Most of Asian economies are experiencing the asset bubble like the U.S., and Mr. Chan, chief executive of the Hong Kong Monetary Authority, admits there is major bubble blowing.
However, officials don’t seem to willingly correct the situation until all asset bubbles burst.
From Market Watch:
“With interest rates exceptionally low and with abundant liquidity around the world, Hong Kong faces the potential risk next year that asset prices may go up sharply and become increasingly disconnected from economic fundamentals," said Norman Chan, chief executive of the Hong Kong Monetary Authority, in a statement posted on the agency's Web site.
Chan said Hong Kong wasn't alone in facing these risks, as many other Asian economies were experiencing similar problems arising from substantial fund inflows.
"We can be certain that the larger an asset bubble has become, the greater will be the damage when the bubble bursts," Chan said.
http://www.marketwatch.com/story/hong-kongs-central-banker-sounds-bubble-alert-2009-11-20
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