Opening A Bank Account If Bankruptcy Malaysia

Spectre of another bond crash is spooking Asia.

Summary: Tokyo: Kim Choong-Soo is seeing ghosts, and that should
scare you. No, the Bank of …

Tokyo: Kim Choong-Soo is seeing ghosts, and that should scare you.
No, the
Bank of Korea

 governor isn’t seeing ghouls or hearing
things that go bump in the night. The nightmare preoccupying him
involves
Alan Greenspan

 and what traders call the Great Bond Market
Massacre of 1994. Kim worries that history is about to repeat itself,
potentially devastating Asian
growth rates

. Back in the 1990s, when he
was Federal Reserve chairman, Greenspan doubled benchmark lending rates
over 12 months, causing, according to Fortune magazine, more than $600
billion in losses on US Treasuries. The chaos drove Orange County,
Calif., into bankruptcy; sank Kidder Peabody; pushed Mexico into crisis;
and precipitated Asia’s 1997 meltdown as a surging dollar strained
currency pegs. Now, Greenspan’s successor, Ben S. Bernanke, is
under pressure to unwind the U.S. central bank’s unprecedented $3.3
trillion balance sheet. A growing number of staff members want to scrap
the Fed’s quantitative-easing experiment or at least curtail its
$85 billion purchases of debt each month. Once the “tapering”
process begins, debt yields from Seoul to Sao Paulo will probably jump
in sudden and destabilising ways. ‘Ghost of 1994’ Fed
officials insist they will tread carefully, but Kim can’t help but
fear that the “ghost of 1994” will again wreak havoc on bond
markets. And he’s not alone.
Bank of America

Bank of America (NYSE: BAC TYO: 8648 ) is the largest commercial bank in the United States in terms of deposits, and the largest company of its kind in the world.
 Merrill Lynch
strategist Michael Hartnett warns of a “repeat of the 1994
moment,” and Goldman Sachs Chief Executive Officer Lloyd Blankfein
admits “I worry now” as “I look out of the corner of my
eye to the ’94 period.” “We all experienced that, and we
all know what happened, and I hope not to experience that again,”
Kim told the Wall Street Journal last week. He wants policymakers to
“find a compromise solution so that all things will happen in an
orderly fashion. If not, then we are likely to face another series of
difficulties. ” That could be a huge understatement in Asia, where
last time around, Indonesia, Korea and Thailand were forced to seek
International Monetary Fund bailouts. There are three big risks if
Bernanke & Co. withdraw liquidity: higher borrowing costs, huge
swings in financial markets and lower economic growth. And that’s
if the Fed restores normalcy to monetary policy in an orderly, gradual
and transparent way. If the process is handled clumsily, as it was in
1994, then 2014 could be a disastrous year for the world’s most
dynamic region. “The markets that are particularly volatile are
high-yield and emerging-market debt,” says Dan Fuss, who manages
the $23.3 billion Loomis Sayles Bond Fund in Boston and is a veteran of
many bond-market crashes dating back to the 1960s. “The scenario
isn’t pretty.” The Fed may not move for some time. US
unemployment is more than seven per cent, and the risks of deflation are
at least as high as those of accelerating inflation. Also,
Bernanke’s Fed is far more open and communicative than
Greenspan’s Kremlin-like organisation. The odds favour Bernanke
telegraphing policy shifts well in advance. Yet any missteps could
quickly panic markets. Sovereign-debt levels have more than quadrupled
to $23 trillion since 1994. Concerns about too much debt chasing too few
buyers could amplify market swings. The world economy was a far
healthier thing 19 years ago, before the euro existed, China’s
economy mattered and high-frequency trading dominated the world’s
bourses. Asia now holds trillions of dollars of currency reserves. For
all the problems that ultra-low rates cause, they also boosted gross
domestic product. Asia must find ways to fill the void with looser
fiscal and monetary policies of their own. The real worry, though, is
full-blown
financial contagion

A financial problem that spreads among companies or regions. For example, Russia’s 1998 default triggered sharp declines in the market values of debt issued by emerging countries.
. Korea is better positioned than many
peers, thanks to a sizable current- account surplus. The same goes for
the Philippines, Taiwan and to Singapore.
Retool
  
v. re·tooled, re·tool·ing, re·tools

v.tr.
1. To fit out (a factory, for example) with a new set of machinery and tools for making a different product.

2.
 economies Southeast
Asian economies that didn’t use the rapid growth of recent years to
retool economies — here, think Malaysia, Thailand and Vietnam — are
vulnerable. Export-addicted China could be in for a rough ride. Nor will
Japan be unscathed. When Bernanke followed Tokyo’s example by
cutting rates to zero and beyond, he couldn’t have expected the
Bank of Japan to one-up the Fed’s experiment. Bank of Japan
Governor Haruhiko Kuroda would have to venture even further into
uncharted monetary territory to offset a Fed reversal. Policymakers must
act now and in concert to prepare for the worst. “Coordination
seems to be the name of the game,” says Marshall Mays, director of
Emerging Alpha Advisors in Hong Kong.

Muscat
  or  , city (1993 pop. 533,774), capital of Oman, SE Arabia, on the Gulf of Oman. It is flanked by rugged mountains.
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