serious concern and called for further intensification of ASEAN's cooperation to safeguard and promote ASEAN's interest in this regard.[11] Coincidentally, on that same day, the central bankers of most of the affected countries were at the EMEAP (Executive Meeting of East Asia Pacific) meeting in Shanghai, and they failed to make the 'New Arrangement to Borrow' operational. A year earlier, the finance ministers of these same countries had attended the 3rd APEC finance ministers meeting in Kyoto, Japan on 17 March 1996, and according to that joint declaration, they had been unable to double the amounts available under the 'General Agreement to Borrow' and the 'Emergency Finance Mechanism'. As such, the crisis could be seen as the failure to adequately build capacity in time to prevent Currency Manipulation. This hypothesis enjoyed little support among economists, however, who argue that no single investor could have had enough impact on the market to successfully manipulate the currencies' values. In addition, the level of organization necessary to coordinate a massive exodus of investors from Southeast Asian currencies in order to manipulate their values rendered this possibility remote.
[edit]IMF Role
Such was the scope and the severity of the collapses involved that outside intervention, considered by many as a new kind of colonialism,[12]became urgently needed. Since the countries melting down were among not only the richest in their region, but in the world, and since hundreds of billions of dollars were at stake, any response to the crisis had to be cooperative and international, in this case through theInternational Monetary Fund (IMF). The IMF created a series of bailouts ("rescue packages") for the most affected economies to enable affected nations to avoid default, tying the packages to reforms that were intended to make the restored Asian currency, banking, and financial systems as much like those of the United States and Europe as possible. In other words, the IMF's support was conditional on a series of drastic economic reforms influenced by neoliberal economic principles called a "structural adjustment package" (SAP). The SAPs called on crisis-struck nations to cut back on government spending to reduce deficits, allow insolvent banks and financial institutions to fail, and aggressively raise interest rates. The reasoning was that these steps would restore confidence in the nations' fiscal solvency, penalize insolvent companies, and protect currency values. Above all, it was stipulated that IMF-funded capital had to be administered rationally in the future, with no favored parties receiving funds by preference. There were to be adequate government controls set up to supervise all financial activities, ones that were to be independent, in theory, of private interest. Insolvent institutions had to be closed, and insolvency itself had to be clearly defined. In short, exactly the same kinds of financial institutions found in the United States and Europe had to be created in Asia, as a condition for IMF support. In addition, financial systems had to become "transparent", that is, provide the kind of reliable financial information used in the West to make sound financial decisions.[13]
However, the greatest criticism of the IMF's role in the crisis was targeted towards its response.[14] As country after country fell into crisis, many local businesses and governments that had taken out loans in US dollars, which suddenly became much more expensive relative to the local currency which formed their earned income, found themselves unable to pay their creditors. The dynamics of the situation were closely similar to that of the Latin American debt crisis. The effects of the SAPs were mixed and their impact controversial. Critics, however, noted the contractionary nature of these policies, arguing that in a recession, the traditional Keynesian response was to increase government spending, prop up major companies, and lower interest rates. The reasoning was that by stimulating the economy and staving off recession, governments could restore confidence while preventing economic loss. They pointed out that the U.S. government had pursued expansionary policies, such as lowering interest rates, increasing government spending, and cutting taxes, when the United States itself entered a recession in 2001, and arguably the same in the fiscal and monetary policies during the 2008–2009 Global Financial Crisis.
Although such reforms were, in most cases, long needed, the countries most involved ended up undergoing an almost complete political and financial restructuring. They suffered permanent currency devaluations, massive numbers of bankruptcies, collapses of whole sectors of once-booming economies, real estate busts, high unemployment, and social unrest. For most of the countries involved, IMF intervention has been roundly criticized. The role of the International Monetary Fund was so controversial during the crisis that many locals called the financial crisis the "IMF crisis".[15] Many commentators in retrospect criticized the IMF for encouraging the developing economies of Asia down the path of "fast track capitalism", meaning liberalization of the financial sector (elimination of restrictions on capital flows); maintenance of high domestic interest rates to attract portfolio investment and bank capital; and pegging of the national currency to the dollar to reassure foreign investors against currency risk.[14]
