Globalization and the International Monetary Community Essay

4545 Words19 Pages
Executive Summary

Our world is steadily shrinking. Technology is building bridges over the barriers of distance, language, and culture. It’s a process called globalization, and it is changing the way we live. Financial institutions haven’t been immune to the effects of this change. In fact, the international nature of financial institutions makes them particularly vulnerable to change. This paper addresses three issues caused by the globalization of the international monetary community.

First this paper examines the success of the Euro, and the implications for the formation of a global currency. Then this paper looks at the issue of devaluation, and by comparing successful and unsuccessful devaluations tries to determine
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Humanity’s life got much easier when money was invented. From ten foot tall coins to small strips of paper, currency is one of the most important inventions the human race has discovered. The invaluable ability to trade any item for a standard of value is what makes economy possible. Today, currency issues face the looming prospect of globalization. Like a tornado on the horizon, globalization is threatening to reform international currency into a twisted shape unlike anything we have ever seen. This paper addresses some of the major currency issues facing international financial organizations today. First the success and growing pains of the Euro will be discussed, with an emphasis on the implication of the Euro’s success on world currency. Next this paper will look at the devaluation of currency. The paper will also analyze what makes devaluation successful, and how devaluations are sometimes simply legalized theft from a country’s money holders. The final issue brought up by this paper is the rising trend of dollarization. Shaky economies are using the dollar to stabilize their currency, and more is being discovered about the implications of this practice all the time. The international currency community is facing many opportunities and challenges, a few of which are listed above. Hopefully these issues will paint a broad picture of a global financial community about to be picked up, spun around, and deposited in a
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