понеже ивайло за пореден път се опитва нескопосано да манипулира, ето едно
изследване за възникването на евродоларите и евродоларовия пазар.
---8<---
The Origins of the Eurodollar Market in London: 1955–1963
Catherine R. Schenk
Department of Economic and Social History, University of Glasgow
The Eurocurrency market is arguably the most dramatic financial innovation in the post-war period yet very little is known about its origins. This paper examines two facets of the Eurodollar market: why it happened and
why London kept most of the business. Using archival evidence, this
article reveals that Eurodollars were accumulated earlier than has
hitherto been thought. This has important implications for how we
interpret the factors prompting the innovation. High interest rates, self- regulation by banks, and changes in access to the forward exchange market combined in mid-1955 to encourage innovation by the Midland Bank. The
major source of competitive advantage for London was the regulatory environment which combined tight money in the domestic economy with
relative freedom in international finance.
The accumulation of foreign currency deposits by London banks was not a
new phenomenon in the 1950s. Customers had long been allowed to deposit their US$ or other currency at banks in London. Indeed, there had been a growth in such deposits in the interwar period, which had only ended with the imposition of exchange controls and the collapse of the international monetary system in the 1930s.2 In the immediate postwar period exchange controls prevented the re-emergence of this practice, but by the early
1960s observers became aware of a growth in $US deposits from overseas, mainly by Europeans and mainly in London banks. These deposits are usually identified as being on a much larger scale in the postwar period than in earlier times, and also the funds were put to a distinctive use by the borrowers.3 Instead of immediately remitting the foreign currency to the central bank or depositing it in their accounts in the U.S., banks used their dollar deposits for loans to third parties either in the U.K. or abroad.
The dramatic acceleration of this new source of international capital from the 1960s is now a familiar tale in the existing literature.4 The origin
of the financial innovation, however, is less well understood, partly because published statistics on the size of the market are only available from 1963.5 This paper will focus on the period 1955–63 in order to interpret the factors that generated the innovation. The period begins
with the first dollar deposits attracted for investment in the U.K. and
ends with the relaxation of Regulation Q and the first Eurobond issue in 1963. Until July 1963, Regulation Q in the U.S. restricted interest
payable on 30-day deposits to a maximum of 1% and on 90-day deposits to 21⁄2%.6 The analysis offers new evidence that establishes the emergence of the market at an earlier date than has hitherto been suggested. This has important implications for how we interpret the determining factors behind the innovation. This case also stresses the need to distinguish between environmental pressures for innovation and precipitating factors.
The Eurodollar market emerged during a key period in the history of the international monetary system. During the 1950s, the U.K. moved closer to the Bretton Woods goals with a more realistic commitment to current
account convertibility and freer trade. At the same time, however, British policy-makers felt under continual threat from inflationary pressures at home which they countered with attempts to control the money supply and periodic returns to direct controls on the economy. At the end of 1952 the British government committed itself publicly to liberalizing trade and payments. External current account convertibility was achieved de facto by the official support of the transferable sterling exchange rate in March 1955, and official convertibility was announced (in common with most other West European countries) at the end of 1958. Although the government was committed to freer current account transactions, policy on capital flows
was inconsistent. In 1954 the restrictions on British banks operating in
the forward exchange market were lifted. In 1955, interest rates were
raised sharply in response to a confidence crisis and domestic
inflationary pressure. New capital controls were introduced in 1957 in response to a threatened drain on the reserves. These contradictions in policy between liberalization and attempts to mitigate its affects
generated opportunities for profitable innovation which led to the
emergence and growth of the Eurodollar market in this period.
…
---8<---
цялата статия е достъпна на долния адрес:
https://www.sfu.ca/~poitras/EEH_Eurodollar_98.pdf
и си струва да се прочете (imho).
--
«地 球 誕 生 在 牛 市 的 小 時 — Earth is born in the Bull's hour»
On Thursday, April 6, 2023 at 3:52:45 PM UTC-4, Nick wrote:
понеже ивайло за пореден път се опитва нескопосано да манипулира, ето
едно изследване за възникването на евродоларите и евродоларовия пазар.
