Today's situation is grim, but currency crises and sovereign defaults would only make the mess worse.
The recent currency crises in Asia, Russia and Brazil have been produced by central banks and their soft national currencies.
Understand that the performance for Morgan's index is a total return, net of all expropriations and currency crises.
Co-ordinating a European response amid a series of currency crises or exchange-rate rows would have been far trickier.
Japan's Asian neighbours are also concerned: a fall in the yen helped to trigger their currency crises in 1997-98.
First, the country dodged the hedge fund speculation that set off a chain of currency crises across Asia in the late 1990s.
He consistently made money for Banco Pactual through Brazil's seesawing currency crises: who better to make cool bets during America's subprime meltdown?
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Though the currency crises that hit both countries were caused mainly by economic mismanagement, it is striking that both are big laundering centres.
Currency crises might also occur because pegging the exchange rate requires governments to use monetary policy in order to maintain the currency's value.
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The recent history of emerging market investing has been fraught with currency crises, massive fiscal and trade deficits, debt defaults, political risk and hyperinflation.
Nobody seriously expects it to fall apart indeed, the euro has protected its more vulnerable members from what might otherwise have been serious currency crises.
As long as countries try to simultaneously follow inflationary policies at home and peg their exchange rates to the dollar, we will continue to have these currency crises.
Mr Krugman, who pioneered formal economic analysis of what causes currency crises, points out that Asia's banks and finance companies operated with implicit government guarantees.
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Moreover, abandoning the gold standard in favor of free floating currencies was supposed to eliminate currency crises and lead to an automatic adjustment in trade imbalances.
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The wealthy families of Latin America learned long ago how to deal with the periodic currency crises that have beset the region over the past century.
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Bankers have already had to roll over many of these loans, and, thanks to currency crises and economic collapses, a large proportion will probably end up unrecoverable.
In other words, a foreign inflow, as well as financing good things such as public infrastructure and corporate investment, is also associated with debt defaults, inflation and currency crises.
That will lead to currency crises and cross-border disputes like the current spat between Iceland, Britain and the Netherlands over the bill for compensating depositors in Icelandic banks (see article).
This phenomenon, in concert with the ongoing and possibly deepening global credit crisis, could also result in unprecedented volatility in the stock market, not to mention currency crises and related economic dislocation.
Modern currency crises the fracturing of Europe's exchange-rate mechanism in 1992, the Mexican peso crash in 1994, the collapse of East Asia's currencies in 1997, and the recent attacks on the Russian rouble are often blamed on them.
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According to those very same pundits, Bernanke and company are leading us down the path of runaway price increases and a devaluation of the dollar that will eventually lead us to the mother of all currency crises.
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The fear of currency crises and the subsequent unemployment, bankruptcies and stalling of economic growth have made many developing countries' governments even more wary about the free flow of capital than they are about free trade in goods.
In effect, he is asking why his country should be vulnerable to the destructive currency crises sweeping the world, including neighboring Brazil, and, why, instead of trying to keep the peso tied to the dollar, he shouldn't make life simpler by using the dollar itself.
Previous terms for these episodes were bank failures, financial panics, runs on currency, debt crises, liquidity runs, national defaults, bubbles, hyperinflation.
Currency and financial crises have strong cross-border spillover effects - instability can fairly easily spread even if neighboring countries' economic fundamentals are sound.
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Modern Latin American economic history is littered with the detritus of defaults, banking crises and currency controls.
The gold standard had many flaws, but the chief virtue of fixing the exchange rate and constraining the supply of credit was to stop politicians succumbing to the inevitable pressure to respond to crises by debauching the currency, resulting in long-term harm to the livelihoods and living standards of their citizens.
Yet Argentina's experience provides clear evidence that even currency boards, where the rate is fixed by law, and where the domestic currency has to be backed by hard-currency reserves, are not immune from crises.
Something very close to this is necessary, in the IMF's view, to manage this and future crises and build a stable single currency area.
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