A particular form of boom and bust cycle is generated by the end of hyperinflationary episodes (Bolivia, 1986);  BIS Review 9/2005  1  •  Wholesale liberalization in the absence of an appropriate and effective prudential regulatory framework (Mexico, 1994; and Chile, 1984).
It is worth stressing, however, that highly regulated systems have also suffered crises (Peru, 1987);  •  Direct effects of fiscal difficulties on the domestic banking system, a factor that seems to have become an increasingly important source of strain on Latin American banks (Argentina, 2001);  •  Contagion and spillovers, where a crisis in one country induces economic agents to reassess their expectations and thus reduce investment in other countries (Argentina, 1995), or where a crisis in one country has a direct effect on economic conditions in another country (Uruguay, 2001);  •  Terms of trade shocks and movements in real exchange rates (Venezuela, 1994; and Ecuador, 1998); and  •  Political instability, unrest, and, in some cases, civil conflict.