Global Finance at Risk

The Case for International Regulation

A “timely” (Library Journal) argument for an international body that will foster a more stable, viable global financial system

“[An] excellent book [which] makes powerful reading . . . for those of us who cannot quite believe that history has come to an end, or that the US economy has entered a new era of assured growth, or that globalization is wholly virtuous; and who are otherwise nervous or unhappy about how the world economy developed in the last quarter of the last century.” —Times Literary Supplement

In Global Finance at Risk, two economists whom John Kenneth Galbraith has hailed as “accomplished scholars of the first rank” propose a bold solution to the financial crises that threaten us all: a World Financial Authority with powers to establish worldwide best-practice financial regulation and risk management. Expansion of finance in industrialized economies, including that of the nineteenth-century United States, was accompanied by the same kind of turbulence now afflicting Asia, Russia, and Latin America. Then, the solution was to establish national banking and securities regulators, create deposit insurance, and empower lenders of last resort. But in our increasingly globalized times, an account opened at a local bank can be based on bad debt from anywhere in the world, including places outside the jurisdiction of those national agencies. And when banks fail, it is not only their account holders who suffer, but all of us. This is why, argue John Eatwell and Lance Taylor in this timely and urgent book, effective regulation of international finance is crucial to the economic health of all nations. Global Finance at Risk casts a welcome light on the deepening intricacies of world financial systems.

Praise

“No economic development of our time is so threatening as to affect and so little understood as the great and unpredicted movements of financial capital between countries. Here two accomplished scholars of the first rank deal with the problem so created, in clear English, with informed thought and willingness to embrace the evident solution. I strongly recommend it.”
—John Kenneth Galbraith