Unit 3: Financial Globalization and Systemic Risk (5 minutes) Unit 4: Drivers of Capital Flows and The Role of the Global Financial Cycle (8 minutes) Unit 5: Conclusions (2 minutes) Learning Objectives. Financial globalization started in late 1980s which was assumed to bring in more growth to a country especially the developing countries. financial institutions have collapsed, and more importantly wealthiest governments, most of them are leading liberals, have to prepare packages to rescue their financial systems. The primary goal, then, is to ensure that countries and independent financial actors work in harmony with one another for the betterment of everyone. daccess-ods.un.org. But that scarcely brings us nearer to what globalisation means. Trade The exchange of goods and services between nations. It is also about how integrated countries are in the global economy. Globalization, or globalisation (Commonwealth English; see spelling differences), is the process of interaction and integration among people, companies, and governments worldwide.Globalization has accelerated since the 18th century due to advances in transportation and communication technology. daccess-ods.un.org. Global capital flows fluctuated between 2 and 6 percent of world GDP during the period 1980-95, but since then they have risen to 14.8 percent of GDP, and in 2006 they totaled $7.2 trillion, more than tripling since 1995. Financial Crisis
Stage 1: Severe fiscal imbalances
Stage 2: Run up to the currency crisis
Stage 3: Currency crisis
Final stage: currency crisis triggers a full-fledged financial crisis
9. The lecture will help learners understand recent developments in financial globalization, including why theoretical benefits do not always match what is observed empirically. The risks attached to international financial integration have received much attention, although the main focus has been on the vulnerabilities of emerging and developing economies. However, financial globalization does not always work to encourage economic development because it often leads to devastating financial crises. The world's financial markets have experienced a dramatic increase in globalization in recent years. ECONOMIC AND FINANCIAL GLOBALIZATION The first stage (“Concepts and definitions”) involves getting the concepts clear – finding out what the concept means and, if necessary, listing its main accepted meanings. Globalization Example #4. Globalization is a complicated and ever-changing process that has both good and bad aspects. More importantly, in open financial markets the entry of foreign financial institutions into domestic financial markets can bring sizeable benefits, as increased competition can help to enhance efficiency in the financial sector. Globalization is the process by which ideas, goods and services spread throughout the world. Financial globalization can be defined as the movement of investments and financial services across international borders. Plan •Gross capital flows •Global factors and capital flows •Global imbalances •The gains from financial globalization 2 Kuala Lumpur 2016 - Luis Servén. The issue is thus not whether financial globalization is inherently good or bad, but whether it can be done right. Sep 5, 2017 Hans-Helmut Kotz, Susan Lund. In the future digital platforms, blockchain, and machine learning may transform financial markets and create new channels for cross-border capital flows. Financial globalization and its effects 1 Kuala Lumpur 2016 - Luis Servén. 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