Unit 1 Notes on Balance of Payments 1
Reading Material:Measuring a Country's Net International Investment Position 5
Unit 2 Voice:Add Balance to International Payments 7
Reading Material:Policy Options 10
Unit 3 Balance of Payments Adjustments 13
Reading Material:Analyzing the Balance of Payments of a Nation 16
Unit 4 Balance of Payments Adjustment Theory—The Elasticities Approach 18
Reading Material:Conflicted Virtue:The Deflationary Threat(1) 24
Unit 5 The Balance of Payments Adjustment Theory—The Absorption Approach 26
Reading Material:Conflicted Virtue:The Deflationary Threat(2) 30
Unit 6 Balance of Payments Adjustment Theory—The Monetary Approach 34
Reading Material:Conflicted Virtue:The Deflationary Threat(3) 38
Unit 7 Foreign Exchange Market 43
Reading Material:Forex Markets 47
Unit 8 Exchange Rate Systems and Policy(1) 50
Reading Material:China's Exchange Rate Regime(1) 55
Unit 9 Exchange Rate Systems and Policy(2) 59
Reading Material:China's Exchange Rate Regime(2) 63
Unit 10 Exchange Rate Systems and Policy(3) 67
Reading Material:The Relative Merits of Different Exchange Rate Regimes 71
Unit 11 The Purchasing Power Parity Puzzle 74
Reading Material:The Overshooting Model 79
Unit 12 Exchange Rates in the Long Run 82
Reading Material:A Salutary Lesson from the East Asian Financial Crisis 1997 86
Unit 13 Foreign Exchange Risks 91
Reading Material:Exchange Rate Risk in the European Union and the Euro 95
Unit 14 Supervision of Foreign Exchange Risk 98
Reading Material:Internal Guidelines on Foreign Exchange 105
Unit 15 Stock of Foreign Reserves 107
Reading Material:International Reserves and International Liquidity 111
Unit 16 Typical Approaches to Foreign Exchange Reserves Risk Management 115
Reading Material:Motivation of International Reserve 119
Unit 17 The Gold Standard 121
Reading Material:The Gold Standard and Fixed Exchange Rates 124
Unit 18 The Birth of Bretton Woods 127
Reading Material:The International Economy Prior to the Great Depression 130
Unit 19 The Money Markets 132
Reading Material:Types of Financial Instrurnent 137
Unit 20 The Capital Markets 140
Reading Material:Capital Market Securities:Bonds 145
Unit 21 The Changing Financial Landscape(1) 146
Reading Material:Policy Issues for Individuals and Private Enterprises in International Financial Markets 151
Unit 22 The Changing Financial Landscape(2) 153
Reading Material:Policy Issues for Public Policymakers in International Financial Markets 157
Unit 23 Liberalizing Capital Movements 160
Reading Material:Lessons from Latin American Capital Flows 167
Unit 24 The Asian Financial Crisis 169
Reading Material:What Have We Learned from The Asian Financial Crisis? 176
Unit 25 The Basel Committee 179
Reading Material:IOSCO and EU Directives 182
Unit 26 Basel Capital Accord(2) 185
Reading Material:One Voice for Credit Unions 189
Unit 27 The Fall and Rise of the International Economy 191
Reading Material:The Benefits of Multinational Companies 194
Unit 28 Recognizing Competitive Advantage 198
Reading Material:Why Invest in Another Country? 202
Unit 29 The Challenge of International Debt Relief 205
Reading Material:A Promising Millennium to Come 210
Unit 30 How to Develop the Financial Sector for Poverty Reduction 212
Reading Material:What More Can We Do to Reduce Poverty? 217
Unit 31 What Does the IMF Do? 219
Reading Material:The International Monetary Fund 223
Unit 32 The World Bank 227
Reading Material:World Bank Group 231
Unit 33 Exchange Rate,Competitiveness and Regions(1) 234
Reading Material:Exchange Rate Arrangements:A Discussion 239
Unit 34 Exchange Rate,Competitiveness and Regions(2) 242
Reading Material:Optimal Currency Areas 247
Unit 35 The Euro:Expectations and Performance 250
Reading Material:The Euro—An Emblem of the Successes and Challenges of European Integration(1) 256
Unit 36 The Euro Since Its Creation 259
Reading Material:The Euro—An Emblem of the Successes and Challenges of European Integration(2) 263
Vocabulary 267