A Large Speculator in Contagious Currency Crises: A Single "George Soros" Makes Countries More Vulnerable to Crises, But Mitigates Contagion
- Topics:
- Investment and Capital Markets
- Tags:
- Crisis,
- Finance,
- Financial Accounting,
- Financial Services,
- Investment,
- University Of Wisconsin
- Source:
- University of Wisconsin
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Overview: This paper studies the model that proposes a new contagion channel and shows how a currency crisis can spread from one country to another even when these countries are totally unrelated in terms of economic fundamentals. It finds that the better the economic fundamentals in the originating crisis country, the more severe the contagion under certain conditions. The model presents policy implications as to financial disclosure and size regulation of speculators such as hedge funds, which recently have been hot topics among policy makers.
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Format: PDF | Size: 290KB | Date: Nov 2003 | Pages: 45



