Introduction
One of the cardinal features of money is stableness, nevertheless a currency crisis is said to happen when the value of a state ‘s currency becomes unstable and alterations quickly thereby sabotaging its ability to efficaciously function as a medium of exchange.
The Asiatic currency crisis was a period of fiscal meltdown which began in July 1997 and gripped the major proportion of East Asia. It remains one of the most talked about region-wide crisis in the 1990 ‘s, the sharpest to hit the development states, which resulted in a monolithic downward spiral of Asiatic economic systems hitherto seen as miracle economic systems and prompted the largest fiscal bailouts in history. ( Radelet and Sachs 1998 )
This paper will analyze the beginning of the crisis, its impact on the economic systems of the states involved and the steps that have been adopted to avoid a return of a similar crisis.
ORIGIN OF THE CRISIS
Upon common understanding, based on the place agreement ( 1985 ) between the US, Germany and Japan, the US dollar was devalued by about 60 % to the Hankering in existent footings in order to relieve the increasing US current history shortage. Nipponese houses confronting export fight due to the grasp of the Yen began to travel production to south East Asiatic states whose currencies were pegged to the dollar. This provided an ideal location for the Nipponese houses in footings of international monetary value competiveness. This influx of investing from Japan to the South East Asiatic states accelerated a form that led to big influx of capital from other Asiatic and foreign states into the East Asiatic states. The fixed exchange rate system gave the south East Asiatic economic systems strong exports, low import monetary values and expected fiscal stableness.
For old ages, East Asiatic Countries were held up as economic icons. Their typical blend of high nest eggs and investing rates, bossy political systems, export-oriented concerns, restricted domestic markets, authorities capital allotment, and controlled fiscal systems were hailed as the ideal formula for strong economic growing of developing states ( Shapiro 1999 ) . Asiatic economic systems like Taiwan, Hong Kong, Korea, Singapore and Thailand enjoyed overall mean growing rates of 5.6 per centum, 6.6 per centum, 7 per centum, 6.9 per centum and 4.6 per centum severally for several decennaries. Indonesia and Malaysia excessively enjoyed good economic public presentation during most of the 1970s and 1980s. ( Rao, 1998 )
However, these “ miracle economic systems ” were brought down in July 1997 when a brewing currency crisis started from Thailand. This seed of the Asiatic currency crisis of 1997 were really sown during the old decennaries when these states were sing unprecedented economic growing. For long, exports had long been the engine of economic growing in these states and as such many Asiatic provinces were regarded as “ Export Power Houses ” . The increased foreign capital influx into these economic systems besides propelled capital outgo which led to an investing roar in commercial and residential belongingss, industrial assets and substructure. These capital outgos were financed by heavy adoptions from Bankss which had extra liquidness but no strong regulative models. Therefore, by the mid 1990s, South East Asia was sing an unprecedented investing roar, much of it financed with foreign investings and adoptions. The instance was made worse as much of the foreign adoptions had been in US dollars as opposed to local currencies. At the clip, this had seemed like a smart move ( i.e. regional local currencies were pegged to the dollar and involvement rates on dollar adoptions were by and large lower than rates on adoptions in domestic currency, and it made economic sense to borrow in dollars if the option was available ) ; but, many of the investings made with these financess were on the footing of projections about future demand conditions that were unrealistic.
Soon, there were indicants of macroeconomic instabilities in the Thai economic system ; the existent exchange rate had risen to an seemingly unsustainable degree and the current history was besides in changeless immense shortage. Rao ( 1998 ) . Besides, Asiatic Countries started to see their ballooned volume of investings during the 1990s worsening significantly. Paul krugman ( 1999 ) stated the Asiatic states attracted so much foreign capital that their economic growing was fuelled more by sheer volume of investing instead than by the productiveness of those single investings. Therefore the authoritiess in the part could non keep their dollar nog and their currencies started to deprecate against the dollar, this increased the size of the debt load that needed to be serviced when measured in local currency. This started the debt roar.
A concluding complicating factor was that by 1996, there became a relaxation of export growing which was much noticeable in Korea, Malaysia, Singapore and Taiwan, while in Thailand there became a diminution in the dollar value of exports. This diminution in export did non halt turning import and this disparity saw many south Asiatic states switching strongly into the “ ruddy ” during the mid 1990s. By 1995, Indonesia was running a current history shortage that was tantamount to 3.5 % of its Gross Domestic Product ( GDP ) , Malaysia ‘s was 5.9 % and Thailand ‘s was 8.1 % . With shortages like these get downing to stack up, it was going progressively hard for the authoritiess of these states to keep the nog of their currencies against the U.S dollar.
