The Monetary and Financial Powers of States: Theory, Dataset, and Observations on the Trajectory of American Dominance

Armijo, Leslie Elliott; Tirone, Daniel C.; Chey, Hyoung‐kyu

doi:10.1080/13563467.2019.1574293

Cited by 8 publications

(10 citation statements)

References 53 publications

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“…Emerging markets complain that as their economies expanded and their central banks felt compelled to augment their dollar reserves, they were obliged to provide cheap finance for the U.S. external deficit, like it or not. The second element of a nation's global financial stance refers to its market centrality and network power (L. E. Armijo et al, 2019). As noted by Oatley et al (2013), the IFS is a very complex network of persistent creditor-debtor relationships, in which actors frequently take multiple roles simultaneously, as creditor, debtor, or broker.…”

Section: The Third and Last Dichotomy Refers To The Distinction Betwementioning

confidence: 99%

“…The degree of financial market centrality, in turn, derives from one or more of three factors -i.e. credibility, stability, and economic size (L. E. Armijo et al, 2019). Credibility stems from the perception that a given financial market provides a business-friendly environment.…”

Section: The Third and Last Dichotomy Refers To The Distinction Betwementioning

confidence: 99%

“…Some, although by no means all, of the strains in the global economy in recent decades can be attributed to failures on this score" (Bordo & Taylor, 2017, Chapter 2). Under these conditions, the US government is capable of imposing financial sanctions by publishing blacklists, denying other countries, foreign banks and citizens access to the American financial networks (L. E. Armijo et al, 2019;Steil & Litan, 2006) This state of affairs, in fact, is one of the reason why an increasing number of emerging powers are looking for alternative routes in the IFS, as the Chinese RMBII and China International Payment System (CIPS) 41 corroborates.…”

Section: The Third and Last Dichotomy Refers To The Distinction Betwementioning

confidence: 99%

“…The third category of global financial and monetary capabilities refers to the international status of a national currency (L. E. Armijo et al, 2019). First and foremost, according to the literature (e.g.…”

Section: The Third and Last Dichotomy Refers To The Distinction Betwementioning

confidence: 99%

“…In relation to the creditor capabilities of FS (L. E. Armijo et al, 2019), China has been consolidating itself as a system-influencing state (Keohane, 1969) Chinese institutional investors (e.g. China Development Bank, Chinese Exim Bank) usually make credit decisions based on long-term horizons and relationships, geopolitical considerations (e.g.…”

Section: China`s Patient Capital 59mentioning

confidence: 99%

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China\'s financial statecraft and the internationalization of the Renminbi: what looms over Brazil\'s foreign exchange reserves?

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and South Korea as well as the European Union. 10 In 2009, the Governor of the People's Bank of China Zhou Xiaochuan called for the replacement of the dollar as the main reserve currency with a "super-sovereign reserve currency" as proposed by J. M. Keynes at the Bretton Woods Conference in 1944 (Zhou Xiaochuan, 2009). 11 Zhang (2015) refers as well to the quantitative easing programs adopted by the European Central Bank and the Bank of Japan. 12 Gao and Yu of the Chinese Academy of Social Sciences (CASS) stated this fact in 2011: "The current crisis has exposed the vulnerability of China's financial position under the existing international monetary system, which is characterised by the domination of the US dollar as the international reserve currency. Because a national currency is used as the international reserve currency, US policy aimed at crisis management has created strong externality to the rest of the world. Because China holds some USD 1 trillion in US dollar assets in its foreign exchange reserves, it has become an easy prey of American domestic policies. The value of China's foreign exchange reserves is in danger of being significantly eroded as a result of the debasing of the US dollar, which is, in turn, a result of the US government's crisis management" (BIS & BoK, 2011, p. 105). 13 As pointed out by Paul Krugman in the wake of the GFC: "China had driven itself into a dollar trap. China acquired its $2 trillion stash-turning the People's Republic into the T-bills Republic-the same way Britain acquired its empire: in a fit of absence of mind. And just the other day, it seems, China's leaders woke up and realised that they had a problem [ ] they are, apparently, worried about the fact that around 70 percent (sic) of those assets are dollar-denominated, so any future fall in the dollar would mean a big capital loss for China" (Krugman, 2009).

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Section: The Third and Last Dichotomy Refers To The Distinction Betwementioning

confidence: 99%

Section: The Third and Last Dichotomy Refers To The Distinction Betwementioning

confidence: 99%

Section: The Third and Last Dichotomy Refers To The Distinction Betwementioning

confidence: 99%

Section: The Third and Last Dichotomy Refers To The Distinction Betwementioning

confidence: 99%

Section: China`s Patient Capital 59mentioning

confidence: 99%

See 3 more Smart Citations

China\'s financial statecraft and the internationalization of the Renminbi: what looms over Brazil\'s foreign exchange reserves?

Dominguez¹

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The Monetary and Financial Powers of States: Theory, Dataset, and Observations on the Trajectory of American Dominance

Cited by 8 publications

References 53 publications

China\'s financial statecraft and the internationalization of the Renminbi: what looms over Brazil\'s foreign exchange reserves?

China\'s financial statecraft and the internationalization of the Renminbi: what looms over Brazil\'s foreign exchange reserves?

A commentary on emerging markets banking sector spillovers: Covid-19 vs GFC pattern analysis

The US-China race for technological centrality: A network perspective

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