In the context of the development of large capital markets, the development of stock exchanges, increasingly globalized and related, the importance of globalization of financial markets, including capital markets and stock exchanges, is increasing.
On these capital markets, there are also increasingly larger, more nationally operating investment banks and investment funds, whose profits are increasingly generated from speculative transactions of securities issued by companies and the public sector, including Treasury bonds of other countries.
In addition, there are growing currency markets, which are also speculatively operated by interneconegally operating banks and investment funds, hedge funds.
The recent global financial crisis that appeared in autumn 2008 was an example of the increase in potential systemic credit risk in many countries in which the governments of these countries through the issue of government bonds and their sale to foreign investors led to a significant increase in the risk of a liquidity crisis in the state finances and in many smaller economies, they generated major crises in the debt of state finances.
In view of the above, I am asking you the following question:
Does the globalization of financial markets and the development of growing global banks and investment funds increase the level of potential systemic credit risk, increases the risk of destablization on many capital markets and thus increases the likelihood of generating another global financial crisis?
Do you agree with my opinion?
In view of the above, I am asking you the following question:
Does the globalization of financial markets and the development of growing global banks and investment funds increase the level of potential systemic credit risk, increases the risk of destablization on many capital markets and thus increases the likelihood of generating another global financial crisis?
Please reply
This issue is described in the following publication:
Article CURRENT AND HISTORICAL DETERMINANTS OF GLOBALIZATION PROCESSES
I invite you to discussion and scientific cooperation
Best wishes
Dear Friends and Colleagues of RG
The above discussion inspired me to the following considerations:
Since the beginning of the nineties, globalization processes have also been progressing faster in Poland. One of the sectors of the Polish economy in which globalization is proceeding relatively quickly is the financial sector, especially commercial banking. This is related to the acquisition of Polish banks by foreign financial institutions, i.e. the process that most intensively occurred in the 90s of the last century. In addition, Poland's accession in 2004 to the structures of the European Union and the development of electronic banking, the development of technologies and Internet services are factors that have accelerated globalization processes in Poland in recent years. The high level of globalization also applies to the capital market, both from the side of the organization and the nature of transactions made at the Warsaw Stock Exchange. The result of this high level of globalization of financial markets in Poland was the rapid appearance of negative market and cyclical effects of the global financial crisis in the autumn of 2008. The source of this crisis was the acceptance of an excessively high level of credit risk in US investment banks. However, the negative economic consequences of this crisis also quickly appeared in Poland. In addition to the significant depreciation of market valuations of shares of companies listed on the War-saw Stock Exchange, significant macroeconomic effects have also appeared in the form of a decline in the economic growth of the Polish economy. The existing situation indicates the need to continue the improvement of banking prudential regulations and credit risk management instruments in financial institutions.
Do you agree with my opinion?
Please reply
This issue is described in the following publication:
Article GLOBALIZATIONAL AND NORMATIVE DETERMINANTS OF THE IMPROVEMEN...
I invite you to the discussion
Best wishes
I described the problem of "GLOBALIZATIONAL AND NORMATIVE DETERMINANTS OF THE IMPROVEMENT OF THE BANKING CREDIT RISK MANAGEMENT IN POLAND" in the publication:
Article GLOBALIZATIONAL AND NORMATIVE DETERMINANTS OF THE IMPROVEMEN...
I invite you to discussion and cooperation.
Best wishes
The contagion effect has little resistance between countries and national capital markets with globalization thereby magnifying the systemic risk. Prior to globalization each country and its capital market was somewhat self-contained with essentially a fire wall at the national boundary. This impeded and in some cases stopped the spread from country to country resulting in much reduced systemic risk.
Dear Emmanuel V Murray,
Thank you very much and best regards,
Dariusz Prokopowicz
Dear Raymond A K Cox,
Yes, I agree with your opinion that the processes of economic globalization cause an increase in cross-border flows of certain economic processes and cyclical changes in the financial markets, capital markets, etc.
Best wishes,
Dariusz Prokopowicz
Globalization of financial markets is determined, inter alia, by international activities of banks and investment funds and an increase in capital concentration as part of mergers and acquisitions of financial institutions. This may increase systemic financial risk, including credit risk, on an international scale. This may have a significant impact on the genesis of possible future financial crises.
What do you think about it?
Best regards,
Dariusz Prokopowicz
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