Recurrent instability has characterized the global financial system since the 1980s. This instability and the resultant disruptions - to financial and foreign exchange markets, causing bankruptcies and sovereign debt defaults - are linked, in this book, to shortcomings of the global financial system which tend to generate cycles of boom and bust in credit flows. These cycles are set in motion by the monetary impulses of major industrial countries and are amplified and propagated through the operation of global financial markets. Fabrizio Saccomanni argues that to counter such systemic instability requires that national authorities give adequate weight to financial stability objectives when formulating their monetary and regulatory policies. He maintains that appropriate multilateral strategies to deal with unsustainable trends in credit aggregates and asset prices should be devised in the institutions of international monetary and financial cooperation
Foreword by Tommaso Padoa-Schioppa
Pt. I The Tigers, the Tamers, the Circus
1 An uneasy relationship
2 Global financial players
3 Monetary and financial authorities
4 The global market for foreign exchange
Pt. II Global Finance Between Crisis and Reform
5 The crises of global finance
6 In search of international monetary and financial stability
Pt. III Challenging the Tigers
7 A cage for the dollar: the Plaza and Louvre Accords (1985-87)
8 The seven-year war of the French franc (1991-98)
9 The resistible rise of the yen (1995)
10 Double play in Hong Kong (1998)
11 A safety net for the euro (2000)
12 The great wall of the Chinese renminbi (1994-2005)
13 How did they do it?
Pt. IV Epilogue
14 The golden mean
Bibliography