Identifier
Created
Classification
Origin
08SEOUL2427
2008-12-18 05:28:00
UNCLASSIFIED
Embassy Seoul
Cable title:
MEDIA REACTION IN SEOUL
how-toR 180528Z DEC 08 FM AMEMBASSY SEOUL TO SECSTATE WASHDC 2677 USDOC WASHDC 7909 DEPT OF TREASURY WASHDC AMEMBASSY TOKYO AMEMBASSY MOSCOW AMEMBASSY BEIJING CIA WASHINGTON DC SECDEF WASHINGTON DC USCINCPAC HONOLULU HI
UNCLAS SEOUL 002427
STATE FOR EAP/PD FOR SWALKER, EAP/P, EAP/K
STATE PASS USDA ELECTRONICALLY FOR FAX/ITP SCHEIKH
STATE PASS USTR FOR RCASSIDY
USDOC FOR 4430/IEP/OPB/EAP/JDONIUS
TREASURY FOR OASIA/MGREWE
CINCPAC FOR J-74
E.O. 12958: N/A
TAGS: PGOV PREL MARR ECON KS US KPAO KMDR
SUBJECT: MEDIA REACTION IN SEOUL
Subject: Media Reaction; Seoul
Global Economy: Financial Market Crisis
"Fed Cuts Rate to Zero to Fight a Deepening Recession"
Conservative Chosun Ilbo editorialized (12/18): "The Federal
Reserve's decision (to cut its key interest rate to a record low
range of between zero percent and 0.25%) is a radical measure that
is tantamount to printing dollars and scattering them from
helicopters. If it works well, the action could dramatically rescue
the U.S. economy from a deepening recession. However, if the
increased liquidity stokes inflation and weakens the dollar, it
might prompt foreign investors to sell off their dollar assets en
masse, putting an end to the long status of the dollar as the
world's default currency. Furthermore, the Fed has now become the
largest lender in the U.S. due to the financial crisis. This is the
result of its bailouts of financial institutions and purchases of
commercial paper (CP) to offer rescue measures. Even if the U.S.
economy recovers, it is questionable whether the Fed will be able to
handle the shock when it collects those loans."
Stephens
STATE FOR EAP/PD FOR SWALKER, EAP/P, EAP/K
STATE PASS USDA ELECTRONICALLY FOR FAX/ITP SCHEIKH
STATE PASS USTR FOR RCASSIDY
USDOC FOR 4430/IEP/OPB/EAP/JDONIUS
TREASURY FOR OASIA/MGREWE
CINCPAC FOR J-74
E.O. 12958: N/A
TAGS: PGOV PREL MARR ECON KS US KPAO KMDR
SUBJECT: MEDIA REACTION IN SEOUL
Subject: Media Reaction; Seoul
Global Economy: Financial Market Crisis
"Fed Cuts Rate to Zero to Fight a Deepening Recession"
Conservative Chosun Ilbo editorialized (12/18): "The Federal
Reserve's decision (to cut its key interest rate to a record low
range of between zero percent and 0.25%) is a radical measure that
is tantamount to printing dollars and scattering them from
helicopters. If it works well, the action could dramatically rescue
the U.S. economy from a deepening recession. However, if the
increased liquidity stokes inflation and weakens the dollar, it
might prompt foreign investors to sell off their dollar assets en
masse, putting an end to the long status of the dollar as the
world's default currency. Furthermore, the Fed has now become the
largest lender in the U.S. due to the financial crisis. This is the
result of its bailouts of financial institutions and purchases of
commercial paper (CP) to offer rescue measures. Even if the U.S.
economy recovers, it is questionable whether the Fed will be able to
handle the shock when it collects those loans."
Stephens