Why we should cry for Argentina
During our recent trip to South Africa, I picked up a copy of
The Straits Times, Singapore, 18 July 2001, and under the above headline,
read some very interesting news. We quote in part herewith:
"At the bottom of The Business Times' front page
last Saturday was a story about the Argentine debt crisis. Argentina? Why should
we care? Apart from its flamboyant soccer stars, its tango music and its
sumptuous steaks, it doesn't figure often on our radar screens...
Curiosity aside, why should we cry for Argentina?
One clue: a Dow Jones newswire story last Thursday with this
lead: 'Financial problems in Argentina also weighed on Korean stocks...'
The Argentine crisis is basically about a default risk on the
international bond markets. After three years of recession, the country is
saddled with a debt of US$130 billion (S$238 billion), which many investors
believe it will not be able to service.
Argentines themselves appear to have doubts too, and have
been rapidly converting their pesos into US dollars and parking the money in
places like Miami, which also threatens the peso's long-standing link to the
The Bush administration has said it won't be providing a
special lifeline for Argentina, and that the country must put its own house in
order, with support from the International Monetary Fund...
Meanwhile, the uncertainty is trying the nerves of
bond-market investors. They have started selling Brazilian and Mexican bonds as
well. Last week, yield on Philippine and Malaysian paper also rose...
Which is why you get stories like the ones about Argentine
debt problems weighing on Korean stocks and on Malaysian bond yields. And, as
we discovered during the crisis, if one Asian economy is hit, the contagion can
spread easily..." (emphases added).
This is called the domino affect and thus financiers are
recognising that even a country as far away as South America can very vitally
affect the economies of South East Asia and, for that matter, the rest of the
Never forget the adage that the economy of this world is
buying and selling, but the economy of Heaven is giving and receiving.
The Lord bless you, the reader, as you look to the Lord for
your help and supplies in the days ahead.