to 5.8 MXN/USD four months later. Prices in Mexico rose by 24% over the same four months, and total inflation in 1995 was 52%. Mutual funds, which had invested in over $45 billion worth of Mexican assets in the several years leading up to the crisis, began liquidating their positions in Mexico and other developing countries. Foreign investors not only fled Mexico but emerging markets in general, and the crisis led to financial contagion throughout other financial markets in Asia and the Americas. The impact of Mexico's crisis in Chile and Brazil became known as the "Tequila effect" (). Bailout In January 1995, U.S. President Bill Clinton held a meeting with newly confirmed U.S. Treasury Secretary Robert Rubin, U.S. Federal Reserve Chairman Alan Greenspan and then-Under Secretary for the Treasury Larry Summers to discuss an American response. According to Summers' recollection of the meeting: Secretary Rubin set the stage for it briefly. Then, as was his way, he turned to someone else, namely me, to explain the situation in more detail and our proposal. And I said that I felt that was required, and one of the President’s political advisers said, “Larry, you mean .” And I said, “No, I mean .” ... There was a certain pall over the room, and one of his [Clinton's] other political advisers said, “Mr. President, if you send that money to Mexico and it doesn’t come back before 1996, you won’t be coming back after 1996.” Clinton decided nevertheless to seek Congressional approval for a bailout and began working with Summers to secure commitments from Congress. Motivated to deter a potential surge in illegal immigration and to mitigate the spread of investors' lack of confidence in Mexico to other developing countries, the United States coordinated a $50 billion bailout package in January 1995, to be administered by the IMF with support from the G7 and the Bank for International Settlements (BIS). The package established loan guarantees for Mexican public debt aimed at alleviating its growing risk premia and boosting investor confidence in its economy. The Mexican economy experienced a severe recession and the peso's value deteriorated substantially despite the bailout's success in preventing a worse collapse. Growth did not resume until the late 1990s. The conditionality of the bailout required the Mexican government to institute new monetary and fiscal policy controls, although the country refrained from balance of payments reforms such as trade