Exam 10: The Globalization of International Finance

The first phase of the 2008 global financial crisis is displacement, which refers to a change in the system that alters and creates profit opportunities for financial gain.

____________________ refers to the increasing transnationalization or centralization of financial markets through the worldwide integration of capital flows.

__________ is reserve assets used to settle international accounts.

The British economist who played a crucial role at the Bretton Woods conference was _________ .

In 1971, _______ announced that the United States would no longer exchange dollars for gold.

Describe the practice of dollar convertibility. How did this impact the international economy? How did it impact the domestic economy of the United States? Why was it ultimately unsustainable? What system took its place?

Although the unpredictability of the system of floating exchange rates was damaging to the economies of Global South countries, Global North countries were able to use their large currency reserves to profit from it.

The euro represents more than an economic policy. It is the end result of a decades-long process of economic integration.

Dollar convertibility refers to

A floating exchange rate means that

The Bretton Woods rested on three political bases, which were _______, _______, and ______.

Examples of how a system based on monetary policy works are

Most of the fiscal crises in the past thirty years have occurred in Global North rather than the Global South due to their more sophisticated financial systems.

The Marshall Plan provided Western European states billions of dollars in aid to buy the U.S. goods necessary to rebuild its war-torn economies.

____________________ is the study of the intersection of politics and economics that illuminates the reasons why changes occur and the distribution of states' wealth and power.

Globalization is a vague term that can be used in a multitude of ways but broadly defined is the increased integration of markets, trade, finance, and technology.

__________ is a system in which a government sets the value of its currency so that the exchange value is not free to fluctuate in the global money market.

Discuss why the United States left the Bretton Woods system and went with floating exchange rates to determine currency values.

Why does the globalization of finance have implications for international trade?

What are the three functions that money serves?