GEOG 106 Lecture Notes - Lecture 9: Structural Adjustment, Global Recession, Neoliberalism
Document Summary
Debt, inequality, and global poverty management 3. The development of the debt crisis 3. 1. When the dollar was allowed to float in the market and fall in value. Rapid price rises for basic staple commodities. These effects were debilitating for developing countries. Opec and other commodity cartels invested in banks in london instead of the us. The money then loaned out without the demands for minimal cash reserves that applied in the us itself. Resulted in reckless and aggressive lending practices which led to indebtedness for many developing countries. Overall value of their dollar denominated debts became much larger via-a-vis the payment power of their own domestic currencies. Global economic downturn in export markets because of high interest rates in europe and north america. Widespread increases in poverty, unemployment, ill-health, famine, disease, child mortality, political instability, and civil war in indebted developing countries.