Therefore by 1997, the first obvious indicant of the crisis started with the Thai economic system. Thailand could no longer support their currency and hence floated the tical on the 2nd of July 1997. ( Rao, 1998 ) . Prompted by these developments in Thailand, investors saw fundamentally the same issues confronting Thailand surfacing in other neighbouring states. As a consequence, investors panicked ; their frights were non allayed particularly because of deficiency of transparence sing issues such as the extent of authorities and private debt, the wellness of the fiscal sectors and no trust in the authorities to take preemptive disciplinary actions. This led to monolithic capital flight. The backdown of foreign currency led to dramatic depreciation in exchange rate and higher involvement rates. This led to an addition in the figure of non-performing loans, doing an eroding of the market value capital of most of the states. Therefore, the scene was now set for a possible rapid economic dislocation.
There is no consensus on the exact beginning of the currency crisis in East Asia ; while some schools of idea believe that the crisis was caused by the initial fiscal convulsion in some Asiatic states, followed by regional contagious disease ( Radelet and Sachs, 1998 ; Marshall, 1998 ; and Chang and Velasco, 1999 ) , others believe it occurred as a consequence of policy and structural deformations ( Corsetti, Pensetti and Roubini ; 1998 ) . However, most of the East Asiatic economic systems were mutualist, hence it was merely logical that a crisis in one would hold a domino-effect and unwittingly do a crisis in other East Asiatic Economies that were linked to it.
Warning Signals during the 24 Months prior to the 1997 Asiatic Financial Crisis, Months of Lead Time, and Performance Measures.
Number of Warning Signals and Months of Lead Time ( in parenthesis )
Optimal threshold percentile
Dutch east indies
Korea
Malaya
Filipino
Siam
Singapore
Noise to signal ratio
Conditional crisis chance
( % )
Share of crisis predicted
( % )
Overall Composite Index
88
7 ( 11 )
9 ( 10 )
13 ( 13 )
10 ( 11 )
10 ( 10 )
0 ( 10 )
0.137
77
83
Current History
90
7 ( 11 )
11 ( 16
13 ( 13 )
11 ( 11 )
16 ( 16 )
0 ( 0 )
0.136
77
83
Capital History
90
1 ( 23 )
0 ( 0 )
2 ( 3 )
0 ( 0 )
0 ( 0 )
0 ( 0 )
0.288
62
63
Financial Sector
90
0 ( 0 )
0 ( 0 )
2 ( 3 )
0 ( 0 )
0 ( 0 )
0 ( 0 )
0.313
60
67
Real Sector
90
2 ( 2 )
9 ( 14 )
0 ( 0 )
2 ( 10 )
4 ( 13 )
0 ( 0 )
0.322
53
31
Global Economy
80
0 ( 0 )
0 ( 0 )
0 ( 0 )
0 ( 0 )
0 ( 0 )
0 ( 0 )
0.540
46
75
Fiscal Sector
87
0 ( 0 )
0 ( 0 )
0 ( 0 )
0 ( 0 )
0 ( 0 )
0 ( 0 )
0.540
46
46
Beginning: ERD Working Paper No.26
Using a Signalling attack based EWS theoretical account, it shows that relentless warning signals prior to the 1997 crisis was non merely in a few but all of the five states most affected by the crisis. The findings of this theoretical account supports the fact weaknesses in economic and fiscal basicss in these states triggered the crisis.
The Impact of the crisis on the Economicss of the states involved.
As Thailand floated the tical on July 2 and allowed the currency to fall, beckon after moving ridge of guess hit other Asiatic currencies, a de-facto devaluation of the Philippine Peso followed on July 11. Korean Won excessively lost. Malaysia let its currency, the ringgit float on July 14th 1997, as foreign exchange militias had gone down to $ 28 billion. Singapore followed on July 17th and the Singapore dollar ( S $ ) rapidly dropped in value from $ 1 = S $ 1.495 prior to the devaluation to $ 1 = 2.68 a few yearss subsequently. A month subsequently on August 14, Indonesia floated the rupiah. This was the beginning of a hasty diminution in the value of the Indonesian currency as a autumn was seen from $ 1 = 2,400 Rupiah in August 1997 to $ 1 = 10,000 Rupiah on January 6th, 1998, a loss of 75 % ( Rao, 1998 ) .
