C9 International Financial System

International Financial System

Global network of financial institutions and markets.

Gold Standard System

Monetary system linking currency value to gold.

Bretton Woods System

Modified gold standard with fixed exchange rates.

International Monetary Fund (IMF)

Provides financial aid and policy guidance globally.

World Bank

Funds development projects in emerging economies.

Bank for International Settlements (BIS)

Supports central banks in financial regulation.

Foreign Exchange Market (Forex)

Largest market for trading currencies worldwide.

Exchange Rate Systems

Methods for determining currency values against others.

Global Financial Markets

Includes stock, bond, and commodity markets.

International Trade & Capital Flows

Movement of goods and investments across borders.

Monetary Systems

Frameworks governing currency and monetary policy.

Financial Regulations

Rules governing financial institutions and markets.

Currency Crises

Economic events causing rapid currency devaluation.

Debt Crises

Situations where countries cannot meet debt obligations.

Economic Inequality

Disparity in wealth between nations or groups.

Regulatory Gaps

Risks from unregulated financial activities.

Fixed Exchange Rates

Currency values tied to a specific asset.

Automatic Balance of Payments Adjustment

Gold movement corrects trade imbalances automatically.

Limited Monetary Policy

Restrictions on money supply due to gold ties.

Classical Gold Standard

Period of stability from 1870s to 1914.

Modern Fiat Currency System

Current monetary system without gold backing.

Bitcoin as Digital Gold

Finite digital currency compared to traditional gold.

Gold Standard

Currency backed by a fixed amount of gold.

Modern Fiat System

Currency not backed by physical commodities.

Money Supply Control

Gold reserves limit supply; central banks control it.

Exchange Rate

Fixed rates under gold standard; floating rates now.

Inflation Control

Natural control via gold supply; managed by policy.

Economic Stability

Stable but rigid under gold; flexible but crisis-prone.

Trade Adjustment

Automatic adjustments via gold flows in gold standard.

Government Intervention

Minimal under gold; high in modern systems.

U.S. Dollar Role

Primary reserve currency for global transactions.

IMF Creation

Monitors exchange rates and provides financial aid.

World Bank Creation

Funds reconstruction and development projects.

Trade Controls

Countries manage capital flows to prevent crises.

Positive Trade Effects

Stable rates reduced currency uncertainty for trade.

Economic Growth

Increased trade led to global expansion post-WWII.

Investment Encouragement

Promoted foreign investment in developing regions.

Competitive Devaluations Prevention

Avoided currency wars worsening the Great Depression.

Gold Standard Advantages

Long-term stability, prevents excessive inflation.

Gold Standard Disadvantages

Limits growth, can cause deflation and slowdowns.

Modern Monetary Advantages

Flexible policies for inflation and recession management.

Modern Monetary Disadvantages

Prone to inflation and financial instability risks.

U.S. Dollar Shortage

Insufficient gold reserves backing U.S. dollar.

Inflation

Increase in prices due to excessive dollar printing.

End of Gold Convertibility

1971 decision to stop dollar's gold backing.

Fiat Currency

Currency without intrinsic value, not backed by gold.

Floating Exchange Rates

Currency values determined by market forces.

IMF Establishment Year

Founded in 1944 as part of Bretton Woods.

IMF Member Countries

190 countries participate in IMF's economic monitoring.

IMF Surveillance

Monitoring economic health and providing policy advice.

Financial Assistance

Loans to countries in economic crises.

Crisis Prevention

IMF helps avert economic recessions globally.

Technical Assistance

Support for developing policies in member countries.

Trade Liberalization

Encouragement of open markets and reduced barriers.

Harsh Loan Conditions

Strict reforms required for IMF loans.

Debt Burden

Long-term economic dependency from IMF loans.

IMF Influence

Voting power favors wealthy nations like the U.S.

Positive Impact on Trade

Stabilizes exchange rates and supports global trade.

Emergency Funds

Financial support to stabilize economies quickly.

Economic Policy Advice

Guidance on taxation and banking stability.

IMF's Role in Recovery

Supports recovery plans post-financial crises.

Debt Relief

Assistance to poor nations for economic growth.

IMF

International Monetary Fund, stabilizes global economies.

Currency Crisis

Rapid devaluation of a country's currency.

Austerity Measures

Government policies to reduce spending and deficits.

Fiscal Deficit

When government expenditures exceed revenues.

Bailout Funds

Financial assistance to prevent economic collapse.

Balance of Payments Crisis

Insufficient foreign currency for imports.

Emergency Funding Program

IMF's financial aid during global crises.

Economic Recovery

Restoration of economic stability post-crisis.

Trade Freeze

Halting of international trade activities.

Investor Confidence

Trust investors have in a country's economy.

Public Protests

Demonstrations against government policies, often austerity.

Unemployment Rate

Percentage of unemployed individuals in the labor force.

Foreign Investment

Capital invested by foreign entities in a country.

Supply Chains

Network between a company and its suppliers.

Economic Meltdown

Severe economic downturn leading to collapse.

Trade Relations

Economic interactions between countries regarding trade.

Financial Stability

Condition where financial institutions operate effectively.

COVID-19 Pandemic Impact

Global economic downturn due to health crisis.

Essential Goods

Basic products necessary for survival and well-being.

Market Confidence

General trust in the financial markets.

Loan Amount

Total funds provided by IMF to a country.

Economic Collapse

Complete failure of a country's economy.