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This required the liberalization of international credit and financial markets, and the US government began actively to promote and support this strategy globally during the 1970s. Hungry for credit, developing countries were encouraged to borrow heavily, though at rates that were advantageous to the New York bankers.23 Since the loans were designated in US dollars, however, any modest, let alone precipitous, rise in US interest rates could easily push vulnerable countries into default. The New York investment banks would then be exposed to serious losses.
A Brief History of Neoliberalism
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