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basiltherat
Joined: 04 Oct 2003
Posts: 952
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 Posted: Tue May 08, 2007 5:10 pm Post subject: |
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i was in jakarta wen the brown stuff hit the fan in 1998. All I can say is that it hurt the majority of people VERY hard.
Property values plummeted, salaries / buying power both in real terms and exchange-rate terms fell through the earth's crust.
Salaries (buying power) for the tefl gig, in most cases, have nowhere near adjusted to the crash 9 years ago; in fact if u visit the indonesia forum yul see some jobs the salaries for which have risen negligbly meanwhile prices have rocketed.
i think it was something like 3000 rupiah to the dollar prior to the crash and it now stands at somewhere around 9000 having topped at something like 12000 during the debacle. A 'good' salary prior to the mess was circa 4 million i think.
Property prices are coming back but very slowly. Example, our property which we bought in 1987 has only recently returned to its pre-debacle dollar value.
I wouldnt like to be dealing in / holding large sums of Rupiah at the moment despite the dollar's weakness.
best
basil  |
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Serious_Fun
Joined: 28 Jun 2005
Posts: 1171
Location: terra incognita
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| Posted: Thu Aug 16, 2007 10:46 am Post subject: |
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william wallace
Joined: 14 May 2003
Posts: 2869
Location: in between
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| Posted: Thu Aug 16, 2007 4:17 pm Post subject: |
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| Yeah...I think it's coming ,but from China,and it'll be more serious than 97. We're good till the Olympics are over. |
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globalnomad2
Joined: 23 Jul 2005
Posts: 562
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| Posted: Fri Aug 17, 2007 2:02 pm Post subject: |
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On that note about China, here's something I posted elsewhere..
Certainly greed gone bad, and a case of so many convoluted and complicated ways to extend loans to everyone.
But greed only in the U.S.? And only the US has all these bad effects on the rest of the world, who are all angels?
Personally I am fed up with Chinese exports. Read a few books about the Chinese economy and how it really works and you'll see that it's highly disorganized, unregulated and everyone's a crook. Recently,
* I had to worry about my cat back in the States because thousands of pets died due to Chinese poison chemical additives
* Deadly Chinese toothpaste in Central America and elsewhere
* All the houshold lamps in the UAE, at least in RAK, are made in China and I've gone through 7 of them in two years...they all blow out, some of them within two days.
* The lead paint on toys. One kid has died from it in the U.S. already. (He swallowed some small item that had lead paint on it.)
There's more but enough said. If these massive recalls of Chinese products continue, there could be major consequences for the world economy. Chinese stocks could dive like a kamikaze and set off a domino effect, just to name one possibility.
Here's how Chinese manufacturing capitalism works: Western investors transfer money to a Chinese bank and have their Western specialists in China find things to invest in. They scour the country for suitable factories (or whatever) with a modern standard (very hard to find actually). They find a Chinese super go-getter, a regular Chinese Donald Trump or Bill Gates, to run things. Later, Mr. Supercharged siphons all the profits into building his own, secret factory. Investors back in the West wonder where the hell the profits are if the original factories seem to be humming along so well thanks to Mr. Wonderful. A half-billion dollars in original investment vanishes into the black hole of inscrutable local greed. (Nah, I'm not racist...my wife is Chinese. She's the first one who told me the Chinese are all crooks
A different type of greed, that's all. |
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Sgt Killjoy
Joined: 26 Jun 2004
Posts: 438
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| Posted: Sun Aug 19, 2007 2:43 pm Post subject: |
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It depends.....A US recession is inevitable. The Federal Reserve Bank has just lowered the discount rate and now allows Banks to borrow directly from them for up to 30 days because bank to bank lending was beginning to dry up.
