Suharto Living Dangerously

JAKARTA: Alarm bells are ringing in Washington after Indonesia's President Suharto continues to flout the terms set by the International Monetary Fund for rescuing his country's ailing economy. Suharto yesterday fired his Central Bank chief and moved closer to artificially propping up the rupiah by pegging it to the dollar, which analysts believe could bring economic collapse -- bad news for the region and for Wall Street.

In the short term, Suharto's gambit would save millions of dollars for the corporations run by his family and friends, but would soon knock the bottom out of the rupiah. "We could see the next round of Asian currency collapses," warns TIME business writer Bernard Baumohl. "Suharto is lighting a fuse that could detonate the entire region." The only mystery, says Baumohl, is the way a buoyant Wall Street continues to ignore it.