[edit]IMF and high interest rates
The conventional high-interest-rate economic wisdom is normally employed by monetary authorities to attain the chain objectives of tightened money supply, discouraged currency speculation, stabilized exchange rate, curbed currency depreciation, and ultimately contained inflation.
In the Asian meltdown, highest IMF officials rationalized their prescribed high interest rates as follows:
From then IMF First Deputy Managing Director, Stanley Fischer (Stanley Fischer, "The IMF and the Asian Crisis," Forum Funds Lecture at UCLA, Los Angeles on March 20, 1998):
”When their governments "approached the IMF, the reserves of Thailand and South Korea were perilously low, and the Indonesian Rupiah was excessively depreciated. Thus, the first order of business was... to restore confidence in the currency. To achieve this, countries have to make it more attractive to hold domestic currency, which in turn, requires increasing interest rates temporarily, even if higher interest costs complicate the situation of weak banks and corporations...
"Why not operate with lower interest rates and a greater devaluation? This is a relevant tradeoff, but there can be no question that the degree of devaluation in the Asian countries is excessive, both from the viewpoint of the individual countries, and from the viewpoint of the international system. Looking first to the individual country, companies with substantial foreign currency debts, as so many companies in these countries have, stood to suffer far more from… currency (depreciation) than from a temporary rise in domestic interest rates…. Thus, on macroeconomics… monetary policy has to be kept tight to restore confidence in the currency..."
From the then IMF Managing Director Michel Camdessus himself ("Doctor Knows Best?" Asiaweek, July 17, 1998, p. 46):
"To reverse (currency depreciation), countries have to make it more attractive to hold domestic currency, and that means temporarily raising interest rates, even if this (hurts) weak banks and corporations."
IMF’s high-interest-rate prescription in the Asian turmoil was quite controversial because it was not the moderate increase in interest rates of usually fraction of one percent, as done in both advanced and developing nations during normal times, but bad-loan provoking high bank lending rates of as much as 60%, as actually implemented during the crisis, especially in the Philippines and Indonesia which had to bear peak non-prime high interest rates of up to 40% and 65%, respectively. The high interest rates, which were a matter of record in the crisis-hit Asian nations, became necessary because of IMF’s prior failure to prescribe to the Asian nations under its sway the needed exchange rate hedging on foreign fund inflow—loans and investments—that surged into the region under the aegis of globalization and currency liberalization promoted by IMF. When the Asian financial crisis erupted in Thailand, it provoked contagion crisis in perceived similarly situated Asian economies. To prevent capital flight that would undermine the exchange rate, IMF prescribed high interest rates aimed at stabilizing exchange rates and saving dollar-debt-ridden Asian corporations from staggering exchange losses on their unhedged foreign loans. The exchange losses could have caused their collapse, with consequent humongous bad loans to their foreign creditors—banks and non-banks—in advanced nations that rule IMF. Thus, instead of leaving economic players by themselves under free market—which meant having the stockholder-owners of dollar-debt-laden Asian companies suffer huge exchange losses from their negligence to hedge on their foreign loans—IMF disturbed the financial market by having discriminated Asian borrowers save, through impoverishing high interest rates, dollar-debt-laden Asian corporations that they do not own, from which they did not derive profits in the past, and from which they will not derive profits in the future. In sum, the high interest rates were not designed to save the ailing Asian economies. These were aimed at saving the Asian corporations' foreign creditors from bad loans, and never mind the concomitant massacre of Asian banks and borrowers from IMF's high-interest-rate prescription.
[edit]Thailand
Further information: Economy of Thailand
From 1985 to 1996, Thailand's economy grew at an average of over 9% per year, the highest economic growth rate of any country at the time. Inflation was kept reasonably low within a range of 3.4–5.7%[16]. The baht was pegged at 25 to the US dollar.
On 14 May and 15 May 1997, the Thai baht was hit by massive speculative attacks. On 30 June 1997, Prime Minister Chavalit Yongchaiyudhsaid that he would not devalue the baht. This was the spark that ignited the Asian financial crisis as the Thai government failed to defend the baht, which was pegged to the U.S. dollar, against international speculators. Thailand's booming economy came to a halt amid massive layoffsin finance, real estate, and construction that resulted in huge numbers of workers returning to their villages in the countryside and 600,000 foreign workers being sent back to their home countries.[17] The baht devalued swiftly and lost more than half of its value. The baht reached its lowest point of 56 units to the US dollar in January 1998. The Thai stock market dropped 75%. Finance One, the largest Thai finance company until then, collapsed.[18]