Liquidity Problem
So a US recession, what happens in Asia? I don't think we are heading for a crash, a recession for Asia, probably, but not a crash and/or meltdown. And if it's just a recession, it will be ok for us teachers since in recessions, many people take the opportunity to upgrade their skills(including English education). |
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SnoopBot
Joined: 21 Jun 2007
Posts: 740
Location: USA
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| Posted: Wed Oct 03, 2007 3:59 pm Post subject: Re: Great |
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| durian wrote: |
| When I was doing my MA TESOL at San Jose State, my professors told me that when economies go bad people return to school. They need to be more competitive and so will invest in that through further training/education. I believe the students will continue to be there, but it may flood the ESL market with laid-off workers??? |
This is quite true, many return to school for new careers or to become more competitive in the job market.
During a GOOD economic period- Many return to school to learn the new skills needed for their career or higher paying position.
So Good or Bad growth still is a factor.
I feel, there might be a flood of new ESL teachers due to the number of recruiters and fraud schemes designed to prey on the under-employed or unemployed. You can see this right now in some advertisements that state , "No degree, No Experience, No Problem."
I feel those of us with a MA, Med in TESOL will still be in demand. The McMills will have a better selection pool and maybe will up their requirements a bit due to the new influx of job seekers.
For an Asian crisis, I'm reading and watching a situation in Europe, many European banks were involved in the Sub-Prime fiasco and have lost a lot of money. The so-called experts are stating a triple-whammy might occur.
1. A depression-styled run on certain European banks
2. Failure and severe recession in the USA (my state is in a recession now)
3. A Chinese crash due to a failure in the export driven economy.
These things can happen based on various scenarios from an Israeli-Iran strike (+$100 a barrel of oil price) to a housing collapse in the USA.
As for the housing collapse . some are getting very good deals on house prices right now. The key problem would be some type of credit crunch fall-out and the inability to use interest rates to stop it. I see the days of Carter- 1976-79 coming back. During these days we had high oil prices, and double digit inflation with loss of jobs. This period of time was the time I graduated from high school. It was terrible, many of us couldn't get loans for our college tuition rates, couldn't find a job, and couldn't afford anything except the basics.
40% of 256 High School Seniors of the class of 79, ended up joining the US military to escape the Rust Belt life of the American Midwest. |
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SnoopBot
Joined: 21 Jun 2007
Posts: 740
Location: USA
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| Posted: Wed Oct 03, 2007 4:17 pm Post subject: |
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| globalnomad2 wrote: |
On that note about China, here's something I posted elsewhere..
Certainly greed gone bad, and a case of so many convoluted and complicated ways to extend loans to everyone.
But greed only in the U.S.? And only the US has all these bad effects on the rest of the world, who are all angels?
Personally I am fed up with Chinese exports. Read a few books about the Chinese economy and how it really works and you'll see that it's highly disorganized, unregulated and everyone's a crook. Recently,
* I had to worry about my cat back in the States because thousands of pets died due to Chinese poison chemical additives
* Deadly Chinese toothpaste in Central America and elsewhere
* All the houshold lamps in the UAE, at least in RAK, are made in China and I've gone through 7 of them in two years...they all blow out, some of them within two days.
* The lead paint on toys. One kid has died from it in the U.S. already. (He swallowed some small item that had lead paint on it.)
There's more but enough said. If these massive recalls of Chinese products continue, there could be major consequences for the world economy. Chinese stocks could dive like a kamikaze and set off a domino effect, just to name one possibility.
