It would pose a big problem for Argentina, whose currency is tied tightly to the dollar, but Mr. Sachs says dozens of other lands shouldn't be forced into deep recessions to preserve fixed exchange rates in two places, Argentina and Hong Kong. Mr. Stiglitz, because his World Bank post means that his words are likely to be misconstrued as official policy, is hesitant to dispense much public advice. He has noted that Brazil's budget deficit looks large primarily because its economy has slowed and interest rates are so high. And he has argued that if Brazil, given its strengths and the commitment of its leaders, can't fend off the market onslaught, then the structure of the international financial system needs to be rethought. Other economists scoff at the three men's depiction of Brazil as victim.
Brazil talks the right talk and does the opposite.
The IMF has to be extra tough. But he has become a pundit, seeking to influence opinion with trenchant and sometimes-acerbic essays, all of which are posted on his Web site. An early skeptic of the Asian economic miracle, Mr. Krugman suggested in 1994 there was no magic formula in Asia, just lots of sweat and capital. But he concedes he never imagined the sudden end to prosperity that has occurred. The basic problem, he reasons, is that investors are now much freer to put money in and pull it out of emerging markets.