Lecture 9. Finance: Debt and the Power of Creditors

This is the second of two lectures on the global transaction of finance. The focus of this lecture is on the power which is secured by creditors through the holding of external sovereign debt. The first part of the lecture attempts to describe the basics of the relationship and illustrates the contemporary issue of debt and austerity through some examples in recent history. The second part of the lecture illustrates the problems by examining the history of other sovereign external debt in the 1980’s and 1990’s with special reference to the IMF programmes of structural adjustment. The argument is made the IMF acted as a debt collector for investment banks and insisted on a model of political economy conducive to debt repayment. The lecture concludes with highlighting the political problems with the impact of the current global financial power.

12 slides

1. Introduction: Politics of Money and Finance

2. Banks and Corporation Compared by Market Capitalisation June 2009

3. Cross-Border Portfolio Flows (largest 30 countries) 2008

4. Money, Financialisation, and Finance

5. Power and the Global Financial Transaction

6. The Politics of Foreign Currency and Exchange

7. Exchange Rate Manipulation and Political Outcomes

8. The Politics of Lending and Borrowing

9. Private and Public External Debt as Percentage of GDP (2009)

10. The Politics of Borrowing

11. Global Lenders and Borrowers 2007

12. Global Politics and the Debt Explosion