With the 1997 Asian Financial Crisis still fresh in our minds, we are looking for solutions to help our economy and help those in need of help. But first we have to think about what the Asian Financial Crisis was all about. The following article will discuss the reasons and consequences of the financial crisis on the people in Asia.
One of the main issues that was causing the problem in the first place, was the United States Dollar devaluing against the Asian currency. After the US Dollar crisis, Asia began investing heavily in the US Dollar because they saw this as a safe way to invest their hard earned money. With so much money going into this American currency, the Asian economies were getting hammered with bad debts, rising unemployment, and rising inflation. All of these factors lead to a collapse of the Asian economies, which in turn caused a global economic meltdown.
To make matters worse, many people in Asia were having problems paying off their mortgages. This caused more interest rates to go up and eventually pushed the Asian economies into bankruptcy. The government of South Korea borrowed billions of dollars from other countries, but ended up borrowing even more by issuing bonds, which made the debt even more out of control. And of course the Japanese government and the Bank of Japan, were in on the action as well.
Many countries in Asia took advantage of the situation, like China, Korea, and Malaysia. In fact, when President Bill Clinton left office, many American politicians were asking why the US was helping Asia. In the end though, the United States was forced to get involved because it was hurting too much economically. The United States also had a policy of encouraging trade, so as to help the economies recover. This policy of encouraging trade caused the Asian economies to lose a lot of jobs in America, which in turn allowed these poor countries to attract more jobs in the United States.
The Asian Financial Crisis was a wakeup call for the United States. We are not perfect and there are times when we are willing to make mistakes. In fact, we should be grateful to the Asian Nations for the help that they gave us, while at the same time, pointing out some of the problems that we have in the US that caused the financial crisis. Even though we did some mistakes, we did help the Asian Nations.
Now that the Asian nations have recovered and are starting to build back their economies, we are beginning to see the benefits of the Asian Financial Crisis recovery. on their own and on our own. I am happy for the Asian nations because now they have to deal with their own problems. But we must never forget that the United States has a part to play in helping them out.
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