Finance Essay

8371 Words Aug 29th, 2012 34 Pages
WHARTON on... Global Finance

Global Finance:
Looking Back, and Ahead
The world is undergoing the worst financial crisis in decades. Although the global credit crunch was sparked by the bursting U.S. housing bubble, one of the most important causes was more basic: For too long, spending in the United States has outpaced incomes. This fundamental mismatch was supported temporarily by an extremely lax U.S. monetary policy that led to easy credit, and by foreign producers who supplied cheap goods to America in part by managing their currencies. The resulting, unsustainable imbalance led to financial collapse and a worldwide economic downturn,
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Feeling the Pain: How the Financial Crisis Is Affecting Brazil, Russia, India and China
As the financial crisis continues to roil credit and stock markets around the globe, it seems that no country or continent is being spared the consequences. Brazil, Russia, India, and China—the BRIC countries—are no exception. In an interview with Knowledge@Wharton, Shiv Khemka, vice chairman of SUN Group, based in London, New Delhi, and Moscow; Silas K.F. Chou, president and CEO of Novel Holdings, based in Hong Kong; and Odemiro Fonseca, founder of Viena Rio Restaurantes in Rio de Janeiro, discuss their countries’ responses to the crisis, its impact on specific sectors, the decoupling hypothesis, and the dangers of protectionism, among other topics.

Wharton on Global Finance I ©2009 University of Pennsylvania

Huge Reserves, Emerging Market ‘Challengers’, and Other Forces Are Changing Global Finance

Rapidly developing economies (RDEs) have increasingly become drivers of change—and sometimes disruption—in global financial markets. That has important implications for companies in the United States and Europe as new players emerge, including sovereign wealth funds, state-controlled entities, and acquisition-minded corporations.
As these groups bolster their foreign exchange reserves, they will increasingly look to buy assets beyond their borders,

including controlling stakes in foreign companies,

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