Asian Financial Crisis

The Asian financial crisis was an avalanche of financial upheaval that spread throughout Asia, which resulted in falling currencies and plunging stock prices. The whole shebang began in July of 1997 when the Thai baht (Thailand’s currency) collapsed after becoming a floating currency.

The cause of the crisis was fueled by a lack of financial balance. Too much money was being borrowed from banks (development was rampant). Further, too much weight was coming from outside investors, due to booming exports. As a result, the value of stocks and housing crashed. The event then created a domino effect that spread to other countries in the region.

The World Bank and International Monetary Fund eventually kicked in financial support to help struggling countries like Thailand get back on their feet.