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Those lucky Asians! Their economic crisis is over. The
business press is telling us so.
Note the last sentence for modern capitalism's definition of a
sound economy.
From the Toronto Star, Sept. 21, 1999
A year ago, the Asian economic flu was rampant and everyone
was heading for cover. A year later, everyone is rushing back in.
The startling recovery has taken even financial optimists by surprise while seasoned portfolio managers, caught off guard, have had to crank up their forecast numbers. The statistics speak for themselves. If you look at the 52-week numbers in Asian stock markets, for example, Korea is up 225 per cent; Hong Kong, close to 80 per cent; Singapore, 150 per cent; Thailand, 100 per cent; and Malaysia is following close on Thailand's heels. Adding to the fuel, the yen has surged to its highest level in three years against the U.S. dollar, hovering around 110 yen per greenback. Maybe the rescue tactics of the International Monetary Fund in Indonesia, Korea and Thailand can be credited for the turnaround in the Asian economy. Or maybe the push for government/banking reforms and business restructuring is responsible. Whichever it is, the recession appears to be ending. Yet, despite the fact Asian markets are on wheels, only a month ago the cover of The Economist magazine showed a sketch of Asia on a yo-yo with its frayed string about to snap. Is the strength of the Far East recovery sustainable or will the roar of the Asian tiger become just a whimper? We interviewed four managers who oversee Asian funds for Canadian investors. Their ports of call range across the globe, from Toronto to Fort Lauderdale and from Edinburgh to Hong Kong. On the home front, we spoke to Mark Grammer, vice-president of foreign equities for Altamira Investment Services Inc. From his office in the Exchange Tower in Toronto, Grammer is responsible for $300 million in Asian assets, managing the Asia Pacific Fund, the Japanese Opportunity Fund and the Global Diversified Fund. According to Grammer, ``we saw a quantum shift, I think, in March in the Japanese economy. When Sony, always a Japanese business leader in the last decade or two, announced its restructuring, it sort of opened the floodgates. All of a sudden, everybody wants to tell you about restructuring and what they're going to do and how much cost they're going to cut. And it's definitely for real. Wages are coming down dramatically and unemployment is going up: It's at a high since the war,'' he says. |
