Oriental Hotel,
Bangkok, Thailand
I am putting on the hot and green curry, which is a speciality dish here and resembles a mangrove swamp but comes on very nicely, at that, when a notion lights up in my head like a bulb, a whole new law of markets: always go short of a country that stages an IMF meeting.
I mean, when I am last in Bangkok it is six years ago and they put on a truly great meeting, everyone who survives it enjoys it, the joint is jumping and the economy is tigerish, we all want a piece, but just look at it now, up the swamp without a mangrove, money owing everywhere, your boy in here on a salvage job and the IMF trudging back to mop up.
Mom, you know how one year in every three the IMF moves out of town, all those desk jockeys hate to be dug out of cosy Washington DC and closer to the action but the change is good for them, and the member countries fall over each other to put the show on.
By now I see this as a 20-year series: 1976 sets it off with the IMF's chiller in Manila, benefit week for the Marcoses, leave your money with them and see it walk out to the shoe shops, and 1979 is the bathplug crisis in Belgrade, capital of what is then Yugoslavia but now turns into Bosnia and Herzegovina and so on, all not apt to pay their own debts, let alone some debts left over from the previous management.
This does not yet happen to Canada, quite, which is the one thing to be said for Toronto, 1982, this is when the Mexicans come sidling up and ask for time to pay, and soon enough we have a line of debtor countries pleading hard luck stories, tho' of course the guys who are truly unlucky are us.
Seoul 1985 is a blur, the place has crises and recoveries so fast I do not now recall where '85 fits in the cycle, tho' it seems they have a small crisis on now, but Berlin 1988 is a painful memory, it is where my friend from the Fugu Fish Bank of Hokkaido complains to the police, why is his party not rated important enough to have demonstrators bust it up, the loss of face is unbearable.
What we none of us see coming is the all-paper offer, which pops up the very next year, half of Germany bids for the other half, one for one in Marks, your directors recommend acceptance, monetary union in one country, on terms designed to cripple both sides, Karl Otto says so and is trampled into the ground for his pains, but he is right and Berlin fits my series.
So then it is Bangkok 1991, and maybe we all get a little excited, back home all our economies are looking stupid but these Asian guys like the Thais seem to have the right idea.
Thailand looks just the place for an emerging markets fund, I put Holey Buckett to work and sure enough he launches one and calls it Thaigers Aiye, to give the guy credit he does his researches in person, so we are big in fast-moving pharmaceuticals and real estate, like Poppy Products Preferred and Patpong Road Properties, and also a leisure stock called Phuket and Sea.
Guys like my friend from the Fugu Fish Bank are happier just pouring money in, it goes down in his books as financing Japanese direct investment in Thailand, like in a chain of fugu fish canneries, but once it gets there the Thais lap it up, they can borrow in dollars or in yen for less than it costs them to borrow from their own banks in their own bahts, and the poor saps figure this for a free lunch.
All this incoming money does wonders for values, we have one delirious week when Thaigers Aiye tops the tables for the best performing fund in emerging markets since the week before, and in Bangkok a crop of new lenders springs up on the fringe, specializing in real estate, I remember all this happening when I am first in London, it is enough to make a guy believe in reincarnation.
Well, sure enough, the Great Wheel of Being revolves, and stock prices in Bangkok prove they can go down as well as up, and real estate prices move sideways, on account there are no buyers, and the fringe lenders find they cannot borrow, and the finance minister and central bank governor fall out and resign, and in their democratic way the Thais send out for a new general.
What no-one cares to tell him is his country's external account is being financed by my friend from the Fugu Fish Bank, who is tiring of this, and picky about who he lends to, and when he stops, everything stops, down comes the baht like an express elevator and in comes Michel's IMF swat team to sort it all out.
They explain how this prompt and timely intervention is calculated to restore stability, but naturally it does no such thing, it just draws the markets' attention to neighbour economies, what happens to them if the money that is going in starts coming out, the answer is they have their currencies upended like a row of skittles, first Malaysia, and then Indonesia, and the Philippines, which is where my series comes in.
All I can do here is to scoop up Thaigers Aiye's assets and stuff them into our emerging hedge fund, which is called Malaise and is going up the charts, but I figure now is the time to think serially, after Bangkok '91 comes Madrid '94, it must be time to go short of Spain soon, and if the Spanish think they can cut in on the first round of monetary union on one continent, Quantum and Malaise are ready for them.
After Madrid '94 comes Hong Kong '97, which is where your boy is due next, I do hope they get through the meeting all right, but the secondary market in rooms at the Mandarin is already falling, much love from