In this second miniseries of Season 2, "Global Finance", we're wrestling with the strangeness of living in a world that aspires to a level of global integration that our current systems can't support - and maybe don't want to. We looked at the fragility of money transfers for average citizens, the fraught history of the IMF, and the easily abused systems of microfinancing and cryptocurrency (along with the reasons we're itching for something new). In this series closer, there are no easy solutions - some promises in tech, some challenges through arbitration - but maybe it's enough just to sit with the enormity of the problem. Once we stop buying into quick fixes, we'll finally be ready to look at root causes.REFERENCESAdrian, Tobias. "Tobias Adrian on the Future of Finance", Fintech Forward, IMF Podcasts. 2022. https://www.imf.org/en/News/Podcasts/All-Podcasts/2022/06/08/mcm-fintech-forward-tobias-adrianDoran, Michael and James Tanner. “Critical challenges facing the green bond market”. Baker McKenzie, in partnership with the International Financial Law Review. 2019. https://www.bakermckenzie.com/-/media/files/insight/publications/2019/09/iflr--green-bonds-%28002%29.pdfJefriando, Maikel and Daniel Leussink, "In Indonesia, long-term foreign bond investors keep the faith--for now", Reuters. 2018. https://www.reuters.com/article/indonesia-economy-risks-idINKCN1LU10YOECD Codes of Liberalisation: User’s Guide", OECD. 2019. www.oecd.org/investment/codes.htmWahidin, Deni et al. “The impact of bond market development on economic growth before and after the global financial crisis: Evidence from developed and developing countries”, International Review of Financial Analysis (Vol 77). October 2021. https://www.sciencedirect.com/science/article/abs/pii/S1057521921001952Referenced subsection:A full side essay exists on Better Worlds Theory, "What We Take for Granted about Global Finance", which includes a touch more explanation about the role of long-term bonds in foreign investments, along with recommendations for staying apprised of global discourse about next steps in all these difficult sub-fields. https://open.substack.com/pub/mlclark/p/what-we-take-for-granted-about-global
In this second miniseries of Season 2, "Global Finance", we're wrestling with the strangeness of living in a world that aspires to a level of global integration our current systems can't support - and maybe don't want to. The rise of cryptocurrency has many stories attached to it: some about wanting to change the world, some about exploiting the world in new ways. In this episode, we reflect on the deeper story: the fact that we're hungry for alternative financial relationships in the first place. How else can we answer that underlying need for global reform?REFERENCESBains, Parma. "Regulating the Crypto Ecosystem: The Case of Stablecoins and Arrangements", FinTech Notes, IMF. 2022. https://www.imf.org/en/Publications/fintech-notes/Issues/2022/09/26/Regulating-the-Crypto-Ecosystem-The-Case-of-Stablecoins-and-Arrangements-523724Clark, M L. "The crypto crisis fallout in El Salvador", OnlySky. 2022. https://onlysky.media/mclark/the-crypto-crisis-fallout-in-el-salvador/---. "FTX to file for bankruptcy, CEO of crypto giant steps down", OnlySky. 2022. https://onlysky.media/mclark/ftx-to-file-for-bankruptcy-ceo-of-crypto-giant-steps-down/Fuje, Habtamu et al. "Africa’s Growing Crypto Market Needs Better Regulations", IMF Blog, Fintech. 2022. https://www.imf.org/en/Blogs/Articles/2022/11/22/africas-growing-crypto-market-needs-better-regulationsKharpal, Arjun. "IMF head says stablecoins not backed by assets are a ‘pyramid,’ hinting at UST debacle that crashed markets", CNBC. 2022. https://www.cnbc.com/2022/05/23/imf-head-says-stablecoins-not-backed-by-assets-are-a-pyramid-hinting-at-ust.htmlMandeng, Ousmène Jacques. "Stable coins’ rise has echoes of Bretton Woods", Financial Times. 2021. https://www.ft.com/content/4bb77dd2-ad49-4f26-990a-cf6513b54057Martin, Eric. "IMF urges El Salvador to Strip Bitcoins Legal Tender Status", Al Jazeera. 2022. https://www.aljazeera.com/economy/2022/1/25/imf-urges-el-salvador-to-strip-bitcoins-legal-tender-statusNugent, Ciara. "Why El Salvador’s Bukele Is Doubling Down on Bitcoin Despite the Crypto Crash", Times Magazine. 2022. https://time.com/6236899/el-salvador-bukele-bitcoin-crash/Wheatley, Jonathan and Adrienne Klasa. "Cryptocurrencies: developing countries provide fertile ground", Financial Times. 2021. https://www.ft.com/content/1ea829ed-5dde-4f6e-be11-99392bdc0788