The Thai government was eventually forced to float the Baht, on 2 July 1997. On 11 August 1997, the IMF unveiled a rescue package for Thailand with more than $17 billion, subject to conditions such as passing laws relating to bankruptcy (reorganizing and restructuring) procedures and establishing strong regulation frameworks for banks and other financial institutions. The IMF approved on 20 August, 1997, another bailout package of $3.9 billion.
Thai opposition parties claimed that former Prime Minister Thaksin Shinawatra had profited from the devaluation,[19] It is now being investigated by the court of justice [though it should be added -a skewed judiciary currently emplaced with passionate anti-Thaksinites].
By 2001, Thailand's economy had recovered. The increasing tax revenues allowed the country to balance its budget and repay its debts to the IMF in 2003, four years ahead of schedule. This was due to the effective management of the national economy during Thaksin's Government. The Thai baht continued to appreciate to 34 Baht to the Dollar in July 2008.
[edit]Indonesia
See also: Fall of Suharto and Economy of Indonesia
In June 1997, Indonesia seemed far from crisis. Unlike Thailand, Indonesia had low inflation, a trade surplus of more than $900 million, huge foreign exchange reserves of more than $20 billion, and a good banking sector. But a large number of Indonesian corporations had been borrowing in U.S. dollars. During the preceding years, as the rupiah had strengthened respective to the dollar, this practice had worked well for these corporations; their effective levels of debt and financing costs had decreased as the local currency's value rose.
In July 1997, when Thailand floated the baht, Indonesia's monetary authorities widened the rupiah trading band from 8% to 12%. The rupiah suddenly came under severe attack in August. On 14 August 1997, the managed floating exchange regime was replaced by a free-floating exchange rate arrangement. The rupiah dropped further. The IMF came forward with a rescue package of $23 billion, but the rupiah was sinking further amid fears over corporate debts, massive selling of rupiah, and strong demand for dollars. The rupiah and the Jakarta Stock Exchangetouched a historic low in September. Moody's eventually downgraded Indonesia's long-term debt to 'junk bond'.[20]
Although the rupiah crisis began in July and August 1997, it intensified in November when the effects of that summer devaluation showed up on corporate balance sheets. Companies that had borrowed in dollars had to face the higher costs imposed upon them by the rupiah's decline, and many reacted by buying dollars through selling rupiah, undermining the value of the latter further. In February 1998, President Suharto sackedBank Indonesia Governor J. Soedradjad Djiwandono, but this proved insufficient. Suharto resigned under public pressure in May 1998 and Vice President B. J. Habibie was elevated in his place. Before the crisis, the exchange rate between the rupiah and the dollar was roughly 2,600 rupiah to 1 USD.[21] The rate plunged to over 11,000 rupiah to 1 USD in January 1998, with spot rates over 14,000 during January 23–26 and trading again over 14,000 for about six weeks during June-July 1998. On December 31, 1998, the rate was almost exactly 8,000 to 1 USD.[22]Indonesia lost 13.5% of its GDP that year.
[edit]South Korea
Further information: Economy of South Korea
Macroeconomic fundamentals in South Korea were good but the banking sector was burdened with non-performing loans as its large corporations were funding aggressive expansions. During that time, there was a haste to build great conglomerates to compete on the world stage. Many businesses ultimately failed to ensure returns and profitability. The South Korean conglomerates, more or less completely controlled by the government, simply absorbed more and more capital investment. Eventually, excess debt led to major failures and takeovers. For example, in July 1997, South Korea's third-largest car maker, Kia Motors, asked for emergency loans. In the wake of the Asian market downturn, Moody's lowered the credit rating of South Korea from A1 to A3, on 28 November 1997, and downgraded again to B2 on 11 December. That contributed to a further decline in South Korean shares since stock markets were already bearish in November. The Seoul stock exchange fell by 4% on 7 November 1997. On 8 November, it plunged by 7%, its biggest one-day drop to that date. And on 24 November, stocks fell a further 7.2% on fears that the IMF would demand tough reforms. In 1998, Hyundai Motors took over Kia Motors. Samsung Motors' $5 billion dollar venture was dissolved due to the crisis, and eventually Daewoo Motors was sold to the American company General Motors(GM).
The South Korean won, meanwhile, weakened to more than 1,700 per dollar from around 800. Despite an initial sharp economic slowdown and numerous corporate bankruptcies, South Korea has managed to triple its per capita GDP in dollar terms since 1997. Indeed, it resumed its role as the world's fastest-growing economy—since 1960, per capita GDP has grown from $80 in nominal terms to more than $21,000 as of 2007. However, like the chaebol, South Korea's government did not escape unscathed. Its national debt-to-GDP ratio more than doubled (app. 13% to 30%) as a result of the crisis.
In South Korea, the crisis is also commonly referred to as the IMF crisis.