Beginning: DataStream
The Chart ( above ) shows the monthly development of the currencies of the eight South-East Asiatic states during the crisis from July 1997 to April 1998. The Five states where the crisis where peculiarly serious ( Figure 1A ) saw more diminution in their currencies than states in Figure 1B even though all states shown were affected.A
The economic system of Thailand where the crisis started from suffered a existent crisp diminution. Entire export net incomes declined and a trade shortage rose to $ 16 billion. With the shortage standing at over 8 per centum of GDP and its funding mostly coming from short term financess ; the external debt of Thailand rose to $ 68.1 billion. The non-performing loans of Bankss and finance companies in Thailand were estimated to be about 12 per centum of entire loans in mid 1997. The Thailand economic system was besides plagued by a deteriorating external sector, a stock market diminution ( the stock market index fell from 1683 in 1993 to below 500 in1997 ) and most significantly dwindling forex militias. A diminution in investing saw the closing of investing houses which resulted in immediate unemployment rates of between 6 and 10 per centum ( Rao, 1998 ) .
The Indonesian economic system besides suffered a setoff which included turning current history shortages due to lack-luster export growing and mounting debt service. Loss of assurance in Indonesia led to a series of onslaughts on the currency. In the 2nd half of 1997, the rupiah fell by 72 per centum against the dollar which had an inauspicious consequence on the Nipponese, European and US Bankss that lent one million millions of dollars to Indonesian companies. Harmonizing to Witcher ( 1998 ) , “ the Indonesia ‘s fiscal system started to reel under intensifying bad loans ” . Indonesia sought aid from the IMF, they agreed to supply them with loans estimated at $ 40billion and in return demanded that Indonesia keeps involvement rates high and instantly close 16 Bankss.
The intelligence of bank closings led to panicked backdowns by depositors and investors. As Stiglitz ( 1998 ) and Yellen ( 1998 ) discussed ; due to limited information, investors were unable to separate which Bankss were healthy or non so they shied off from them all ; this caused more mayhem to the economic system. The crisis rapidly spread to the existent sector. The existent gross domestic merchandise ( GDP ) contracted by 13 % in 1998 and remained stagnant in 1999. Real end product declined by about 14 % in 1998. The Indonesian economic system therefore went into a recession with falling GDP in 1998. It besides had a weak economic system that was composed of falling domestic demand and company closings which meant lifting poorness and unemployment. . Unemployment which was historically no more than 3 to 4 per centum hit a 10 per centum degree in 1998 with around 8.7 million people idle. The impact of the crisis on public assistance and the economic system as a whole was largely reflected in the poorness rate which rose from 15 % in 1997 to 33 % in 1998.
The contagious disease consequence shortly caught up with South Korea, a state whose economic public presentation was dramatic compared to other Asiatic states. However, the won began to deprecate from late August 1997 and gathered impulse by October. From about 900 won to the dollar in early August, the exchange rate plummeted to about 1200 by the terminal of November. The ratio of debt militias rose during 1992 – 1997 ( Rao, 1998 ) . In January 1997, Hanbo Steel collapsed under a $ 6 billion debt. This was the first Korean ‘Chaebol ‘ to travel bankrupt in 10 old ages ( Chang,1998 ) . In the aftermath of this, the Korean portions declined in value by 25.2 % at the terminal of 1997. Balance in trade declined from a excess of $ 7.6billion in 1987 to a shortage of $ 20.6billion in 1998. GDP per capita fell and Unemployment rate of course rose to 5.9 per centum in February 1998 and started to mount up from at that place ( Rao, 1998 ) .
The Philippines Economy faced a important currency crisis, the peso fell significantly from 26/US $ to even 55/US $ . The GDP growing rate dropped from 5.1 % in 1997 to -0.5 % in 1998. GNP hovered at 0.1 % in 1998 compared to 7.2 % in 1996 and by the 4th one-fourth of 1998, growing of investings had declined to -23.9 % .
