Jul 17, · The Asian financial crisis, like many other financial crises before and after it, began with a series of asset bubbles. Growth in the region's export economies led to high levels of foreign direct investment, which in turn led to soaring real estate values, bolder corporate spending, and even large public infrastructure projects. Heavy borrowing from banks provided most of the funding.
Modern Case of the Asian Financial Crisis. This caused the Federal Reserve to fear the possibility of a second Asian financial crisis. For example, China sent a shockwave through equity markets in the United States on August 24, , when it devalued the yuan against the USD. This caused the Chinese economy to slow.
Asian financial crisis, major global financial crisis that destabilized the Asian economy and then the world economy at the end of the s. Though it is generally characterized as a financial crisis or economic crisis, it can also be seen as a crisis of governance at all major levels of politics.
A review of East Asia’s experience suggests that while a classic panic may have played a role, financial sector weaknesses were a major contributor to the recent financial crisis. Such weaknesses appear to reflect the inability of lenders to use business criteria in allocating credit and implicit or explicit government guarantees against eccpasa.info: Ramon Moreno.