International Monetary System必看课件资料.ppt

INTERNATIONAL FINANCIAL MANAGEMENT EUN / RESNICK Second Edition 2 Essential Readings P29-49 P53-57 International Monetary System International monetary system can be defined as the institutional framework in which international payments are made, movements of capital are accommodated , and exchange rates among currencies are determined. It is a complex whole of arrangements, rules, institutions, mechanisms, and policies regarding exchange rates, international payments, and the flow of capital. Main Contents Evolution of the International Monetary System Related Theories: Trilemma and Optimum Currency Areas. The Asian Currency Crisis Evolution of the International Monetary System Bimetallism: Before 1875 Classical Gold Standard: 1875-1914 Interwar Period: 1915-1944 Breton Woods System: 1945-1972 The Flexible Exchange Rate Regime: 1973-Present Bimetallism: Before 1875 A “double standard” in the sense that both gold and silver were used as money. Both gold and silver were used as international means of payment and the exchange rates among currencies were determined by either their gold or silver contents. Grasham’law phenomenon has only made the less valuable metal to circulate. Classical Gold Standard: 1875-1914 During this period in most major countries: Gold alone was assured of unrestricted coinage There was two-way convertibility between gold and national currencies at a stable ratio. Gold could be freely exported or imported. The exchange rate between two country’s currencies would be determined by their relative gold contents. Classic Gold Standard For Example: If 1 ounce gold=12Francs 1 ounce gold=6pounds Then 1pound=2Francs Classical Gold Standard: 1875-1914 Advantages of the Gold Standard: Highly stable exchange rates under the classical gold standard provided an environment that was conducive to international trade and investment. Misalignment of exchange rates and international imbalances of payment