In Hong Kong, the economic system saw the prostration of the Hong Kong ‘s stock market ( with a 40 per centum loss in October ) . On October 27 1997, the market mob on Wall Street was preceded by a 5.8 per centum dip in the Hong Kong stock market which snowballed through the universe ‘s developed and emerging stock markets. Most markets in the Asia-Pacific part tumbled in understanding, with Australia down 3.4 per centum and Tokyo down 1.9 per centum.
Below is a graph demoing the development of the Asiatic stock markets during the fiscal crisis of 1997- 1998.
Beginning: Morgan Stanley International Capital ( MSCI ) .
Figures 2A and 2B ( above ) show the monthly development of national stock monetary value indices ( expressed in US dollars ) for these same eight states and during the same period of clip. The determination shows a consistent stopping point relationship between exchange rate depreciations and stock returns during the crisis. ( Bailey, Chan and Chung ( 2001 ) . )
Japan was besides affected because its economic system is outstanding in the part. Asiatic states normally run a trade shortage with Japan because the latter ‘s economic system was more than twice the size of the remainder of Asia together ; about 40 per centum of Japan ‘s export go to Asia. However, even with this, the Japanese was eventually shaken as their hankering fell to 147 when mass merchandising began ; Besides, with the prostration in the value of the Nipponese stock market, the value of assets besides plummeted, go forthing the establishments with a lessened plus base and an increased portfolio of non-performing loans. The GDP existent growing rate slowed dramatically in 1997, from 5 % to 1.6 % and even sank into recession in 1998.
In a comparatively short period of clip, the crisis currency crisis daze was spread even beyond Asia. The USA market ( the Dow Jones industrial ) plunged 554 points or 7.2 % . The New York Stock Exchange briefly suspended trading ; this was accompanied by dips of 15 per centum in Brazil, 13.7 per centum in Argentina and 13.3 per centum in Mexico.
Europe besides had the impact of contagious disease effects, Markets like London fell 2.6 per centum, while Germany, France and Italy all shed 2.8 per centum. Smaller markets like Finland plunged 5.7 per centum, while Spain skidded 4.1 per centum.
Russia became the major non-Asian victim of the fiscal contagious disease. By mid 1998, investors began to comprehend systematic failings of the Russian economic system which was similar to Asia ; hence they began a steady backdown of their capital from the economic system. By summer solstice 1998, it became evident that Russia was fighting to keep an exchange of approximately 6 rubles to 1 dollar at the clip. Their cardinal bank militias began to dwindle. Despite the loan bundle and the pro-market disposal, the international investing community lost religion in Russia and rushed for the issues. On August 15th 1998, the debris was allowed to drift and the Russian stock market lost 25 % of its value.
The Measures that have since been adopted to avoid return of a similar crisis.
After the slow down of the Asiatic Currency Crisis of 1997, the part ‘s former economic Liberation Tigers of Tamil Eelams had to mete out some conditions and policies towards a sustainable Asiatic economic system that would be able to defy any fiscal convulsion and accordingly avoid the return of a similar crisis. These parts ‘s heavy weight besides had to accept the International Monetary Fund ( IMF ) conditions in order to remain afloat – although the IMF had ne’er dealt with a crisis of this magnitude and was met with stiff belligerencies ; the IMF prescribed tough conditions and steps that contributed vastly to considerable long term additions for the Asiatic Economics ( Lakhan, 2007 )
One of these conditions were policies affecting the Macro-economy. The tightening of pecuniary policy ( at different phases in different states ) was necessary to stem exchange fluctuation, to forestall currency depreciation from taking into a spiral of rising prices and into the eventual prostration of the exchange rate. Some states like Thailand, South Korea, Philippines and Indonesia switched to improved believable policies that involved their exchange rate system. These states adopted the “ rising prices aiming ” policy which implied greater transparence and answerability alternatively of exchange rate as an ground tackle for pecuniary policy. Inflation aiming besides allowed for the attainment of stable development of their economic system through the constitution of believable and reputable cardinal bank ; as these cardinal Bankss set rising prices marks and enforced pecuniary policies committed to the accomplishment of marks. They besides made pecuniary policy determinations based on overall opinion of the economic system by maintaining changeless ticker non merely on immediate monetary value motions but besides on tendencies of demand and supply factors in the domestic economic system, exchange rate motions and overall motion of the international economic system. The effects from this policy adopted – rising prices aiming – contributed mostly to stabilising the pecuniary and economic environment after the currency crisis ( Tomoko, 2002 ) . A typical illustration could be seen in South Korea.
