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"Is Financial Globalization Truly Global?: New Institutions for an Inclusive Capital Market"
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Abstract
In 2002 more than 1trillionworthofnewbondswassoldacrossinternationalboundaries.Thetotalstockofcross−borderbondholdingswasmorethan9 trillion. Such lending, together with sales of equities, is regarded as one of the chief benefits of globalization. But financial investment does not always flow where it is needed most.While it appears that the world cannot be satiated with U.S. securities, issues of emerging economies account for less than 6 percent of total international holdings of debt securities (DÕArista 2003). And, as Argentina discovered recently, international lenders can be fickle, selling enough foreign currency and securities to cause a currency crisis.