Four years have passed since the onset of the 2008 global crisis, and although some believe that there may be a second down draft soon, attention has shifted from crisis narration to assessing ...lessons essential for preventing or managing recurrences. The exercise is worthy, but there is always the danger of preparing for the last war when the next attack takes another form. Prevention and Crisis Management addresses this problem by highlighting the future threat to Asia from a broader perspective that takes account of the Japanese and Asian financial crises during the 1990s as well as the global crisis of 2008. The enlarged framework turns out to be illuminating for two distinct reasons. First, it reveals that Asian crises take many diverse forms, and second, the solutions devised to date have only been locally and not universally effective. Policymakers are accordingly advised to always plan for the element of surprise.Sample Chapter(s)Introduction (40 KB)Chapter 1: Asian Currency and Financial Crises in the 1990S (99 KB)Contents:Crises 1990-2010:Asian Currency and Financial Crises in the 1990s (Steven Rosefielde and Assaf Razin)The 2008-2009 Global Crisis (Steven Rosefielde and Assaf Razin)Crisis in Transitioning Countries (Yoji Koyama)PIIGS (Steven Rosefielde and Assaf Razin)Global Default (Steven Rosefielde and Daniel Quinn Mills)Prevention:Prevention and Counter-Measures (Torbjörn Becker)Threats and Deterrents:Global Imbalances (Huan Zhou and Steven Rosefielde)Chinese Protectionism (Jonathan Leightner)China's Economic Future (Akio Kawato)Optimal Asian Dollar Surplus (Eric Fisher)Toward an East Asian Economic Community (Yun Chen and Ken Morita)Asian Union (Steven Rosefielde, Jong-Rong Chen and Masumi Hakogi)Buddhist Crisis Prevention and Management (Teerana Bhongmakapat)Readership: Researchers, academics, graduates and general public who are interested in Asian economies, globalization, macroeconomics and international economics.
When Washington Shut Down Wall Streetunfolds like a mystery story. It traces Treasury Secretary William Gibbs McAdoo's triumph over a monetary crisis at the outbreak of World War I that threatened ...the United States with financial disaster. The biggest gold outflow in a generation imperiled America's ability to repay its debts abroad. Fear that the United States would abandon the gold standard sent the dollar plummeting on world markets. Without a central bank in the summer of 1914, the United States resembled a headless financial giant.
William McAdoo stepped in with courageous action, we read in Silber's gripping account. He shut the New York Stock Exchange for more than four months to prevent Europeans from selling their American securities and demanding gold in return. He smothered the country with emergency currency to prevent a replay of the bank runs that swept America in 1907. And he launched the United States as a world monetary power by honoring America's commitment to the gold standard. His actions provide a blueprint for crisis control that merits attention today. McAdoo's recipe emphasizes an exit strategy that allows policymakers to throttle a crisis while minimizing collateral damage.
When Washington Shut Down Wall Streetrecreates the drama of America's battle for financial credibility. McAdoo's accomplishments place him alongside Paul Volcker and Alan Greenspan as great American financial leaders. McAdoo, in fact, nursed the Federal Reserve into existence as the 1914 crisis waned and served as the first chairman of the Federal Reserve Board.
Why Not Default? Roos, Jerome E
2019, 20190212, 2019-02-12
eBook
How creditors came to wield unprecedented power over heavily indebted countries-and the dangers this poses to democracy
The European debt crisis has rekindled long-standing debates about the power of ...finance and the fraught relationship between capitalism and democracy in a globalized world.Why Not Default?unravels a striking puzzle at the heart of these debates-why, despite frequent crises and the immense costs of repayment, do so many heavily indebted countries continue to service their international debts?
In this compelling and incisive book, Jerome Roos provides a sweeping investigation of the political economy of sovereign debt and international crisis management. He takes readers from the rise of public borrowing in the Italian city-states to the gunboat diplomacy of the imperialist era and the wave of sovereign defaults during the Great Depression. He vividly describes the debt crises of developing countries in the 1980s and 1990s and sheds new light on the recent turmoil inside the Eurozone-including the dramatic capitulation of Greece's short-lived anti-austerity government to its European creditors in 2015.
Drawing on in-depth case studies of contemporary debt crises in Mexico, Argentina, and Greece,Why Not Default?paints a disconcerting picture of the ascendancy of global finance. This important book shows how the profound transformation of the capitalist world economy over the past four decades has endowed private and official creditors with unprecedented structural power over heavily indebted borrowers, enabling them to impose painful austerity measures and enforce uninterrupted debt service during times of crisis-with devastating social consequences and far-reaching implications for democracy.