After the Crisis, South Korea revised the Bank of Korea act to present rising prices aiming in 1998. Since its debut, South Korea ‘s rising prices targeting has played an appreciable function in stabilising the state ‘s economic system. In peculiar, the debut of rising prices aiming has secured the independency of the Bank of Korea in pecuniary policy and drastically enhanced the transparence of pecuniary policy.
Affected states of the crisis besides embarked on their fiscal system stabilisation to avoid any similar return of the enfeebling fiscal crisis. These steps ventured into the countries of liquidness support for troubled Bankss in inquiry, sedimentation protection measures through a sedimentation insurance co-operation to forestall systemic hazard originating from the spread of recognition edginess, hiking capital base through capital injections from public financess and prompt disposal of non-performing loans by a 3rd party organisation – ( Resolution and Collection Company in the instance of Japan and plus direction companies ( AMC ) in the instance of Asiatic states ) . The four states where the fiscal crisis was peculiarly serious ( Thailand, South Korea, Malaysia and Indonesia ) injected public financess into fiscal establishments – frequently with authorities aid. They besides went into the act of advancing the consolidation of fiscal establishments by shutting or suspending operations of Bankss with dubious opportunities of endurance, temporarily nationalising them or unifying them. They established an plus direction company to buy non-performing loans – Thai Asset Management Corporation ( TAMC ) in Thailand, Danaharta in Malaysia, Korea Asset Management Company ( KAMCO ) in South Korea, and Indonesian Bank Restructuring Agency ( IBRA ) in Indonesia ( Lindgren et al, 2000 )
Although the system of the companies or organisations varied from one state to another, they all likewise purchased non-performing loans at about market monetary values and disposed the assets selling by stamp or by agencies of securitization. At present, they have disposed of approximately 50~70 % of the assets. Thailand for illustration, had finance companies ( non-banks ) that had been enduring from concern troubles even before the currency crisis and the Thai authorities had been supplying liquidness support to them. After the crisis, the authorities improved its categorization criterion for non-performing loans to conform to the international criterion and strengthened write-down criterions. It besides nationalized commercial Bankss, injected capital and reorganized them. As a consequence, the figure of commercial Bankss decreased. Thai commercial Bankss ‘ non-performing loan besides subsequently decreased dramatically due to understandings on debt restructuring every bit good as transportation of non-performing loans to the TAMC and write-downs. As a consequence, the non-performing loan ratio dropped to 19.2 % as of the terminal of March 2001 and capital adequateness ratio stood at 12.01 % as of December 2000 ( A ratio higher than the BIS criterion ) ( Montes, 1998 ) .
Structural reforms were besides adopted in the countries of banking supervising and ordinance in order to prevent the sort of fiscal system instability caused by the crisis and to minimise the consequence. These reforms were besides necessary to turn to the failings in the fiscal and corporate sector as these characteristics had become hindrances to growing such as monopolies, trade barriers and non – crystalline corporate patterns. Based on this acknowledgment, the IMF and the World Bank jointly began supervising the international standardisation and observation of criterions to keep the soundness of fiscal systems by presenting the Financial Sector Assessment Program ( FSAP ) in 1999. Under FSAP, the IMF and the World Bank assess the observation of banking supervising and ordinances implemented by each state ‘s fiscal supervisory governments, promote observation of international criterions, and urge the best patterns. These Acts of the Apostless which have been entrenched in continue to globalise the Asiatic economic system ( Lindgren et al, 2000 ) .
Rehabilitative steps were besides extended to private corporations and fiscal establishments in the Asiatic states as these establishments were besides hit by the currency crisis mostly because they had a superficial apprehension of the demand for exchange hazard hedge, as their currencies were virtually pegged to the dollar. It was for this ground that the debt loads caused by the mismatch of currencies increased during the crisis, conveying a serious impact on the economic system as a whole. Therefore after the currency crisis, there was a displacement to a floating exchange rate system and this pushed private corporations into acknowledging the importance of fudging against exchange hazards. In South Korea, the authorities conducted a run appealing for the demand for exchange hazard hedges. Some other states established a fiscal supervising system to look into if foreign currency-denominated debts are hedged against exchange hazards. Thankss to these policy attempts, the figure of private corporations fudging against exchange hazards increased drastically and the response capablenesss of the economic system as a whole to interchange fluctuations have been strengthened ( Lindgren et al, 2000 ) .
