| | THE MEXICAN PESO CRISIS-DOUGLAS W. ARNER |
 | | Further, the Peso Crisis underlines the need for a coherent international response to similar problems likely to develop in other emerging markets in the future, given that the highly mobile nature of international capital flows is unlikely to slow and in fact may increase. |
 | | In circumstances such as the Peso Crisis, in which financial markets essentially cease to function in terms of access, markets cannot be relied on to provide necessary liquidity, and for this reason, an international response is probably necessary for the stability of the international and domestic financial systems. |
 | | In this context, the Peso Crisis is illustrative of the situation that a sovereign may find itself it in: as the Peso Crisis commenced, the Mexican government had approximately $90 billion of debt outstanding. |
| iibf.law.smu.edu /pub/doug1a.htm (9402 words) |