LATIN POLICY ADJUSTMENT URGED BY CEA'S SPRINKEL
Council of Economic Advisers
Chairman Beryl Sprinkel called on Latin American governments to
adopt sounder economic policies and said U.S. banks' loans to
those countries had already been written down in an economic
sense.
    "Latin governments will have to adopt policies that promote
growth for their own citizens," he said, adding that the record
has been mixed.
    Brazil, he said, recently has backtracked from better
economic policies and "obviously they have to change."
    Asked if U.S. banks ultimately would be forced to write
down portions of their loans to Latin America, Sprinkel said,
"In any realistic sense, economic sense, those loans have been
written down."
    The banks could not sell the loans at par, he said, and the
price/earnings ratio of major banks' stocks has not been doing
very well.
    "Clearly the lenders have suffered," said Sprinkel.
 Reuter
