GEOG 216 Lecture Notes - Eurodollar, Lux, Fixed Capital
23 Nov 2012
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Opec: saudi arabia, kuwait, iran, iraq, qatar = maj oil producers. Oecd: 24 wealthiest countries in world = maj oil consumers. Lender: charges borrow interst/% of outstanding loan ea/year. Borrower: pays back part of the borrowed $, principle" + interest. Concessional lending: loans below market rates of interest/interest-free loans + grants. Rapid wealth accumulation in wealthy nats, n am not damaged by war. Western banks invested very little in poor nats (maybe in their colonies) Would only loan small amounts of $ over long periods of time. Strict + fixed condits for these risky loans. Poor nats didn"t hav enough collateral to get investment fr/normal banks (risky investment) Period of building of eurodollars in w eur bnks. Individs, firms, nats, move $ into w banks w/more relaxed regulations (off paper trail) H: these regions could get concessional lending" fr/imf/wb. Usa not able to track all their currencies. Opec cartel decreases oil supply, oil prices rise.
