Contemporary international finance and East Asian economic integration

Type :

Presentation

Pages :

12 pages

Format :

.doc

Published date :

01/16/2009

Category :

Economics & finance

Sub category :

Economics

Oboulo.com selection criteria

$ 19.95 Add to cart

Summary :

The features of general situation of a country before falling into the current account crisis.
1. Overall macroeconomic performances.
2. Balance of payments conditions.
3. Savings and investments gaps.
4. Development stage of balance of payments.
5. Sustainability of the situation.
6. Possibility of foreign exchange crisis.
General situation of the United States before August 2007.
1. Overall macroeconomic performances.
2. Balance of payments conditions.
3. Savings and investments gaps.
4. Development stage of balance of payments.
5. Sustainability of the situation.
6. Possibility of foreign exchange crisis.
The features of general situations of a country before falling in a capital account crisis.
1. Overall macroeconomic performances.
2. Balance of payments conditions.
3. Savings and investments gaps.
4. Development stage of balance of payments.
5. Sustainability of the situation.
6. Possibility of Foreign exchange crisis.
Annexures.
Bibliography.

Abstract

The "Current Account crisis" is a particular type of external debt crisis that affects mostly low-income developing countries. It is characterized by a huge deficit in the current account balance which provokes a Balance of payments deficit and a currency crisis. A current account crisis occurs generally in low-income developing countries. It is most of all the result of bad macroeconomic policies. These countries have a large current account deficit, principally due to a trade deficit - because they are mostly net importers - and a fiscal deficit. Moreover, they generally have a high rate of inflation, in part because they try to finance their growing deficit by monetization. That leads to a loss of international price competitiveness. Indeed, they are under fixed exchange rate and the inflation makes the rate overvalued. Furthermore, the government dominates the economy. It is the major borrower; the private sector is underdeveloped and inactive. The consequence is a limited capital flow and the external debt is mostly a public debt.