A stronger and incorporate Regional Financial and Multilateral Co-operation in East Asia was besides adopted and this has proven to be an effectual buffering against the happening of future crisis – Although regional fiscal cooperation in East Asia did be even before the crisis, such as Executives ‘ Meeting of East-Asia Pacific Central Banks ( EMEAP ) , a forum of cardinal Bankss and pecuniary governments in the East Asia and Pacific part established in 1991 ; the event of the Asiatic currency crisis proved more blazing that the states in East Asia had a much more economic mutuality than was antecedently realized. This forced a fosterage of a much stronger regional fiscal and many-sided cooperation. This co-operation in Asia was promoted in assorted signifiers, such as the “ New Miyazawa Initiative ” integrating a comprehensive support steps, including a 30 billion dollar fiscal support strategy, announced in October 1998 ; the Chiang Mai Initiative ( CMI ) , a barter agreement mechanism to back up those states in possible danger of a currency crisis and the Asiatic Bond Market Initiative ( ABMI ) to avoid high dependance on the external fiscal market and utilize regional resources more expeditiously ( Naoyuki Yoshino et Al, 2000 )
In add-on to the development of a regional crisis-prevention mechanism, Asiatic states started to co-operate particularly in trade dealingss. This unwittingly resulted in a much more stable policy for exchange rates between the Asiatic currencies. With the increased fusion that came as a consequence of the push for a stronger and incorporate regional fiscal and many-sided co-operation in East Asia, there became a lifting sense of Asiatic individuality climaxing into the guess of an debut of a regional common currency in the hereafter ( Naoyuki Yoshino et Al, 2000 ) .
The finance curates of China, Japan, and Korea agreed at the ASEAN+3 Finance Ministers Meeting in 2006 to carry on joint research on pecuniary integrating in East Asia. The gesture put frontward in 2006 helped to make evidences for the much talked about “ China ‘s planetary scheme attack ” which started doing caput manner in 2010. Now, China is get downing to emerge as the new and dominant universe power, buttressing this, is the recent widespread consciousness and circulation of the Chinese currency ( renminbi ) . These co-operation steps adopted in Asia besides extended as a forum for economic co-operation ( such economic co-operation was seen to be displayed in the widely credence of the Chinese currency “ renminbi ” by the other Asiatic states ) . This economic co-operation by these Asiatic states arguably challenges the American hegemony. It besides proves a strong force towards the riddance of any future fiscal crisis that might happen as the enterprises and treatments on escalating pecuniary and fiscal cooperation has reached a far – terminal spectrum ( Naoyuki Yoshino et Al, 2000 ) .
From 1996 – 2000, there have been a revival of economic growing across the Asiatic part. States like Indonesia, Thailand, Malaysia, South Korea and the Philippines have averaged about 5 % .
CHARTS SHOWING THE EFFECT ON THE AFFECTED COUNTRIES AFTER THE MEASURES HAVE BEEN ADOPTED.
From the chart above, it can been seen that after the rehabilitative steps were meted out, corporate balance sheets in Asia improved as debt-to-equity ratios have been reduced aggressively and foreign currency adoption is no longer a big constituent of the corporate beginnings of support.
From the chart above, it can be seen that low loan-to-deposit ratios together with small off-balance-sheet funding, have helped Bankss avoid liquidness and support emphasis in the current recognition convulsion. Therefore, Banks are stronger with current history excesss and big foreign militias.
Compared to United States and many European states, Asiatic economic systems have comparative modest belongings monetary value grasp ( see Chart 5 ) . Asiatic states have taken steps to chill belongings markets in recent old ages whenever monetary values threatened to go a bubble. As a consequence, belongings monetary value clangs in the aftermath of decelerating economic growing and fiscal market convulsion have been less of a hazard.
Decision:
Although, the Asiatic currency crisis was fuelled by sheer weak economic and fiscal basicss including macro- economic instabilities, which created a contagious disease consequence for the other states involved.
However, with the steps now adopted, it is obvious that the Asiatic economic systems have now been strengthened and would go on on that way.
