soalnya dr semalem, jaringannya aga g bagus,,
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Versi Nisa :
International financial crisis is one of economic crisis. There are two types of International financial crisis, currency crisis and sovereign default crisis. When a country that maintains a fixed exchange rate is forced suddenly to devalue its currency because of a speculative attack, this situation is called currency crisis or balance of payments (BOP) crisis. When a country fails to pay back its sovereign debt, this situation is called sovereign default crisis. While devaluation and default could be voluntary decisions of the government, it often perceives the involuntary results of changing in investment that leads to a sudden stop in capital inflows or a sudden increase in capital flight.
Sovereign bond is a bond issued by a national government. The term usually refers to bond issue in foreign or standard currencies like US dollar or Japanese Yen, while national government’s bond issue in the country's own currency refers to government bonds. The total amount that owe to the holders of the sovereign bonds is called sovereign debt.
Unpredictable inflation fluctuation or unstable exchange rates often finds its uneconomic bonds issue in their own currencies or denominates more stable in their foreign currencies. It raises the issue of sovereign default if the nation cannot afford to repurchase the necessary foreign currency at bond repayment time, it will bankrupt. Due to the risk of default, investors require the bonds to be issued with a higher yield. It makes the debt more expensive to service, and increases risk of default.
Several currencies that formed part of the European Exchange Rate Mechanism suffered crises in 1992-1993 were forced to devalue or withdraw from the mechanism. Another round of currency crises took place in Asia (including Indonesia) in 1997-98. A speculative attack is the massive selling of a country's currency assets by domestic and foreign investors. Country that utilizes a fixed exchange rate is more susceptible to a speculative attack than Country utilizes a floating exchange rate. It causes the large amount of reserves necessary to hold the fixed exchange rate in place at that fixed level. Nevertheless, if government chooses to maintain a fixed exchange rate during a speculative attack, it risks the chance of severe economic depression or financial collapse, as illustrated by the Argentine and East Asian financial crises.
International financial crises are not new in contemporary economies in the World. Some of the crisis management tools or policies adopted since 1890 or had not substantially changed even in 1930s. One of economic and financial crisis started in July 1997 in South East Asia. Russia, South and North Americas, and the European Union is another example of recent crises with great impact worldwide. It was known by Asia crisis that had brought untold damages to the prestige, growth, development and social improvement plans of the crisis countries.
The latest economic and financial crisis began in 2007 when the lending for property development could not be returned. The credit's number of residents which unable to be paid by instalments housing increased up to 300,000 in September 2008. This congestion was quite shaking the financial world. Dow Jones Index (New York stock index) dropped significantly below the level of 10,000 in the 9800 range. This was the worst level in the history of Dow Jones in recent years. It also occurred in many world stock indexes. In Indonesia, stock corrected 10% during the post reopened after Lebaran holiday. Financial corporations such as Lehman Brothers & Marylyn Lynch declared bankrupt. In Europe, Fortis Bank lost liquidity.
Due to prevent the global financial crisis spreads to the risk of recession, there are many ways to prevent Indonesia from this crisis. It includes to maintain a climate of consumption & production of the domestic market. Today, the economic crisis cannot be separated with international trade (Theory of international trade has proposed by David Ricardo). For example, Indonesia and Japan. Indonesia has fertile land and many human resources. Indonesia must be specializing in the field of agriculture. Japan is superior in the field of technology, so Japan must be specializing in the field of technology. Individual needs of agriculture and technology led to international trade. This different specialization allows a country to improve its position by complementarily.
Now, this theory is not valid anymore. This theory is replaced by Krugman's theory (Paul Krugman - Economics Nobel). Krugman's theory explains that International trade or globalization tends to make concentration both in -what of goods would be produced and where of the location of these goods would be made. In this context, many people who had specialized take the migration into urban regions. This process results in the region that divided into two areas. There are urban concentration areas (identified with high technology and ease) and the margins or the fairies areas (similiar with backwardness and difficult circumstances). it happens in many developing countries including Indonesia.
The new investment will come to some countries if their economic scale can support the production units in large numbers. Therefore, it requires a push from banks to develop the real sector to grow the market. Real sector development is the strong way to prevent financial crisis in the world. For example, We could see Thailand's 1997 economic crisis.
Thailand stricked the imports of consumption goods, improved its quality of export production, and maintained the domestic economics’ climate by limiting the establishment of foreign hyper market. It gave positive impact in Thailand because the velocity of money remained in the domestic and traditional markets and domestic businesses became the backbone of economics. This was the reason why Thailand known as the countries that quickly grown up from 1997’s economic crisis. And now, Thailand incarnates into the automotive industry country and the greatest food country in ASEAN.
Government as the stakeholder of the policy’s function in Indonesia ought to realize their commitment to maintain domestic market by tightening seriously the illegal imports. The effect's from the influence of illegal goods in this country gives powerful influence to the public consumption. For Example, the low cost economic’s import goods such as toothpicks, craft decorating houses, and others are finding easily at the store. Domestic producers cannot grow fast if government releases these goods into the country without examination. Domestic producer must deal with import goods which are cheaper when they start their business. As a result, domestic producers cannot find the experience to reduce the cost of their production. Domestic producers will awake their business cycles if government sets the taps flow of illegal imports.
For example, the national textile producers. the total consumption of textile in Indonesia is only 23 percent that is supplied by domestic producers, another 70 percent supplies by official imports. It means about 70% are supplied from illegal imports. These goods become cheaper due to avoid tariffs, value added taxes and other. If it still was allowed, the domestic producers who cannot stand will be bankrupt
In the prevention of the world economic crisis, all of society elements in Indonesia are required to contribute for the country. For example with intensive consumption of domestic goods, imported goods purchase with foreign currency unit and the profit from the expansion of foreign companies or Multinational companies in this country are deposited to the parent company's profit also with foreign currencies. There are two certainty from this transaction, the depletion of devise and the net income after tax flight to foreign countries. It can increase currency crisis risk and sovereign default crisis risk.
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