But, it's not all inevitable. Asian policymakers have their defences. The trick is to use these swiftly and convincingly. But, even then, no one size fits all; different countries require different weapons. To stem the dollar tide, policymakers need to choose their battle strategy wisely. Only a combination of responses, tailored to local circumstances, will work. The onslaught of cheap money, after all, will be with us for quite a while longer.

Textbooks always have easy answers. Raising interest rates is one. The trouble is that this only works with more flexible exchange rates. And these need to come first. In recent weeks, currencies have indeed started to move more convincingly, including the yuan.

But much more will need to follow to offset the powers of the Fed. Elsewhere, too, a combination of exchange rate appreciation and higher interest rates will prove effective.

The question, then, is what happens in Hong Kong: with its iron link to the US dollar, it is arguably Asia's most exposed economy to the vicissitudes of the US Federal Reserve.

Let's be clear. The peg will stay. It served the city well, and continues to do so. What else would there be? A basket, as some are suggesting, would hardly give the city the scope to raise interest rates at will. Unlike Singapore, moreover, which does use such a system, Hong Kong's economy does not export as many domestically produced goods. So allowing a gradual appreciation would not have the same dampening impact on demand. In fact, here, gradual appreciation would simply pour oil on the fire by drawing in yet more capital.

The other alternative, a free floating currency, which would provide the city with the ability to set interest rates, is hardly feasible. Hong Kong is simply too big a financial centre to have its currency whipped around by the daily whims of the market. In fact, it is the stability of the Hong Kong dollar, come rain or shine, that has helped propel the city into the first league of global financial hubs. Even so, its economy is too small, not least in proportion to local capital flows, for the exchange rate to be left fluttering in the wind.

What else is there? The gamut of choices runs far wider than mere interest and exchange rates. Fiscal policy stands out. If growth cannot be cooled by monetary means, it is the taxman who needs to step in. Running smaller deficits, or, in Hong Kong's case, larger surpluses, may help to dampen inflation and rein in exuberant expectations about growth. The latter, after all, are just as much responsible for rising asset prices as low interest rates. All this isn't easy: soaring living costs, understandably, lead to demands; the hardest-hit, of course, need to be helped.

But the tools of fiscal policy extend beyond mere subsidies. Taxes, for example, could be used to equal, if not greater effect. Consider a floating surcharge, applied in times of sharply rising incomes, but cut when things look less rosy. Often too simplistically, interest rates are seen as a tool for macroeconomic management. But they also have a tremendous distributive impact: when they fall, savers loose and investors gain. Temporary changes in tax might help to redress this imbalance. But note: this doesn't mean that the average tax burden will rise over time. It shouldn't. Rather, it only implies that tax rates vary over the cycle.

Another option is regulatory tightening. In Hong Kong, as elsewhere in Asia, this has already been used. More may be necessary. Yet, not all economies are suitable for this approach. In some cases, raising interest rates is preferable. After all, it is the cost of capital that largely drives activity. But, again, the hands of officials in Hong Kong are tied on this front. Luckily, efficient oversight renders this approach more effective here than elsewhere. Large-scale evasion of rules, despite a fundamentally low cost of capital, appears unlikely with Hong Kong's excellent supervisory institutions already in place.

The verdict, then, is clear. With the Fed on hold for much longer than Asia can bear, the region needs to hone its defences. The strategy will vary from economy to economy.

Hong Kong is a special case, with its currency board firmly in place. But other potent options are on the table: fiscal tightening, including a more active use of taxes, and regulatory tightening, which should work especially well in the city. In short, the Federal Reserve may have unleashed a flood of dollars, but Asian officials still have the tools to make sure the dam doesn't burst.

Frederic Neumann is managing director and co-head of Asian economics research at HSBC