Afghanistan
A virtual guide to Afghanistan. This page aims to give you a broad overview of Afghanistan's art, culture, people, environment, geography, history, economy and government.
Beside a country profile with facts and figures, the page offers links to sources which provide you with all the information you need to know about this Southern Asian nation, e.g.: official web sites of Afghanistan, addresses of Afghan and foreign embassies, domestic airlines, country guides, maps, and local news from Afghanistan.







Islamic Republic of Afghanistan | Afghanestan


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Afghanistan's recent history is characterized by war and civil unrest. The Soviet Union invaded in 1979, but was forced to withdraw 10 years later by anti-Communist mujahidin forces supplied and trained by the US, Saudi Arabia, Pakistan, and others.
Fighting subsequently continued among the various mujahidin factions, giving rise to a state of warlordism that eventually spawned the Taliban.
Backed by foreign sponsors, the Taliban developed as a political force and eventually seized power. The Taliban were able to capture most of the country, aside from Northern Alliance strongholds primarily in the northeast, until US and allied military action in support of the opposition following the 11 September 2001 terrorist attacks forced the group's downfall. In late 2001, major leaders from the Afghan opposition groups and diaspora met in Bonn, Germany, and agreed on a plan for the formulation of a new government structure that resulted in the inauguration of Hamid KARZAI as Chairman of the Afghan Interim Authority (AIA) on 22 December 2001.
The AIA held a nationwide Loya Jirga (Grand Assembly) in June 2002, and KARZAI was elected President by secret ballot of the Transitional Islamic State of Afghanistan (TISA). The Transitional Authority has an 18-month mandate to hold a nationwide Loya Jirga to adopt a constitution and a 24-month mandate to hold nationwide elections. In December 2002, the TISA marked the one-year anniversary of the fall of the Taliban.
In addition to occasionally violent political jockeying and ongoing military action to root out remaining terrorists and Taliban elements, the country suffers from enormous poverty, a crumbling infrastructure, and widespread land mines.
(Source: CIA - The World Factbook)

border countries: China, Iran, Pakistan, Tajikistan, Turkmenistan, Uzbekistan

Albania
A virtual guide to Albania. Get an overview of Albania's art, culture, people, environment, geography, history, economy and its government.
Beside a country profile with facts and figures, this page offers maps, statistics, weather information, and links to sources that provide you with information about this Southwestern European nation, e.g.: official web sites of Albania, addresses of Albania`s and foreign embassies, domestic airlines, local news, city- and country guides with extensive travel and tourism information on accommodation, tourist attractions, events and more.
Republic of Albania | Shqipëria


Flag of Albania

Background:
In 1990 Albania ended 44 years of xenophobic communist rule and established a multiparty democracy. The transition has proven difficult as corrupt governments have tried to deal with high unemployment, a dilapidated infrastructure, widespread gangsterism, and disruptive political opponents. International observers judged local elections in 2000 to be acceptable and a step toward democratic development, but serious deficiencies remain to be corrected before the the 2001 parliamentary elections.
(Source: CIA - The World Factbook)

border countries: Greece, Macedonia, Rep. of, Montenegro, Serbia




Algeria
Destination Algeria, this page is about many aspects of Algeria. Here you will find comprehensive information about Algeria in its diversity: geography, economy, science, people, culture, environment, government and history.
You will have access to newspapers from Algeria and you will find travel and tourism information for Algeria.



People's Democratic Republic of Algeria | Al Jaza'ir


Flag of Algeria


al Jaza'ir



Background:
Algeria is Africa's second largest country, covering an area of nearly 2.5 million square miles. Algeria's indigenous Berber people has been under foreign rule for much of the last 3000 years. The Phoenicians (1000 BC) and the Romans (200 BC) were the most important of these. With the incursion of Muslim Arabs in the 7th-8th century into the region, Islamic influence came to the Berbers and almost a millenium of domination by Arab dynasties.
In the beginning of the 16th century the region was placed under protection of the ottoman Sultan of Istanbul, followed by reigns of ottoman beys, pachas, and aghas, brought to an end with the beginning of the French colonization in 1830. The French occupation condemned Algeria's population to economic, social and political inferiority and caused an armed resistance lasting for decades. After a century of rule by France, Algeria became independent in 1962 and Arabic became official language - with a little help of Quran teachers from Egypt and Saudi Arabia.
Since then le pouvoir ("the power"), an elite of business leaders and generals behind a democratic façade has run Algeria.

