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No, I said that this was a currency crisis.

Currency crises are caused by structural CA imbalances (note: Imbalances include CA surpluses - the surplus country is as responsible for the imbalance as the deficit country).

They are triggered by all sorts of things, and there is a substantial component of black magic in divining when a vulnerability to a currency run will translate into an actual run (though in this case it was real easy: Just sort the structural CA deficit countries in ascending order of political power).

Really, the distinction between fundamental and proximate cause is not a novel concept or arbitrary imposition. It has been a recognised concept in every school of epistemology (except perhaps the radical social constructivists) since Aristotle. And I did dare to presume - wrongly, apparently - that you had paid attention to epistemology at some point in the last three or four thousand years.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu Sep 8th, 2011 at 02:42:59 AM EST
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