Regulating Global Finance MSOC 2

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Regulating Global Finance MSOC 2

• Presentation of Research Paper outline
• Matt Smith

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Overview of presentation and research paper
outline

• Research question
• Two fundamental problems caused by todays global
  financial agriculture
• Keynesian Policy, International Clearing Union
• Barriers to implementation, Neo Gramscian
  perspective
• Conclusionand questions for the group

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Research question

• The case for Keynesian International Clearing
  Union, and explaining its political barriers
  opportunities to implementation

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Two fundamental problems caused by todays global
financial agriculture

• Volatile capital markets and exchange rates
• Environment of uncertainly for business
• Global crowding out
• Reduced long term investment, global growth

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Two fundamental problems caused by todays global
financial agriculture

• Global balance of payment disequilibria
• No adjustment mechanism for surplus countries,
  unlike gold standard
• Surplus in one countries means deficit else
• where, more surplus more debtor
• Surpluss feed hedge finds and Euromarkets
• Adjustment burden placed upon deficit country

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International Clearing Union

• Post Keynesian proposal, International Clearing
  Unit
• Currency trade only in International Money
  Clearing Units (IMCU), between central banks
• Countries implement currency control, to minimise
  non productive flows (customise)
• Clearing Union monitors flows and stores of IMCU
  

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International Clearing Union

• Countries which accumulate IMCU by running
  balance of payment surplus, are
• encouraged to spend IMCU (if not spent for them),
  on either, additional exports, new FDI, aid to
  deficit countries
• Any LDC that regularly continue to run deficits
  will be given preference for spending of IMCU
  accumulators

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Neo-Gramscian theory

• Stefan Gills concept international financial
  panopticism
• Developed by Michel Foucault, based on Jeremy
  Benthams blue print of a prison
• Surveillance, disciplinary, conformity
• disciplinary neo-liberalism

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Regulation? Areas of thought

• Is the international financial system causing
  contradictions within the hegemonic classes
  alliances? Business uncertainly and crowding out,
  risk of crisis
• National bourgeoisie in the productive economy
• Currency crisis in Key nation states, threat to
  ideology?

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References

• Blecker, Robert (1999) Taming Global Finance
• Davidson, Paul (2002) Financial Markets, Money
  and the Real World
• Gill, Stephen (2000) The Constitution of Global
  Capitalism, Department of Political Science,
  http//www.ciaonet.org/isa/gis01/
• Gill, Stephen (1997) Finance, Production and
  Panopticism inequality, risk and resistance in
  the era of disciplinary neo-liberalism
• Helleiner, Erik (1994) States and the Emergence
  of Global Finance
• Blecker, Robert (1999) Taming Global Finance