Algeria is a member state of the League of Arab States
border countries: Libya, Mali, Mauritania, Morocco, Niger, Tunisia
related countries: France

American Samoa
Destination American Samoa, this page is about many aspects of the archipelago. Here you will find comprehensive information about American Samoa in its diversity: geography, economy, science, people, culture, environment, government and history.
You will have access to newspapers from American Samoa and you will find extensive travel and tourism information for American Samoa.
American Samoa - Dependency of the USA


Flag of American Samoa

Background:
American Samoa is a small archipelago in the South Pacific Ocean and is comprised of five volcanic islands (Tutuila, Ta'u, Ofu, Olosega, Aunu'u, Nu'utele) and two coral atolls (Swain's and Rose Islands). Tutuila contains about two thirds of the total area and is home to 95% of the 64 000 islanders.
In the time of 1000 B.C. Southeast Asian immmigrants arrived in the Samoan islands and from there they settled the rest of Polynesia.
First sparsely contacts with Europeans began in the early 1700s, intensified with the arrival of English missionaries and traders in the 1830s.
International rivalries had been settled by the Treaty of Berlin in 1899 in which Germany and the US divided the Samoan archipelago. The US formally occupied its portion.
Despite of modern influences Samoan people still hold firmly to "Fa'asamoa", the traditional Samoan way, related to their language, dress, food, customs and even property.

related countries: Samoa, New Zealand, USA

other Polynesian islands: Cook Islands, French Polynesia (Tahiti), Niue, Pitcairn, Samoa, Tonga, Tuvalu



Andorra
keywords: Andorra information, Andorra news papers, tourist information for Andorra, Andorra map
Principality of Andorra | Principat d'Andorra
Country Profile


Flag of Andorra

Background:
Long isolated and impoverished, mountainous Andorra has achieved considerable prosperity since World War II through its tourist industry. Many immigrants (legal and illegal) are attracted to the thriving economy with its lack of income taxes.Long isolated and impoverished, mountainous Andorra has achieved considerable prosperity since World War II through its tourist industry. Many immigrants (legal and illegal) are attracted to the thriving economy with its lack of income taxes. .
(Source: CIA - The World Factbook)

border countries: France, Spain

Angola


A virtual guide to Angola. This page aims to give you a broad overview of Angolan art, culture, people, environment, geography, history, economy and government.
Beside a country profile this page contains links to sources that will provide you with in-depth information about this South African nation, e.g.: official web sites of Angola, addresses of Angolan and foreign embassies, domestic airlines, city- and country guides with extensive travel and tourism information on accommodation, tourist attractions, events and more like weather information, maps, statistics and local newspapers from Angola.
Republic of Angola | República de Angola
Country Profile


Flag of Angola

Background:
Civil war has been the norm in Angola since independence from Portugal in 1975. A 1994 peace accord between the government and the National Union for the Total Independence of Angola (UNITA) provided for the integration of former UNITA insurgents into the government and armed forces. A national unity government was installed in April of 1997, but serious fighting resumed in late 1998, rendering hundreds of thousands of people homeless. Up to 1.5 million lives may have been lost in fighting over the past quarter century. The death of Jonas SAVIMBI and a cease fire with UNITA may bode well for the country. .
(Source: CIA - The World Factbook)

border countries: Democratic Republic of the Congo (former Zaire), Republic of the Congo, Namibia, Zambia

related countries: Portugal

Anguilla
Destination Anguilla, a virtual travel guide to the island in the British West Indies. This page aims to give you a broad overview of Anguilla's art, culture, people, environment, geography, history, economy and government.
Beside a country profile with facts and figures, the page contains links to sources which provide you with all the information you need to know about this Caribbean island, e.g.: official web sites of Anguilla, domestic airlines, city- and country guides with extensive travel and tourism information on accommodation, tourist attractions, events and more like Anguilla weather information, maps, statistics and local newspapers.
Anguilla Sovereignty: United Kingdom
Country Profile


Flag of Anguilla

Background:
Originally inhabited by Arawak and Carib peoples, Anguilla became a British colony after English settlers arrived in 1650. Its people are of mainly African descent.
Anguilla, as the first in the chain of the Leeward islands, is located in the Eastern Caribbean, east of Puerto Rico and the Virgin Islands.
It is only a few minutes by air from the major international airport of St. Maarten and is serviced by regular flights from the other international Caribbean gateways of Antigua and Puerto Rico. Anguilla's location, and its reputation as a friendly and virtually crime free society, has enabled it to establish itself as a high end tourist destination.



related countries: UK,
British Virgin Islands, Puerto Rico, Saint Kitts and Nevis, U.S. Virgin Islands

Antigua and Barbuda
Destination Antigua and Barbuda, a virtual travel guide to Antigua, Barbuda, and Redonda. This page aims to give you an overview of Antigua and Barbuda's art, culture, people, environment, geography, history, economy and government.
Beside a country profile with facts and figures, the page contains links to sources which provide you with all the information you need to know about this Caribbean island nation, e.g.: official web sites of Antigua and Barbuda, country guides with extensive travel and tourism information on accommodation, tourist attractions, events and more like weather information, maps, statistics and local newspapers from Antigua and Barbuda.