Here's how Chinese manufacturing capitalism works: Western investors transfer money to a Chinese bank and have their Western specialists in China find things to invest in. They scour the country for suitable factories (or whatever) with a modern standard (very hard to find actually). They find a Chinese super go-getter, a regular Chinese Donald Trump or Bill Gates, to run things. Later, Mr. Supercharged siphons all the profits into building his own, secret factory. Investors back in the West wonder where the hell the profits are if the original factories seem to be humming along so well thanks to Mr. Wonderful. A half-billion dollars in original investment vanishes into the black hole of inscrutable local greed. (Nah, I'm not racist...my wife is Chinese. She's the first one who told me the Chinese are all crooks
A different type of greed, that's all. |
You sure hit it on the nail with this post. This is exactly what is happening. |
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Serious_Fun
Joined: 28 Jun 2005
Posts: 1171
Location: terra incognita
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| Posted: Mon Nov 26, 2007 11:54 am Post subject: |
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"Chinese authorities are slamming the brakes on bank lending, in their latest attempt to curb the runaway investment threatening to overheat what is soon to be the world's third-largest economy. In recent weeks, regulators have quietly ordered China's commercial banks to freeze lending through the end of the year, according to bankers in several cities. The bankers say that to comply, they are canceling loans and credit lines with businesses and individuals." ("China freezes lending to Curb Investing Frenzy" Wall Street Journal)
The move illustrates how concerned the Chinese are that a slowdown in US consumer spending will trigger a crash on the Shanghai stock market. It also shows that the Chinese are having difficulty dealing with the inflation generated by the hundreds of billions of US dollars absorbed via the trade imbalance with the US. China is awash in USDs and that surplus is causing a steady rise in food and energy costs. This could be mitigated by allowing their currency to "float" freely. But a sudden, steep increase in the Chinese yuan's value could also send the world headlong into a global recession. For now, the lending freeze and price fixing appear to be the way out. |
http://www.counterpunch.org/whitney11242007.html
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"It is increasingly clear by now that a severe U.S. recession is inevitable in next few months...I now see the risk of a severe and worsening liquidity and credit crunch leading to a generalized meltdown of the financial system of a severity and magnitude like we have never observed before. In this extreme scenario whose likelihood is increasing we could see a generalized run on some banks; and runs on a couple of weaker (non-bank) broker dealers that may go bankrupt with severe and systemic ripple effects on a mass of highly leveraged derivative instruments that will lead to a seizure of the derivatives markets... massive losses on money market funds with a run on both those sponsored by banks and those not sponsored by banks; ..ever growing defaults and losses ($500 billion plus) in subprime, near prime and prime mortgages with severe knock-on effect on the RMBS and CDOs market; massive losses in consumer credit (auto loans, credit cards); severe problems and losses in commercial real estate...; the drying up of liquidity and credit in a variety of asset backed securities putting the entire model of securitization at risk; runs on hedge funds and other financial institutions that do not have access to the Fed's lender of last resort support; a sharp increase in corporate defaults and credit spreads; and a massive process of re-intermediation into the banking system of activities that were until now altogether securitized." (Nouriel Roubini's Global EconoMonitor)
"A generalized meltdown of the financial system". |
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Serious_Fun
Joined: 28 Jun 2005
Posts: 1171
Location: terra incognita
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Serious_Fun
Joined: 28 Jun 2005
Posts: 1171
Location: terra incognita
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| Posted: Mon Mar 17, 2008 9:28 am Post subject: |
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An optimistic article, no doubt written before the recent meltdown/implosion of Bear Stearns in the trainwreck known as the "US economy":
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article3564041.ece
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US slump may affect Asia, HSBC chief Sandy Flockhart warns Christine Seib
Asia has weathered the financial turmoil embroiling the West with only small signs of distress, the chief executive of HSBC Asia believes, but a full-scale recession in the United States would have a knock-on effect on Asia, regardless of arguments that the region had �decoupled� from America.
Sandy Flockhart, who runs the Hongkong and Shanghai Banking Corporation Limited, said that HSBC, the largest foreign bank in Asia, was watching carefully for signs of contagion from turbulent markets in the US and Europe. So far, there were few distress signals, he told The Times.
Mr Flockhart is the second prominent British business figure in Asia to speak out about the region's ability to withstand the downturn in the West. Mark Tucker, the chief executive of Prudential, the largest European insurer in Asia, writes in The Times today that decoupling is a recent economic fashion.
The decoupling theory holds that an emerging market economy can become sufficiently sophisticated that it no longer depends on the US, the world's largest economy, for growth.
Mr Flockhart agreed that Asia had its own characteristics that made drawing parallels with the West difficult. For example, he said that Asian countries with rising inflation had less ability to cut interest rates than the US. Also, he said, consumer debt levels were far lower than in the US or Europe.