Ха-ха-ха! Подскочи като попарен, а? :-D
Иначе интересно четиво.
---8<---
The Origins of the Eurodollar Market in London: 1955–1963
Catherine R. Schenk Department of Economic and Social History,
University of Glasgow
The Eurocurrency market is arguably the most dramatic financial
innovation in the post-war period yet very little is known about its
origins. This paper examines two facets of the Eurodollar market: why
it happened and why London kept most of the business. Using archival
evidence, this article reveals that Eurodollars were accumulated
earlier than has hitherto been thought. This has important implications
for how we interpret the factors prompting the innovation. High
interest rates, self-
regulation by banks, and changes in access to the forward exchange
market combined in mid-1955 to encourage innovation by the Midland
Bank. The major source of competitive advantage for London was the
regulatory environment which combined tight money in the domestic
economy with relative freedom in international finance.
The accumulation of foreign currency deposits by London banks was not a
new phenomenon in the 1950s. Customers had long been allowed to deposit
their US$ or other currency at banks in London. Indeed, there had been
a growth in such deposits in the interwar period, which had only ended
with the imposition of exchange controls and the collapse of the
international monetary system in the 1930s.2 In the immediate postwar
period exchange controls prevented the re-emergence of this practice,
but by the early 1960s observers became aware of a growth in $US
deposits from overseas,
mainly by Europeans and mainly in London banks. These deposits are
usually identified as being on a much larger scale in the postwar
period than in earlier times, and also the funds were put to a
distinctive use by the borrowers.3 Instead of immediately remitting the
foreign currency to the central bank or depositing it in their accounts
in the U.S., banks used their dollar deposits for loans to third
parties either in the U.K. or abroad.
The dramatic acceleration of this new source of international capital
from the 1960s is now a familiar tale in the existing literature.4 The
origin of the financial innovation, however, is less well understood,
partly because published statistics on the size of the market are only
available from 1963.5 This paper will focus on the period 1955–63 in
order to interpret the factors that generated the innovation. The
period begins with the first dollar deposits attracted for investment
in the U.K. and ends with the relaxation of Regulation Q and the first
Eurobond issue in 1963. Until July 1963, Regulation Q in the U.S.
restricted interest payable on 30-day deposits to a maximum of 1% and
on 90-day deposits to 21⁄2%.6 The analysis offers new evidence that
establishes the emergence of the market at an earlier date than has
hitherto been suggested. This has important implications for how we
interpret the determining factors behind the innovation. This case also
stresses the need to distinguish between environmental pressures for
innovation and precipitating factors.
The Eurodollar market emerged during a key period in the history of the
international monetary system. During the 1950s, the U.K. moved closer
to the Bretton Woods goals with a more realistic commitment to current
account convertibility and freer trade. At the same time, however,
British policy-makers felt under continual threat from inflationary
pressures at home which they countered with attempts to control the
money supply and periodic returns to direct controls on the economy. At
the end of 1952 the British government committed itself publicly to
liberalizing trade and payments. External current account
convertibility was achieved de facto by the official support of the
transferable sterling exchange rate in March 1955, and official
convertibility was announced (in common with most other West European
countries) at the end of 1958. Although the government was committed to
freer current account transactions, policy on capital flows was
inconsistent. In 1954 the restrictions on British banks operating in
the forward exchange market were lifted. In 1955, interest rates were
raised sharply in response to a confidence crisis and domestic
inflationary pressure. New capital controls were introduced in 1957 in
response to a threatened drain on the reserves. These contradictions in
policy between liberalization and attempts to mitigate its affects
generated opportunities for profitable innovation which led to the
emergence and growth of the Eurodollar market in this period.
…
---8<---
цялата статия е достъпна на долния адрес:
https://www.sfu.ca/~poitras/EEH_Eurodollar_98.pdf
и си струва да се прочете (imho).
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