Antigua and Barbuda
Country Profile


Flag of Antigua and Barbuda

Background:
Antigua, Barbuda, and Redonda form the independent nation of Antigua and Barbuda, within the Commonwealth of Nations.
They are part of the Leeward Islands in the West Indies. The island nation located in the eastern Caribbean Sea was populated by Amerindian tribes when Christopher Columbus "discovered" it in 1493. He named the island "Santa Maria de la Antigua".
Settlements by the Spanish and French were succeeded by the English who formed a colony in 1667. They established slavery to run the sugar plantations on Antigua.
Antigua and Barbuda became an independent nation in 1981, but it is still British in many of its traditions.



Neighboring island states: Montserrat, Saint Kitts and Nevis
Related countries: UK

World is a highly common name for the planet Earth, but it was originally used to mean the sum of human civilization living on it, specifically human experience, history, or the 'human condition' in general.[2]
In a metaphysical context, World may refer to the Universe, everything that constitutes reality: see World (philosophy).
Some authors, such as Carl Sagan, use the term worlds to refer to planets and moons collectively.
Contents
[hide]
• 1 Etymology
• 2 Usage
• 3 Earth
• 4 Humanity
• 5 Development
• 6 See also
• 7 References
• 8 External links

[edit]Etymology
In English, the etymology of world may be a compound of the obsolete words like a compound of elements for example were meaning man and eld meaning age; thus, its etymology would be semantically rendered as "age or life of man".[3] Compare to the word for "world" in a closely related language to English, Dutch, which is "wereld" and German which is "Welt", but itself a shortening of weralt (wer and alt) [4]
[edit]Usage
'World' distinguishes the entire planet or population from any particular country or region: world affairs are those which pertain not just to one place but to the whole world, and world history is a field of history which examines events from a global (rather than a national or a regional) perspective. Earth, on the other hand, refers to the planet as a physical entity, and distinguishes it from other planets and physical objects.
'World' can also be used attributively, as an adjective, to mean 'global', 'relating to the whole world', forming usages such as World community. See World (adjective). Or the body of humanity, as in the original meaning.
By extension, a 'world' may refer to any planet or heavenly body, especially when it is thought of as inhabited.
'World', in its original sense, when qualified, can also refer to a particular domain of human experience.
 The world of work describes paid work and the pursuit of a career, in all its social aspects, to distinguish it from home life and academicstudy.
 The fashion world describes the environment of the designers, fashion houses and consumers that make up the fashion industry.
 The New World is a part of the world discovered or colonized by Europeans later than other parts; it usually refers to the Americancontinents or to Australia. Native Americans and Native Australians tend to dislike this usage because it implies that their pre-Columbian ancestors were not valid parts of the world. The Old World refers, by contrast, to the continents of Europe, Asia and north Africa.
 "World of hurt."
[edit]Earth
Main article: Earth
Earth is the only place in the universe where life is known by humanity to exist at this time. Most scientific evidence indicates that the planet formed 4.6 billion years ago,[5][6][7][8] and life appeared on its surface within a billion years. Since then, Earth's biosphere has significantly altered the atmosphere and other abiotic conditions on the planet, enabling the proliferation of aerobic organisms as well as the formation of theozone layer which, together with Earth's magnetic field, blocks harmful radiation, permitting life on land.[9]
Earth's outer surface is divided into several rigid segments, or tectonic plates, that gradually migrate across the surface over periods of many millions of years. About 71% of the surface is covered with salt-water oceans, the remainder consisting of continents and islands; liquid water, necessary for all known life, is not known to exist on any other planet's surface.[10][11] Earth's interior remains active, with a thick layer of relatively solid mantle, a liquid outer core that generates a magnetic field, and a solid iron inner core.
The earth consists of seven continents listed as follows: North America, South America, Antarctica, Africa, Europe, Asia and Australia; the largest of which is Asia. There are several other methods of determining the continents.
Earth is impacted upon by other objects in outer space, including the Sun and the Moon. At present, Earth orbits the Sun once for every roughly 365.26 times it rotates about its axis. This length of time is a sidereal year, which is equal to 365.26 solar days.[12] The Earth's axis of rotation is tilted 23.4° away from the perpendicular to its orbital plane,[13] producing seasonal variations on the planet's surface with a period of one tropical year (365.24 solar days). Earth's only known natural satellite, the Moon, which began orbiting it about 4.53 billion years ago, provides ocean tides, stabilizes the axial tilt and gradually slows the planet's rotation. A cometary bombardment during the early history of the planet played a role in the formation of the oceans.[14] Later, asteroid impacts caused significant changes to the surface environment.
[edit]Humanity
Further information: Human and World population
Humans are bipedal primates belonging to the mammalian species Homo sapiens. Compared to other animals, humans have a relatively highly developed brain capable of abstract reasoning, language, and introspection. This mental capability, combined with an erect body carriage that frees their upper limbs for manipulating objects, has allowed humans to make far greater use of tools than any other species. DNA evidence indicates that modern humans originated in Africa about 200,000 years ago.[15] Humans now inhabit every continent and low Earth orbit, with a total population of over 6.73 billion humans as of January 2009.[16]
Like most primates, humans are social by nature. However, humans are particularly adept at utilizing systems of communication for self-expression, the exchange of ideas, and organization. Humans create complex social structures composed of many cooperating and competing groups, from families to nations. Social interactions between humans have established an extremely wide variety of traditions, rituals, ethics, values, social norms, and laws which form the basis of human society. Humans have a marked appreciation for beauty and aesthetics which, combined with the human desire for self-expression, has led to cultural innovations such as art, literature and music.
Humans are noted for their desire to understand and influence the world around them, seeking to explain and manipulate natural phenomena through science, philosophy, mythology and religion. This natural curiosity has led to the development of advanced tools and skills.
[edit]Development
A summary of world development:
 The universe is continuing its metric expansion.
 Our galaxy is approaching its neighbor.
 The Sun is shining brighter and brighter.
 Species are becoming fewer.
 Humans are increasing in number.
 Human life expectancy, literacy, education, standard of living, and GDP per capita are increasing.
 Technology and socioculture are also developing.


