The vulnerability of the international financial system: international lending and liquidity risk


Since the first oil crisis in 1973, international banking has become a dominant feature of the international financial system. Both economic and technical reasons underly this evolution. The article analyses the main risks for the stability of the international monetary and financial system, produced by the rise of international banking. In particular, the causes and consequences of international lending liquidity risks are analysed and the guidelines for a safety net of the system are proposed. JEL: F34

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