Source: WSJDoes a U.S. slowdown trigger a global one? Some countries are more susceptible to the slowdown in American imports but others say they will be able to whether the storm because of large cash reserves. An excerpt...
In the late 1990s, several emerging markets ran out of foreign reserves and defaulted on debts. In the decade since, some have built huge war chests. Brazil sits on a cushion of $185 billion. Russia has stored some of the country's oil revenues in a fund valued at $160 billion. In all, emerging markets have an estimated $4.1 trillion in central-bank reserves.
"This time we have something of a vaccine when the U.S. sneezes," says Claudio X. Gonzalez, chairman of Kimberly-Clark de Mexico SA, referring to Mexico's estimated $7 billion on hand from oil-export revenues, a recent sale of toll roads, and other sources. "This extra money won't entirely free us from the effects of a U.S. slowdown, but it should help."
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2 comments:
on a loosely related topic, the WSJ had a great editorial yesterday about soverign wealth funds with the theme, "If they are so rich, why aren't they smart?"
really a different way to look at whats going on than what we've been hearing out of DC, i reccommend looking it up
sounds terrible
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