200

220

240

260

280

300

320

Q1-

99

Q3-

99

Q1-

00

Q3-

00

Q1-

01

Q3-

01

Q1-

02

Q3-

02

Q1-

03

Q3-

03

Q1-

04

Q3-

04

Q1-

05

Q3-

05

Bill

ion

199

3 P

esos

Source

ceteris paribus

0

10

20

30

40

50

60

Jan-

00

Fe

b-0

0

Ma

r-0

0

Ap

r-0

0

Ma

y-0

0

Jun-

00

Jul-0

0

Au

g-0

0

Se

p-0

0

Oct

-00

No

v-0

0

Dec

-00

Jan-

01

Fe

b-0

1

Ma

r-0

1

Ap

r-0

1

Ma

y-0

1

Jun-

01

Jul-0

1

Au

g-0

1

Se

p-0

1

Oct

-01

No

v-0

1

Dec

-01

Jan-

02

Inte

rest

Ra

te (%

)

PesosDollars

Sources

And the Money Kept Rolling In ): Wall Street, the IMF, and the Bank-rupting of Argentina

EmergingFinancial Markets

-5

0

5

10

15

20

25

30

Jan-

00

Mar

-00

May

-00

Jul-

00

Sep

-00

No

v-00

Jan-

01

Mar

-01

May

-01

Jul-0

1

Sep

-01

No

v-0

1

Jan-

02

Diff

ere

nce

in I

nte

rest

Ra

tes

(%

)

0

1000

2000

3000

4000

5000

6000

EM

BI+

Arg

en

tina

Str

ip Sp

rea

d

Weekly Interest Rate DifferenceDaily EMBI+ Argentina Strip Spread

-5

0

5

10

15

20

25

30

Jan-

00

Mar

-00

May

-00

Jul-0

0

Se

p-0

0

Nov

-00

Jan-

01

Mar

-01

May

-01

Jul-0

1

Se

p-0

1

Nov

-01

Jan-

02

Diff

ere

nce

in I

nte

rest

Ra

tes

(%

)

0

500

1000

1500

2000

2500

3000

3500

4000

4500

EM

BI+

Arg

en

tin

a Sp

rea

d O

ver

Tre

asu

ry

Weekly Interest Rate DifferenceDaily EMBI+ Argentina Spread Over Treasury

A

B

Sources available at

i i ( ) (% )

43

44

45

46

47

48

49

50

51

52

53

54

Jan-

01

Feb

-01

Mar

-01

Apr

-01

May

-01

Jun-

01

Jul-0

1

Aug

-01

Sep

-01

Oct

-01

Nov

-01

Dec

-01

Bill

ion

U.S

. D

olla

rs

Source

corralito

corralito

0

5

10

15

20

25

30

35

40

Jan-

01

Feb

-01

Mar

-01

Apr

-01

May

-01

Jun-

01

Jul-0

1

Aug

-01

Sep

-01

Oct

-01

Nov

-01

De

c-0

1

Bill

ion

Pe

sos

Note

Source

-20

-10

0

10

20

30

40

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

Bill

ion

U.S

. Dol

lars

TotalFDIEquityDebtOther

Note

Source

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

Jun

-00

Aug

-00

Oct

-00

De

c-00

Feb

-01

Apr

-01

Jun

-01

Aug

-01

Oct

-01

De

c-01

Feb

-02

Apr

-02

Jun

-02

Aug

-02

Oct

-02

De

c-02

Arg

en

tin

e P

eso

s / U

.S.

Do

llar

Source

Financial Times

Systemic Financial Distress: Containment and Resolution

Brookings Trade Forum

Preventing Currency Crises in Emerging Markets

Real Exchange Rates, Devaluation, and AdjustmentJournal of International Economics

