Currency

About: Currency is a research topic. Over the lifetime, 26697 publications have been published within this topic receiving 485370 citations. The topic is also known as: monetary unit & unit of money.

The End of Finance

Abstract: Introduction Part One: Phenomenology I. Do we know what the financial markets are? II. At the root of the possibility of crisis: liquidity and risk III. What is credit? IV. What is money? V. Finance starting from the end VI. Capitalism and debt: a matter of life and death Part Two: History I. From credit risk to liquidity risk (2008) II. The globalization of capital (1973) III. Fiat dollar'. And the world saw that it was good (1971) IV. The Eurodollar chimera (1958) V. The European Payments Union (1950) VI. Bretton Woods: the plan that might have made it (1944) VII. Bretton Woods: the system that found implementation (1944) VIII. The crisis paradigm (1929) IX. Orchestra Rehearsal X. Money before and after the gold standard (1717) XI. The Bank of England and power currency (1694) XII. The International Currency of the Trade Fairs (1579) Part Three: Politics I. Double or quits? II. The way out of liquidity: the Gordian knot and utopia III. Prevention or cure? The structural paradox of the anti-crisis policies IV. The other finance V. The (rare) "green shoots" of a possible reform VI. If not now, when?

The Global Financial Crisis and currency crises in Latin America

Abstract: The Global Financial Crisis (GFC) has aected many regions including Latin America. This paper focuses on currency crises in Argentina, Brazil and Mexico. We estimate an Early Warning System, consisting of a dynamic factor model and an ordered logit model, with monthly data for 1990-2007. Ex ante forecasts for 2008-2009 do not produce currency crises in the fall of 2008, in sharp contrast with reality. Our model only predicts an increased probability of a currency crisis for Argentina in 2009.

'Currency Manipulation' and World Trade

Abstract: Central bank intervention in foreign exchange markets may, under some conditions, stimulate exports and retard imports. In the past few years, this issue has moved to center stage because of the foreign exchange policies of China. China has regularly intervened to prevent the RMB from appreciating relative to other currencies, and over the same period has developed large global and bilateral trade surpluses. Numerous public officials and commentators argue that China has engaged in impermissible "currency manipulation," and various proposals for stiff action against China are now pending on Capitol Hill. This paper clarifies the theoretical relationship between exchange rate policy and international trade, and addresses the question of what content can be given to the concept of "currency manipulation" as a measure that may impair the commitments made in trade agreements. The analysis goes to the proper relationship between IMF obligations and WTO obligations and to the question whether trade measures can be an appropriate response to exchange rate policies. Our conclusions are at odds with much of what is currently being said in Washington. For example, it is often asserted that China's currency policies have real effects that are equivalent to an export subsidy. In fact, however, if prices are flexible the effect of exchange rate intervention parallels that of a uniform import tariff and export subsidy, which will have no real effect on trade, an implication of Lerner's symmetry theorem. With sticky prices, the real effects of exchange rate intervention and the translation of that intervention into trade-policy equivalents depend critically on how traded goods and services are priced. We show how the effects differ, according to whether exporters invoice in the local currency of the producer, in the currency of the buyer, or in a "vehicle" currency such as dollars. The real effects of China's policies are thus potentially quite complex, are not readily translated into trade-policy equivalents, and are dependent on the time frame over which they are evaluated (because prices are less "sticky" over a longer time frame). Accordingly, we are skeptical about many of the policy responses now under consideration in Washington both on economic and legal grounds.

Internationalization of the RMB and Historical Precedents

Abstract: The possibility that the renminbi may soon join the ranks of international currencies has generated much excitement. This paper looks to history for help in evaluating the factors deter mining its prospects. The three best precedents in the twentieth century were the rise of the dol lar from 1913 to 1945, the rise of the Deutsche mark from 1973 to 1990, and the rise of the yen from 1984 to 1991. The fundamental determinants of international currency status are econom ic size, confidence in the currency, and depth of financial markets. The new view is that, once these three factors are in place, internationalization of the currency can proceed quite rapidly. Thus some observers have recently forecast that the RMB may even challenge the dollar within a decade. But they underestimate the importance of the third criterion, the depth of financial markets. In principle, the Chinese government could decide to create that depth, which would require accepting an open capital account, diminished control over the domestic allocation of credit, and a flexible exchange rate. But although the Chinese government has been actively promoting offshore use of the currency since 2010, it has not done very much to meet these requirements. Indeed, to promote internationalization as national policy would depart from the historical precedents. In all three twentieth-century cases of internationalization, popular inter est in the supposed prestige of having the country's currency appear in the international listings