A
Afghanistan
Albania
Algeria
American Samoa

Andorra
Angola
Anguilla
Antarctica

Antigua and Barbuda
Argentina
Armenia
Aruba

Australia
Austria
Azerbaijan






B
Bahamas
Bahrain
Bangladesh
Barbados

Belarus
Belgium
Belize
Benin

Bermuda
Bhutan
Bolivia
Bosnia and Herzegovina

Botswana
Brazil
Brunei
Bulgaria

Burkina Faso
Burma (Myanmar)
Burundi







C
Cambodia
Cameroon
Canada
Cape Verde

Cayman Islands
Central African Republic
Chad
Chile

China
Christmas Island
Cocos Islands
Colombia

Comoros
Congo-Brazzaville
Congo- Kinshasa
Cook Islands

Costa Rica
Cote d'Ivoire (Ivory Coast)
Croatia
Cuba

Cyprus
Czech Republic

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News articles
Cloward-Piven Strategy - legislation to destroy the free market
Examiner.com
- Nov 05, 2009
- 2 minutes ago
The answer may be found in the Cloward-Piven Strategy. Set forth in the May 2, 1966 issue of The Nation magazine, two Columbia University professors, ...
clipped from Google - 10/2009
Sound off! (Nov. 4)
Silver City Sun News
- Nov 04, 2009
- 2 minutes ago
The Cloward-Piven Strategy was but one of many ideas coming out of the civil unrest of the 1960s. Organizing the disenfranchised ' not causing chaos of the ...
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Obama's Orchestrated Crisis
Greek American News Agency
- Nov 01, 2009
- 2 minutes ago
It's called the Cloward-Piven Strategy of orchestrated crisis. It's an approach to radical social and political change articulated by Marxist university ...
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From the Pen of David Horowitz: October 30, 2009
David Horowitz's NewsReal Blog (blog)
- Oct 30, 2009
- 2 minutes ago
Their formula even bore their names: the Cloward-Piven strategy.On August 11, 1965, the black district of Watts in Los Angeles exploded in violence when ...
clipped from Google - 10/2009
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Blog posts
Cloward and Piven Strategy
21 hours ago
The Cloward and Piven strategy was first put forward by Richard Andrew Cloward and Frances Fox Piven. The strategy was based upon the concept of full.
http://www.makli.com/
cloward and piven » cloward and piven strategy, cloward piven ...
Nov 3, 2009
Arguing about Cloward And Piven Strategy US Government And Congress right now arguing about strategy to relief their country from crisis, some people said.
http://deconlabel.com/
Cloward and Piven Strategy
22 hours ago
The Cloward–Piven strategy, a political strategy developed by Frances Fox Piven and Richard Cloward. Both were political activists and socialists at School.
http://www.khurak.net/
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Web results
Cloward–Piven strategy - Wikipedia, the free encyclopedia
The Cloward–Piven strategy is a political strategy outlined by Richard Cloward and Frances Fox Piven, then both sociologists and political activists at the ...
en.wikipedia.org
en.wikipedia.org/wiki/Cloward%E2%80%93Piven_strategy
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American Thinker: The Cloward/Piven Strategy of Economic Recovery
Feb 7, 2009 ... The Cloward/Piven Strategy is another method employed by the radical Left to create and manage crisis. This strategy explains Rahm Emanuel's ...
www.americanthinker.com
www.americanthinker.com/2009/02/the_clowardpiven_strategy_of_e.html
clipped from Google - 10/2009
Cloward-Piven Strategy - Discover the Networks
First proposed in 1966 and named after Columbia University sociologists Richard Andrew Cloward and Frances Fox Piven, the “Cloward-Piven Strategy” seeks to ...
www.discoverthenetworks.org
