RE: FW: urgent question (and more)

> -----Original Message-----
> From: Mine Aysen Doyran [mailto:mine25.1@netzero.net]
> Sent: Tuesday, January 09, 2001 2:59 PM
> To: Boles (office); wsn@csf.colorado.edu
> Subject: Re: FW: urgent question (and more)
>
> > >Soros may correctly judge that the limits to those capital
> flows have >been
> > >reached for a time.  Which is why he supposes things must get
> worse >before
> > >they get better, i.e. there must be more deflationary chaos in
> the (semi)
> > >periphery so core capital can go back to purchase (invest) at
> lower >prices.
>
> Elson, where does Soros imply this? which part of his book? I
> assume you are
> talking about _The crisis of Global Capitalim: Open Society Engendered_?
>
> mercissss..
>
> Mine

I gathered this from the quotes in the January 2 article such as these:

"But I am much more worried about the consequences on the edge of the system
because this edge has been weakened because of the 1997-1998 crisis, and I
believe will have more serious repercussions in distant regions, such as
southeast Asia,"

The last crisis was the product of a boom of investments in emerging
markets, followed by a very steep fall. Now the problem that the world faces
is inadequate capital flows from countries at the center to countries on the
periphery.

"It is going to be a chronic, not a temporary crisis, and I believe it is
already underway," Soros predicted.

"I think Argentina has to pass through an adjustment process that is going
to be painful. Eventually it will emerge, as long as there is no fall in the
global economy."

I believe that it is not just Argentina, but many semiperipheries that will
continue to face greater difficulties over the next five years.  It may be
that Argentina actually has a more stable financial system than many East
Asian countries, but will not, as he notes, "recovery" to the same degree
because, I think, Argentina is not quite as competitive in the world-economy
as those East Asian NICs, such as China (which now produces most of the
world's shoes, I read somewhere).  So, capital will begin flowing there in
greater quantities when the recovery starts.