An assessment of the global impact of the financial crisis / edited by Philip Arestis, Rogâerio Sobreira and Josâe Luis Oreiro.o.

Includes bibliographical references and index.

Introduction / Philip Arestis, Rogeŕio Sobreira, and Jose ́Luis Oreiro -- Current crisis in the US and economic policy implications / Philip Arestis and Elias Karakitsos -- The global economic and financial crisis : which way forward? / Ajit Singh and Ann Zammit -- Crises and the Bretton Woods institutions and the crises of the Bretton Woods institutions / Howard Stein -- Crisis in the euro zone / Jonathan Perraton -- The impact of the current crisis on emerging market and developing countries / Jesus Ferreiro and Felipe Serrano -- The crisis in western and eastern EU : does the policy reaction address its origins? / Oz̈lem Onaran -- The impact of the subprime financial crisis on the transition and Central Asian economies : causes and consequences / Nigel F.B. Allington and John Place of publication not identified McCombie -- The world financial crisis and the implications for China / Shujie Yao and Jing Zhang -- The 2008 financial crisis and banking regulation in Brazil / Luiz Fernando de Paula and Rogeŕio Sobreira -- Exchange-rate derivatives, financial fragility and monetary policy in Brazil during the world financial crisis / Jose ́Luis Oreiro and Flavio Basilio.

The 2008 financial crisis hit the heart of capitalism, but the effects were much weaker in the 'periphery' of the capitalist system than in its center. This book provides a solution to this paradox. The analysis presented here shows that current account surpluses and accumulation of foreign reserves are important for developing countries because they allow them to conduct anti-cyclical policies in the face of a financial crisis in developed countries. Stabilization of output is important for robust growth in the long term due to its effects over capitalist animal spirits. Developed countries should never pursue a growth strategy based merely on accumulation of 'foreign savings'. This book presents an extensive and in-depth analysis of the crisis as it influenced both developed and developing countries. It is shown that the impact of this crisis is far from being homogenous across the developed and developing world. The most intriguing aspect of it is the fact that it affected less those economies responsible for the generation of the 'global savings glut', and more those economies that are more dependent on foreign capital inflows. In this aspect, the book also addresses the question of why this crisis has been rather limited in magnitude and of such relatively short duration. It is also shown that financial liberalization alone cannot fully explain the crisis. It is necessary to take a good look on the size of the financial sector all over the world and the redistributive impact related to it. Thus, one of the main lessons that can be learned by this volume is a profound need to implement policies that can guarantee financial stability.