Something is wrong in Latin America. Currencies are tanking with astonishing speed, and the people are taking to the streets. At the root: what’s called “financial contagion.” Argentina led the way, defaulting on national debt and devaluing the currency in a collapse so profound that hungry mobs recently fought over a spilled truckload of live cattle.
Uruguay, Paraguay and, here’s the big one, Brazil are worried, and that’s got the Bush administration on alert, reversing philosophical course on whether or not to bailout these economies.
Treasury Secretary Paul O’Neil is in Latin America this week, putting a finger to the pulses, figuring out how triage should work amidst so many bleeding patients. Saving Latin America and covering our own assets down South.
Guests:
Guillermo Perry, chief economist of the Latin America and Caribbean region of the World Bank
Nancy Birdsall, president of the Center for Global Development
Jeffrey Frankel, James W. Harpel professor of capital formation and economic growth, Harvard’s John F. Kennedy School of Government
Ray Collit, Sao Paolo bureau chief, the Financial Times