Tuesday, April 21, 2009

Poland & Brazil as model economies?


While it seems that the vast majority of governments around the world are engaged in economic insanity,

There are some countries for which this is not true; those which, for one reason or another, did not adopt the prevalent global pattern of monetary laxity and fiscal hysteria. Poland, for example, was always likely to get in trouble from this recession, because it ran a balance of payments deficit, and over 5% of its gross domestic product (GDP) came in through foreign direct investment, which has dropped sharply. However, instead of engaging in massive stimulus, Poland allowed the zloty to depreciate by about 30% against the euro since July 2008, while its M3 money supply, up 17% in zloty terms, declined in euro terms by over 10%.

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