Korea’s new boom shouldn’t go bust

I have just got back from a visit to Korea. It’s booming. National output rose 3% in real terms last year. Economic growth is accelerating. It grew at an annual rate of 3.7% in the past quarter and I reckon it’s got further to go. Something near 6% this year looks likely.

The equity market has been riding a global tide of liquidity for some months. The central bank pumped up money supply by 20% in 2000 and another 10% last year.