28 NOVEMBER 1997. WORLD: STOCK MARKETS
"Did the El Nino in southeast Asia already cause the stock-market correction? An interesting question and far from trivial. To begin with the current impact in Indonesia exceeds that of 1982/83 by a considerable margin. 1982/83 was a double drought for Indonesia unlike all other El Nino's this century which were single droughts i.e. normal, drought,>normal (over 3 years). The only other El Nino double drought in the instrumental record for Indonesia was 1877/78 which event sent famine into the world in more than one country. It even has a name: the "great dry". Next, it is an elementary attribute of population ecology that population vigor, well being, growth etc depend primarily on productivity with particular reference to consumers in relation to producers. The productivity of Indonesia, the Philippines and Papua New Guinea have all suffered significant set-backs. The Philippines has ordered additional rice, PNG has formally requested Food-Aid, traces of famine have appeared in east Indonesia.. Productivity throughout southeast Asia is "not good" to say the least, depressed even is more like it. Hong Kong is home to some significantly involved natural resource based multinationals having MAJOR interests in southeast Asia. Is it just faintly possible that one or two stake-holders shifted stock off their books because of the KNOWN hit to southeast Asia? Remember, the dry is not yet finished in Indonesia, it could go on all through December as it did in 1994. If 1998 is also a drought, i.e. a double drought - if the warm water pool does not dissipate by the next dry season (May-October in normal circumstances or less) --then what? Moving money out of a productivity dependent natural resource based company might not have been such a foolish option BUT, now we have computers that watch computers and react accordingly.......did El Nino cause the stock market correction? Is this notion just El Nonsense ? I think not and I lived 14 years in Indonesia from 1981 to 1994 (4 El Ninos I saw there and just came back from viewing the 5th)."--Robin Harger < robinharger@compuserve.com>