But with a significant part of short-term liabilities, bank and nonbank, denominated in foreign currencies (predominantly dollars), unhedged, the initial pressure on domestic currencies led to a sharp crack in the fixed exchange rate structure of many East Asian economies. The belief that local currencies could, virtually without risk of loss, be converted into dollars at any time was shattered.
Thaler, R.H. and Sunstein, C.R., “Nudge: Improving Decisions about Health, Wealth and Happiness.” New Haven and London: Yale University Press, 2008.