Despite this fact, it would be simplistic to state that G8 should not have the ability to make financial decisions independent of the UN and other international influence. As the countries that have provided the majority of financing for the world's poorest countries, it may be that the continued financial health of those countries depends upon them getting a financial benefit from such financial assistance. Therefore, the current world economy may actually depend on the ability of G8 to operate independently from the broader international community.
Q3: How does the Fisher effect impact the ability to forecast currency exchange rates? If the real interest rate is constant across borders, one would expect a constant currency exchange rate, but this does not occur. On the contrary, currency exchange rates are subject to a tremendous amount of fluctuation. Why does this occur?
A3: The Fisher hypothesis posits that in integrated capital markets, the real interest rate is not dependent upon monetary measures like the nominal interest rate, but instead reflects a relationship between the nominal interest rate and the expected rate of inflation. The Fisher hypothesis is largely based on the principle of monetary neutrality. Therefore, changes in a country's currency's exchange rate can be expected to catch up quickly with internal changes in that country's economy. However, the Fisher effect cannot always be used in calculating exchange rates, especially when one of the countries has a prohibitive economy. For example, many developing countries place great internal restrictions on nominal interest rates and rates of inflation, which make capital market integration more difficult. These restrictions can mask a country's actual financial condition, making it impossible to determine the appropriate currency exchange rate.
Q4: What could one expect if the international community made the decision to convert to one form of international currency, rather than using different forms of currency in each country?...
This strategy, along with an "old-fashioned slap shot" - which was "drilled home...by Bill Baker of the University of Minnesota, in front of a crowd of 4,000 that half-filled the new field house" in Lake Placid. Only half full meant that perhaps most American Winter Olympics' fans didn't think the U.S. had a chance, and didn't buy the tickets because of that. Eskenazi went on to explain that on the
Politics Third World America: How Our Politicians are Abandoning the Middle Class and Betraying the American Dream The Third World America book, written by Arianna Huffington, is designed to show the current state of the United States, and how politicians are not actually taking care of the American people they are elected to protect and serve. The main thesis is that the original political system that was created when the country was
USA Hegemony There are no fundamental differences between now and what international politics used to be in the first half of the 20th Century. It is true that the post-WWII period has been more peaceful, but it is not because of a fundamental transformation in the way international politics works. To state that there are no fundamental differences between international politics in 1900-45 and afterwards would be to carry the argument to
Bonta states of Rome that, by the first century B.C., sexual mores had been abandoned, and the former sanctity of marriage forgotten. Crime, once almost unknown in Rome, became rampant. In such an environment, Rome became an easy target for political conspiracies like that of Catiline, which exploited the criminal elements in Rome to carry out bribery, blackmail, and assassination. (Bonta 2005. p36) One would not be too hard put
The U.S. Drug Enforcement Agency has stated that up to 50% of the heroin coming into the United States passes through Nigeria. Concern over progress towards democracy -- that Nigeria is backsliding towards military dictatorship, and human rights violations. In specific terms, the strategic importance of Nigeria from U.S. perspectives lies in the country's economic, political and military power (which) has provided some anchor of stability for the region. If the
To an extent, the idea of Cold War nation building has been in evidence in attempts to instill democracy in fronts such as Afghanistan and Iraq. But as a new president seeks to undo the damage of previous security policy conditions, it is apparent that this is an archaic approach to understanding the way individuals tend to behave under foreign occupation. The resistance that has made Iraq one of
Our semester plans gives you unlimited, unrestricted access to our entire library of resources —writing tools, guides, example essays, tutorials, class notes, and more.
Get Started Now