At the beginning of the 1990s, a massive speculative asset bubble burst in Japan, leaving the nation's banks with an enormous burden of nonperforming loans. Banking crises have become increasingly ...common across the globe, but what was distinctive about the Japanese case was the unusually long delay before the government intervened to aggressively address the bad debt problem. The postponed response by Japanese authorities to the nation's banking crisis has had enormous political and economic consequences for Japan as well as for the rest of the world. This book helps us understand the nature of the Japanese government's response while also providing important insights into why Japan seems unable to get its financial system back on track 13 years later.
The book focuses on the role of policy networks in Japanese finance, showing with nuance and detail how Japan's Finance Ministry was embedded within the political and financial worlds, how that structure was similar to and different from that of its counterparts in other countries, and how the distinctive nature of Japan's institutional arrangements affected the capacity of the government to manage change.
The book focuses in particular on two intervening variables that bring about a functional shift in the Finance Ministry's policy networks: domestic political change under coalition government and a dramatic rise in information requirements for effective regulation. As a result of change in these variables, networks that once enhanced policymaking capacity in Japanese finance became "paralyzing networks"--with disastrous results.
This volume argues that the crisis of the European Union is not merely a fiscal crisis but reveals and amplifies deeper flaws in the structure of the EU itself. It is a multidimensional crisis of the ...economic, legal and political cornerstones of European integration and marks the end of the technocratic mode of integration which has been dominant since the 1950s. The EU has a weak political and administrative centre, relies excessively on governance by law, is challenged by increasing heterogeneity and displays increasingly interlocked levels of government. During the crisis, it has become more and more asymmetrical and has intervened massively in domestic economic and legal systems. A team of economists, lawyers, philosophers and political scientists analyze these deeper dimensions of the European crisis from a broader theoretical perspective with a view towards contributing to a better understanding and shaping the trajectory of the EU.
The financial crisis has refocused attention on money and credit fluctuations, financial crises, and policy responses. We study the behavior of money, credit, and macroeconomic indicators over the ...long run based on a new historical dataset for 14 countries over the years 1870–2008. Total credit has increased strongly relative to output and money in the second half of the twentieth century. Monetary policy responses to financial crises have also been more aggressive, but the output costs of crises have remained large. Credit growth is a powerful predictor of financial crises, suggesting that policymakers ignore credit at their peril. JEL: E32, E44, E52, G01, N10, N20
We examine the evolution of real per capita GDP around 100 systemic banking crises. Part of the costs of these crises owes to the protracted nature of recovery. On average, it takes about 8 years to ...reach the pre-crisis level of income; the median is about 6.5 years. Five to six years after the onset of crisis, only Germany and the United States (out of 12 systemic cases) have reached their 2007-2008 peaks in real income. Forty-five percent of the episodes recorded double dips. Post-war business cycles are not the relevant comparator for the recent crises in advanced economies.
The implications of capital mobility for growth and stability are some of the most contentious and least understood contemporary issues in economics. In this book, Barry Eichengreen discusses ...historical, theoretical, empirical, and policy aspects of the effects, both positive and negative, of capital flows. He focuses on the connections between capital flows and crises as well as on those between capital flows and growth. Eichengreen argues that international financial liberalization, like other forms of economic liberalization, can positively affect the efficiency of resource allocation and the rate of economic growth. But analyses of both recent and historical experience also show an undeniable association between capital mobility and crises, especially when domestic institutions are weak and the harmonization of capital account liberalization and other policy reforms is inadequate. In his conclusion, Eichengreen makes suggestions for policy design to maximize the benefits of international financial liberalization while minimizing the risks of financial instability.
Reorganising Power in Indonesia is a new and distinctive analysis of the dramatic fall of Soeharto, the last of the great Cold War capitalist dictators, and of the struggles that reshape power and ...wealth in Indonesia. The dramatic events of the past two decades are understood essentially in terms of the rise of a complex politico-business oligarchy and the ongoing reorganisation of its power through successive crises, colonising and expropriating new political and market institutions. With the collapse of authoritarian rule, the authors propose that the way was left open for this oligarchy to reconstitute its power within society and the institutions of newly democratic Indonesia.
Crisis management has become a defining feature of contemporary governance. In times of crisis, communities and members of organizations expect their leaders to minimize the impact of the crisis at ...hand, while critics and bureaucratic competitors try to seize the moment to blame incumbent rulers and their policies. In this extreme environment, policy makers must somehow establish a sense of normality, and foster collective learning from the crisis experience. In this uniquely comprehensive analysis, the authors examine how leaders deal with the strategic challenges they face, the political risks and opportunities they encounter, the errors they make, the pitfalls they need to avoid, and the paths away from crisis they may pursue. This book is grounded in over a decade of collaborative, cross-national case study research, and offers an invaluable multidisciplinary perspective. This is an original and important contribution from experts in public policy and international security.
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