Mr Flockhart said: �Last year Asia came through pretty unscathed from the fallout of the collateral damage from US sub-prime ... but if the US, which accounts for 30 per cent of the world's consumption, has a long and extended period of slow growth, then it's going to affect Asia.� He added that �from a risk perspective and a growth perspective, we're always looking for softness or credit quality deterioration ... There are short-term indicators, inventories are being kept much tighter, but consumption and overall credit quality remain OK�.
In the six months before Hong Kong was handed back to China in 1997, property prices in the territory rose 30 per cent. The bubble burst and over the following five years there was a downturn in the housing market. Mr Flockhart said, however, that the conservative nature of the Hong Kong mortgage market meant that it posed little danger to HSBC, even if an American recession spread to Asia.
Mortgage loans-to-value on houses in Hong Kong was between 40 per cent and 70 per cent, he said, compared to up to 110 per cent in the UK, and the average mortgage was paid off within five years.
�Hong Kong did go through a period of negative valuations on property, but it didn't lead to large-scale defaults,� Mr Flockhart said. �At present, the property market looks pretty stable.� |
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Serious_Fun
Joined: 28 Jun 2005
Posts: 1171
Location: terra incognita
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| Posted: Wed Sep 24, 2008 11:29 am Post subject: |
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http://www.atimes.com/atimes/Global_Economy/JI23Dj03.html
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| Will the Chinese people, with their economy slowing and their urban population now used to a rapidly rising standing of living, object to the nation's treasure being frittered away, essentially to be used as kindling in American backyard suburban barbecue pits? |
http://www.atimes.com/atimes/China_Business/JI25Cb01.html
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The party is pretty much over for China's Hu Jintao-Wen Jiabao leadership. After the coming-out extravaganza of the Beijing Olympics, the Chinese Communist Party (CCP) hoped to extend the festive mood through to late September for the launch of the country's third manned space flight, the Shenzhou VII, and then the week-long October 1 National Day celebrations.
Yet the Politburo under President Hu and Premier Wen will have to face the music during the third plenary session of the CCP Central Committee (CCPCC), which is due immediately after the National Day festivities. The Hu-Wen team's worst headache could come from CCPCC members from the regions, who will be lobbying aggressively for Beijing to loosen its tight monetary policy as well as to boost transfer payments and preferential policies for provinces and cities hard hit by economic doldrums, such as the closure of medium-sized factories and falling property prices. |
| Quote: |
| There is even speculation that the Hu-Wen leadership may fire a senior minister to placate the anger of millions of Chinese whose fortunes have declined the past year. People's Bank of China governor Zhou Xiaochuan, who sets the country's monetary policy, is expected to be transferred... |
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Serious_Fun
Joined: 28 Jun 2005
Posts: 1171
Location: terra incognita
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| Posted: Wed Sep 24, 2008 11:41 am Post subject: |
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http://www.telegraph.co.uk/finance/businesslatestnews/3068386/SocGen-issues-China-alert-as-fears-mount-on-banks.html
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SocGen issues China alert as fears mount on banks
Soci�t� G�n�rale has advised clients to dump shares of banks exposed to the Far East.
By Ambrose Evans-Pritchard
23 Sep 2008
"The collapse of emerging market economies will shake investors to the core. The great unwind has only just begun," said Albert Edwards, the bank's global strategist.
"The big surprise in store is what could happen in China. The potential for a deep recession in the US is already on the radar screen, but people will be stunned if China's economy contracts, as I believe it will. Investors could be massively caught out," he said.
"The consensus has a touching belief that emerging markets will prove resilient despite a deep downturn in developed economies. My view is that an outright contraction in global GDP is entirely possible next year."
"The emerging market boom is totally tied up with a decade of ballooning current account deficits in the US. Put that into reverse and you'll be surprised what pops out of the woodwork."
Mr Edwards said the vast accumulation of foreign exchange reserves � led by China with $1.8 trillion � had provided the "rocket fuel" of liquidity for frontier markets. This virtuous circle has now turned vicious as America tightens its belt. Countries in Asia and Latin America are intervening to prop up their currencies, causing reserves to fall.
