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Under the volcano

Article Abstract:

The collapse of the peso and Mexico's stock market was brought on by a large deficit in its foreign capital current account, caused by rising consumption and reduced investment. Countries with large current-account deficits should be evaluated as to whether high investment or high consumption is the cause.

Editorial, Management, Balance of payments, Statistics, External debts

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The egg on Zedillo's face

Article Abstract:

Pres Zedillo's plan to prevent economic collapse and control inflation was delayed until Jan 3, 1995, almost two weeks after the peso crashed. He did achieve wage-rise limits from labor leaders and $18 billion in credit, but he needs to continue democratic reforms and privatization.

Prices and rates, Economic policy, Inflation (Finance), Zedillo, Ernesto, Peso (Mexico), Inflation (Economics)

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Free trade's virtues

Article Abstract:

The North American Free Trade Agreement must be ratified if Mexico is going to sustain the same rate of economic growth that they have had since 1987. Foreign investors may lose confidence and the country may be unable to modernize its industrial base.

Free trade

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