Globalization of the World Economy

1. The condition that the country must meets to attract and hold enough reserves

1.1. Fixed exchange rate

1.2. Convertibility

1.3. sacrifice monetary sovereignty

2. The Heyday of the Gold Standard

2.1. Countries made their currencies convertible into gold at fixed prices per ounce

2.2. There were virtually no restrictions on international financial transactions

2.3. the United Kingdom lent overseas as much as half its national saving, financing the economic development of the Americas, Australia, India, and other realms of the British empire in Asia and Africa

3. Affects markets of three kinds

3.1. Commodities

3.1.1. goods and services of all varieties

3.2. Labor

3.2.1. workers who produce goods and services

3.3. Assets and Debts

3.3.1. securities, bank loans and deposits, titles to land and physical capital

4. "Trilemma" of international economists

4.1. A fixed rate of exchange between its currency and other currencies

4.2. Unregulated convertibility of its currency and foreign currencies

4.3. A national monetary policy capable of achieving domestic macroeconomic objectives