"We could see monthly trade surpluses in the US within a year. The emerging market liquidity squeeze will intensify ferociously, and assets linked to the region will become toxic waste. That includes previously resilient banks such as HSBC, Standard Chartered and Banco Santander," he said.
The gloomy forecast comes as Fitch Ratings warns of mounting distress for banks in China, where debt has been shunted off books to circumvent state limits on credit growth.
The pattern looks eerily like the use of "conduits" by Western banks at the height of the credit bubble.
The agency's China team, Charlene Chu and Chunling Wen, said banks had used an "underground market" on a large scale to stoke up lending. "These types of credit and/or institutions fall outside the traditional structures of financial supervision, exposing banks to a growing amount of risk that is for the most part hidden By getting a portion of their credit off books, Chinese banks are able to comply with official loan quotas while in practice exceeding them," he said.
Under the mechanism, the loans are packaged into wealth products and sold to investors searching for bumper yields. The parallel with the US sub-prime debacle is striking, although Fitch avoids an explicit parallel.
Moreover, the banks issue "entrusted loans" in which they act as piggy-in-the-middle between two sets of clients, keeping the credits of the portfolio sheet. These loans have reached 1.5 trillion yuan ($220bn).
Even without such off-books liabilities, the banks are facing a crunch as the economy slows hard and the property market stalls. Shenzen house prices are already down 30pc.
"The Chinese banking system is nearing the point at which it can no longer sustain additional large net withdrawals of liquidity without generating further strains on banks' ability to lend," it said.
Morgan Stanley said this month that China's housing market was heading for a "melt-down". Data is patchy and rarely reliable, but it is clear that home sales in Beijing, Shanghai and other Eastern cities have fallen drastically over the summer. |
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englishmaster
Joined: 03 Sep 2004
Posts: 118
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| Posted: Thu Sep 25, 2008 6:42 am Post subject: |
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President Bush is announcing that the whole US economy is in danger. Even he realizes it. That's bad news. And as many previous posters have noted, any collapse in America's economy has repercussions around the world.
That said, I remain a cautious optimist. For one thing, it's possible for the Asian economies to adjust to a halt in US demand for their exports. They can expand their markets with each other. Europe and America are both going slowly down the tubes for demographic reasons, so Asia will have to adjust sooner or later, anyway.
Since we are in Asia, this gives us some hope of continued employment, although we might be stuck in the part of the world longer than we want if there's nothing to return home to.
Time will tell .... |
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herzog
Joined: 01 Jul 2008
Posts: 26
Location: Spain
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| Posted: Sun Sep 28, 2008 3:25 pm Post subject: What's the outlook? |
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| And for those who are posting on this thread, since you folks are on the ground in Asia, any predictions on how some Asian currencies will fare against the dollar in the next ten months? I'm thinking of the bhat, the riel, the dong. |
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Jati
Joined: 11 Mar 2008
Posts: 155
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| Posted: Mon Sep 29, 2008 6:29 am Post subject: |
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The US$ has been strengthening against the Malaysian ringgit over the past several months. Last April, I was tracking the exchange rate closely, and it got as low as US$1 = RM3.15. Now it is back to US$1 = RM3.45.
Of course this is down from the fixed rate that Mahathir pegged back in 1998 to fix the financial crisis for Malaysia, US$1 = RM3.82. (When I moved to Malaysia in 1996, it was US$1 = RM2.50). They allowed the ringgit to float maybe two years ago when the US dollar started falling against all major currencies.
I think that banks in Asia have not yet begun to look at the extent to which they are exposed to the mortgage crisis. I know that the news looks bad for the USA, but at least there is a growing transparency, and CEOs are either quitting or getting pushed out. Much less transparency in Asia means that the problems will take longer to get solved, if they do get solved. Many times the common person doesn't realise how much hurt they are getting pushed on them by gov't officials and well-connected business people.
See no problems, must mean there are no problems, eh?
Teak |
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