Word: baumohl
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Dates: during 1990-1999
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Indonesian President Suharto has only one reason for pegging the Indonesian rupiah to the U.S. dollar, says TIME Business Correspondent Bernard Baumohl: to bail out his relatives and cronies who have been quietly plundering the nation for decades. Suharto will likely set the rupiah-per-dollar rate at around 5,000 -- almost twice its current value, predicts Baumhohl. That gives his friends an opportunity to pay off their dollar debts in overvalued rupiah. "They'll save a fortune," says Baumhohl...
...rest of Indonesia, though, the move is financial poison. Pegging the rupiah to the dollar would only work if Indonesia's economy were "comparatively healthy--functioning banks, low inflation, low unemployment, like in the U.S.," says Baumohl. "Indonesia has none of those. It'll be a disaster...
...scenario then is predictable and crushing: Currency traders will take one look at the over-valued rupiah and exchange rupiah for U.S. dollars. "By pegging the rupiah," explains Baumohl, "Indonesia has promised to buy those rupiah with U.S. dollars--at the inflated price." Indonesia's reserves of foreign currency, vital to a nation's economic health, will quickly shrink. And traders, smelling more trouble, will dump even more rupiah, guaranteeing an economic meltdown. "In no time," says Baumohl, "the Indonesian government is bankrupt, and the economy collapses...
With Columbia/HCA posting a whopping $1.29 billion fourth quarter loss, while buyout firms are poised to plow a badly needed $600 million into Oxford, managed health care is looking anything but rosy for consumers. Says TIME writer Bernard Baumohl, the consequences could be either a rise in premiums or new mergers in the industry. "Either way, it's not going to be good news for consumers," says Baumohl. "Mergers will limit the range of choices in the industry, which could also ultimately push up premiums...
WASHINGTON: Corporate America will not be pleased with the price it may be asked to pay for restoring Democratic party unity: a $1-an-hour increase in the minimum wage over two years. But, says TIME business writer Bernard Baumohl, even in the unlikely event that the proposal is approved by Congress, business has little cause for alarm: ?There?s not much evidence to support the idea that increasing the minimum wage causes inflation ? the economy reacted well to the previous increase...