[drumhead]

Argentina did the same thing with their local currency tied to the dollar, it initially lowered inflation and a flow of capital came into their country and bringing higher growth. But then the capital kept flowing in because it was felt that they would never or could never break the link with the dollar. So the foreign debt piled up, and went inevitably into assets like property. When the Mexican default happened in the 90's all the money flowed out, the currency peg was broken and after the short deflation, inflation took over again. And thats the way its been.