Financial Fragilities in Latin America: The sand s

Note

Sources

Bulgaria

Argentina

UruguayBolivia

Ecuador

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

8 10 12 14 16 18 20 22 24 26

Reinhar t-Rogoff-Savastano Composite Index Level: 1996-2001

2001

Exp

orts

/GD

P

Ecuador

Bolivia

Uruguay

Argentina

Bulgaria

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

0.0 0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6 1.8 2.0

2001 CDDD/Pr ivate Credit

200

1 E

xpor

ts/G

DP

A

B

Sources

available at

Sourcesavailable at

available at

Uganda

Turkmenistan

Pakistan

Hungary

Georgia

Estonia

El Salvador

Costa Rica

Belarus

Armenia

Thailand

Philippines

Moldova

Jamaica

Cote d'Ivoire

Bahrain

Vietnam

Russia

Mongolia

Kyrgyz RepublicYemen

Tanzania

Sierra Leone

MalawiGuinea

Croatia

Congo DR

Indonesia

Turkey

Tajikistan

Jordan

Honduras

Ghana

Zambia

Sao Tome & Pr�ncipe

Mozambique

Lebanon

Guinea-Bissau

Paraguay

Cambodia

Peru

Angola

Bulgaria

Argentina

UruguayBolivia

Ecuador

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

8 10 12 14 16 18 20 22 24 26

Reinhart-Rogoff-Savastano Composite Index Level: 1996-2001

2001

Exp

orts

/GD

PC

NoteSources

availableat

Note

Sources

available atavailable

at

the

Uganda

Pakistan

Hungary

Georgia

Estonia

Costa Rica

Belarus

Armenia

Thailand

PhilippinesMoldova

JamaicaCote d'Ivoire

Bahrain

Vietnam

Russia

Mongolia

Kyrgyz RepublicYemen

TanzaniaSierra Leone

Malawi Guinea

CroatiaIndonesia

Turkey

Jordan

Honduras

Zambia

Sao Tome & Pr�ncipe

Mozambique

Lebanon

Guinea-Bissau

Paraguay

Cambodia

Peru

Angola

Bulgaria

Argentina

UruguayBolivia

Ecuador

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

-1 1 3 5 7 9 11

2001 CDDD/Pr ivate Credit

2001

Exp

orts

/GD

PD

Quar-terly Journal of Economics

Brookings Papers on EconomicActivity

Journal of Business

0

1

2

3

4

5

6

7

8

9

Jun-

94

Aug

-94

Oct

-94

De

c-94

Feb

-95

Apr

-95

Jun-

95

Aug

-95

Oct

-95

De

c-95

Feb

-96

Apr

-96

Jun-

96

Aug

-96

Oct

-96

De

c-96

Me

xica

n P

eso

s /

U.S

. Dol

lar

Source

t t tt t

St tt log(St log( t

t log(St St ) log(St StI t tK t t

t I t/ K t

t I t I t )/ K t

A t tt t

t tt t t )/ t

t t t t t )/ tt t/ t

Note:

Hypothesis 1 ceteris paribus

Hypothesis 2 ceteris paribusin Mexico

in Mexico

Hypothesis 3 ceteris paribusnot in Argentina

in Argentina

t

T

Argentina

T

Mexico

T

Note

tT

Source

Argentina

T

Mexico

T

NoteSource

higher

t

T

Argentina

T

Mexico

T

NoteSource

despite higher

ceteris paribus ceteris paribus

T

Argentina

T

Mexico

T

NoteSource

not

controlled for

t

Argentina

T

Mexico

T

NoteSource

Argentina

T

Mexico

T

NoteSource

t

T TP > P >

t( ) ( )

t( ) ( )

( ) ( )

( ) ( )t

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( ) ( )

t( )

t( )

( ) ( )

Regression statistics

RR

NoteSource

t

T TP > P >

t( ) ( )

t( ) ( )

( ) ( )

( ) ( )t

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( ) ( )

t( ) ( )

t( )

t( )

( ) ( )Regression statistics

RR

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T TP > P >

DDA t

Regression statistics

RR

two

per seannouncements

Inter Press Service

The Economist

Hypothesis 4ceteris paribus

The Economist

Utilities

High-energy consumers

Note

seeand

Source

t

T TP > P >

t( ) ( )

t( ) ( )

( ) ( )

( ) ( )t

( ) ( )

( ) ( )t ARG

( ) ( )

t( )

t ARG( )

( ) ( )

( ) ( )

( ) ( )

Regression statistics

RR

NoteSource

long-run positive

yT

T TP > P >

t( ) ( )

t( ) ( )

( ) ( )

( ) ( )t

( ) ( )

( ) ( )

t ARG( ) ( )

t( )

t ARG( )

( ) ( )

( ) ( )

( ) ( )Regression statistics

RR

NoteSource

T TP > P >

( ) ( )t

( ) ( )

( ) ( )

( ) ( )

( ) ( )Regression statistics

RR

Note

T TP > P >

( ) ( )t

( ) ( )

( ) ( )

( ) ( )

( ) ( )Regression statistics

RR

Systemic FinancialDistress: Containment and Resolution

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