Description
International Money and Finance, Ninth Edition presents an institutional and historical overview of international finance and international money, illustrating how key economic concepts can illuminate real world problems.
With three substantially revised chapters, and all chapters updated, it functions as a finance book that includes an international macroeconomics perspective in its final section. It emphasizes the newest trends in research, neatly defining the intersection of macro and finance.
Successfully used worldwide in both finance and economics departments at both undergraduate and graduate levels, the book features current data, revised test banks, and sharp insights about the practical implications of decision-making.
- Includes current events, such as the LIBOR and Greek crises
- increases emphasis on countries other than the US
- Minimizes prerequisites to encourage use by students from varied backgrounds
Chapter
I. The International Monetary Environment
1 The Foreign Exchange Market
Foreign Exchange Trading Volume
Geographic Foreign Exchange Rate Activity
Short-Term Foreign Exchange Rate Movements
Long-Term Foreign Exchange Movements
Appendix A. Trade-Weighted Exchange Rate Indexes
Appendix B. The Top Foreign Exchange Dealers
2 International Monetary Arrangements
The Gold Standard: 1880–1914
The Interwar Period: 1918–1939
The Bretton Woods Agreement: 1944–1973
Central Bank Intervention During Bretton Woods
The Breakdown of the Bretton Woods System
The Transition Years: 1971–1973
International Reserve Currencies
Post Bretton Woods: 1973 to the Present
The Choice of an Exchange Rate System
Currency Boards and “Dollarization”
The European Monetary System and the Euro
Appendix A. Current Exchange Rate Arrangements
3 The Balance of Payments
Financing the Current Account
Additional Summary Measures
Transactions Classifications
Current Account Disequilibria
Balance of Payments Equilibrium and Adjustment
How Serious Is the US Foreign Debt?
II. International Parity Conditions
4 Forward-Looking Market Instruments
Other Forward-Looking Instruments
5 Eurocurrency Markets and the LIBOR
Reasons for Offshore Banking
Interest Rate Spreads and Risk
International Banking Facilities
Offshore Banking Practices
6 Exchange Rates, Interest Rates, and Interest Parity
Effective Return on a Foreign Investment
Deviations From Covered Interest Rate Parity
Interest Rates and Inflation
Exchange Rates, Interest Rates, and Inflation
Expected Exchange Rates and the Term Structure of Interest Rates
Appendix A. What Are Logarithms, and Why Are They Used in Financial Research?
7 Prices, Exchange Rates, and Purchasing Power Parity
Absolute Purchasing Power Parity
Relative Purchasing Power Parity
Overvalued and Undervalued Currencies
Appendix A. The Effect on PPP by Relative Price Changes
III. Risk and International Capital Flows
8 Foreign Exchange Risk and Forecasting
Types of Foreign Exchange Risk
The Foreign Exchange Risk Premium
Foreign Exchange Forecasting
Fundamental Versus Technical Trading Models
9 Financial Management of the Multinational Firm
An Example of Trade Financing
Appendix A. Present Value
10 International Investment
Portfolio Diversification
Reasons for Incomplete Portfolio Diversification
International Investment Opportunities
The Globalization of Equity Markets
Foreign Direct Investment
Appendix A. American Depositary Receipts
11 International Lending and Crises
Causes of Financial Crises
International Lending and the Great Recession
International Lending and the Greek Debt Crisis
IV. Modeling the Exchange Rate and Balanceof Payments
12 Determinants of the Balance of Trade
Elasticities Approach to the Balance of Trade
Elasticities and the J-Curve
The Marshall–Lerner Condition
The Evidence From Devaluations
Absorption Approach to the Balance of Trade
The Internal and External Macroeconomic Equilibrium
Monetary Policy Under Fixed Exchange Rates
Fiscal Policy Under Fixed Exchange Rates
Monetary Policy Under Floating Exchange Rates
Fiscal Policy Under Floating Exchange Rates
Using the IS-LM-BP Approach: The Asian Financial Crisis
International Policy Coordination
Appendix A. The Open Economy Multiplier
The Monetary Approach to the Balance of Payments
The Monetary Approach to the Exchange Rate
The Monetary Approach for a Managed Floating Exchange Rate
15 Extensions and Challenges to the Monetary Approach
The Trade Balance Approach
The Overshooting Approach
The Currency Substitution Approach
Recent Innovations to Open-Economy Macroeconomics
International Money and Finance
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