In this second miniseries of Season 2, "Global Finance", we're wrestling with the strangeness of living in a world that aspires to a level of global integration our current systems can't support - and maybe don't want to. In this episode, I reflect on a time when I was beguiled by the feel-good story of microfinancing. Nothing is ever that simple, sadly, when it comes to the easily gamified world of global finance.NB: There is an error in the script, corrected in the show notes and transcript. Andhra Pradesh is a key location in Poverty Capital, which was written by Ananya Roy. REFERENCESBateman, Milford. "The Rise and Fall of Muhammad Yunus and the Microcredit Model", International Development Series Working Paper. 2014. https://www.researchgate.net/publication/272241825_The_Rise_and_Fall_of_Muhammad_Yunus_and_the_Microcredit_ModelBernards, Nick. A Critical History of Poverty Finance: Colonial Roots and Neoliberal Failures. Pluto Press, 2022. https://www.plutobooks.com/9780745344829/a-critical-history-of-poverty-finance/Donovan, Kevin P. "Microfinance's Imagined Utopia", Boston Review. 2023. https://www.bostonreview.net/articles/microfinances-imagined-utopia/Donovan, Kevin P. and Emma Park. "Perpetual Debt in the Silicon Savannah", Boston Review. 2019. https://www.bostonreview.net/articles/perpetual-debt-silicon-savannah/Meyerowitz, Joanne. A War on Global Poverty: The Lost Promise of Redistribution and the Rise of Microcredit, 2021Nelson, Eshe. Nobel winner Muhammad Yunus wants two financial systems—one for the rich and one for the poor", Quartz. 2018. https://qz.com/1430076/nobel-winner-muhammad-yunus-wants-two-financial-systems-one-for-the-rich-and-one-for-the-poorRoy, Ananya. Poverty Capital: Microfinance and the Making of Development. Routledge Press, 2010. https://www.routledge.com/Poverty-Capital-Microfinance-and-the-Making-of-Development/Roy/p/book/9780415876735Yunus, Muhammad. A World of Three Zeros: The New Economics of Zero Poverty, Zero Unemployment, and Zero Net Carbon Emissions. PublicAffairs. 2017. https://www.hachettebookgroup.com/titles/muhammad-yunus/a-world-of-three-zeros/9781610397582/
In this second miniseries of Season 2, "Global Finance", we're wrestling with the strangeness of living in a world that aspires to a level of global integration our current systems can't support - and maybe don't want to. The IMF and World Bank are complex forces in the world today. Located in and funded by countries that caused a great deal of financial inequality in the first place, is their austerity-driven approach to loan programs truly what many struggling nations need to break from cycles of poverty?REFERENCESEasterly, William. "The Effect of International Monetary Fund and World Bank Programs on Poverty", World Bank/IMF External Documents, 2000. https://www.imf.org/external/pubs/ft/staffp/2000/00-00/e.pdf---. The White Man's Burden: Why the West's Efforts to Aid the Rest Have Done So Much Ill and So Little Good. Penguin Press, 2006. Elliott, Larry. "The World Bank and the IMF won't admit their policies are the problem", The Guardian. 2016. https://www.theguardian.com/business/2016/oct/09/the-world-bank-and-the-imf-wont-admit-their-policies-are-the-problemFukuyama, Francis. The End of History. 1992."IMF Report: 2018 Review of Program Design and Conditionality", International Monetary Find. 2019. https://www.imf.org/en/Publications/Policy-Papers/Issues/2019/05/20/2018-Review-of-Program-Design-and-Conditionality-46910Masters, Jonathan et al. "The IMF: The World’s Controversial Financial Firefighter", Council on Foreign Relations. 2021. https://www.cfr.org/backgrounder/imf-worlds-controversial-financial-firefighterMartin, Eric. "IMF urges El Salvador to strip Bitcoin’s legal tender status", Al Jazeera. 2022. https://www.aljazeera.com/economy/2022/1/25/imf-urges-el-salvador-to-strip-bitcoins-legal-tender-statusSmith, Robert and Zoe Chace. "The Dollar At The Center Of The World", NPR Planet Money. 2014. https://www.npr.org/transcripts/331743569Stubbs, Thomas et al. "How to evaluate the effects of IMF conditionality", The Review of International Organizations. 2018. https://link.springer.com/article/10.1007/s11558-018-9332-5
In this second miniseries of Season 2, "Global Finance", we're wrestling with the strangeness of living in a world that aspires to a level of global integration our current systems can't support - and maybe don't want to. The internet age gives the impression of easy connectivity, but the reality is quite different for those trying to make and send money to a great many struggling nation-states. In this episode, we reflect on the fragility of money transfer systems for everyday clients.REFERENCESAdrian, Tobias. "Cross-Border Payments for the 21st Century", IMF Podcasts. 2023. https://www.imf.org/en/News/Podcasts/All-Podcasts/2023/01/19/tobias-adrian-cross-border-paymentsGuiliano, Paola and Marta Ruiz-Arranz. "Remittances, Financial Development, and Growth", IMF Working Report. 2005. https://www.imf.org/external/pubs/ft/wp/2005/wp05234.pdfIt's A Wonderful Life. 1946.Migration Data Portal. "Remittances". 2023. https://www.migrationdataportal.org/themes/remittancesRice, Tara et al. "On the global retreat of correspondent banks", BIS Quarterly Review, 2020. https://www.bis.org/publ/qtrpdf/r_qt2003g.htmTeixeira da Silva Filho, Tito Nicias. "Curb Your Enthusiasm: The Fintech Hype Meets Reality in the Remittances Market", IMF Working Paper, 2022. https://www.imf.org/-/media/Files/Publications/WP/2022/English/wpiea2022233-print-pdf.ashxTreanor, Jill and Dominic Rushe. "HSBC pays record $1.9bn fine to settle US money-laundering accusations", The Guardian. 2012. https://www.theguardian.com/business/2012/dec/11/hsbc-bank-us-money-launderingWoodman, Spencer. "HSBC moved vast sums of dirty money after paying record laundering fine", International Consortium of Investigative Journalists, 2020. https://www.icij.org/investigations/fincen-files/hsbc-moved-vast-sums-of-dirty-money-after-paying-record-laundering-fine/