As we have discussed in lectures, the number, magnitude, and frequency of financial crises have increased since the 1990s. These crises illustrate the growing problem of capital flight and short-term international speculation in currency and security markets in additional to the underlying fundamental economics issues. We will learn about the 1997 Asian Financial Crisis with a focus on its contagion effect and the case of South Korea, the 2002 Argentina Economic Collapse with a focus on the underlying issues and long-term fix, and the European Union Crisis with a focus on the EU’s underlying structural problems and the impact of Brexit. From watching these videos, you will apply classroom knowledge to solving real world problems, learn about how these crises occurred, what are the hard lessons that can be learnt, and finally reflect upon how to handle, and most importantly, avoid such crises in the future.

Reflection 1. The 1997 Asian Financial Crisis

· Asian Contagion – 1997.

· Conquering a crisis – The IMF’s role in helping Korea overcome the Asian crisis. IMF 2002.

The Asian financial crisis, with its impact still in place today, was a period of financial crisis that gripped much of East Asia beginning in July 1997 and raised fears of a worldwide economic meltdown due to financial contagion. The crisis started in Thailand with the collapse of the Thai baht after the Thai government was forced to float the baht due to lack of foreign currency to support its currency peg to the U.S. dollar. At the time, Thailand had acquired a burden of foreign debt that made the country effectively bankrupt even before the collapse of its currency. The first video is an introduction to Asian contagion, while the IMF 2002 video, entitled “Conquering a crisis: The IMF’s role in helping Korea overcomes the Asian crisis,” focuses on how the crisis trickled down to South Korea, and how South Korea, with the help of the IMF, conquered the crisis.

300 words minimum, font 12, no more than 2 pages.

To write a good reflection, carefully watch and capture the essence of the two videos, describe, elaborate, and summarize the key contents of the videos, and conclude in the last paragraph what are the hard lessons that can be learnt, and reflect upon how these crises could have been better handled, avoided and how to prevent similar crises from recurring in the future.