www.discoverthenetworks.org/groupProfile.asp?grpid=6967
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cloward
The Cloward-Piven Strategy to implement socialist revolution ... The Cloward- Piven strategy never achieved its goal of system breakdown and a Marxist utopia ...
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World Series 2009 Game 6 to End or Extend Series
Associated Content
- Nov 05, 2009
- 2 minutes ago
The World Series 2009 Game 6 has New York ready for a party. However, the World Series 2009 Game 6 also has Yankees fans nervous. The World Series 2009 Game ...
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Phillies vs Yankees Game 6 World Series 2009 Predictions & Picks
Sports-Odds.com
- Nov 05, 2009
- 2 minutes ago
Going into tonight's World Series 2009 Game 6, Rivera has already made 11 postseason appearances in the playoffs. In the process, Mo has limited opponents ...
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Game 6 memories: First-hand accounts
MLB.com
- Nov 05, 2009
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With the Yankees and Phillies squaring off for Game 6 of the 2009 World Series, MLB.com reached out to key figures from each of those Game 6 classics, ...
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Game 6 - 2009 World Series - New York Yankees vs Philadelphia Phillies
The Star-Ledger - NJ.com
- Nov 05, 2009
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... Utley to end the 1st inning of World Series game 6 between the New York Yankees and the Philadelphia Phillies at Yankee Stadium in Bronx, NY on 11/4/09. ...
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Patterico's Pontifications » World Series 2009, Game 6
4 hours ago
World Series 2009, Game 6. Filed under: Sports — DRJ @ 5:44 pm. [Guest post by DRJ]. N.Y.'s Andy Pettitte vs. Philly's Pedro Martinez. The Yankees are up 2-0 in the top of the third and are one win away from their 27th Series title. ...
http://patterico.com/
World Series 2009: Game 6 Time and Predictions : In Entertainment
9 hours ago
Sportsbook.com Phillies vs Yankees Game 6 World Series Predictions 2009: Philadelphia Phillies +1.5 (-105), Over 9 (-120), +185 (Moneyline) New York Yankees -1.5 (-115), Under 9 (+100), -200 (Moneyline). Source: Point-Spreads.com ...
http://www.inentertainment.co.uk/
World Series 2009 Game 6,World Series Game 6 2009 | TheNewsPk
10 hours ago
World Series 2009 Game 6,World Series Game 6 2009: is the biggest game of the year so far. So for the World Series 2009 Game 6, two big game legends are leading.
http://www.thenewspk.com/
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World Series | MLB.com: World Series
It's not too early to get great 2009 World Series gear from the MLB.com Shop. ... WS 2009 Gm 6: MLB.com previews Pedro's Game 6 start ...
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World Series 2009 Game 6
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World Series 2009 Game 6 Pits Two Legends Together - Associated ...
Nov 4, 2009 ... Pedro Martinez and Andy Pettitte are among the best big game pitchers of the last 15 years. Tonight, they take center stage for Game 6, ...
www.associatedcontent.com
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2009 World Series: Game 6 - Red Reporter
Nov 4, 2009 ... This is the 4th Game 6 in the World Series in the last 10 years. The Yankees were involved in 2 of the previous 3, losing both games - one ...
www.redreporter.com
www.redreporter.com/2009/11/4/1115059/2009-world-series-game-6
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