that the initial loss of confidence was small and that, at least in fall almost every emerging market was affected (International Monetary Fund, 1997) It is possible that the shock was larger in countries with weaker institutions for reasons that are unrelated to institutions. However, there is no evidence of such a pattern to the shock. The anecdotal evidence suggests that there was a small loss of investor confidence that began in Thailand, spread through Asia, and then suddenly included other emerging markets, marked by a surprising sell-off in Hong Kong from October 1997. By November 1997 there had been some small loss of confidence or questioning of future prospects in almost all emerging markets