The US did all the classic things that helped the world become more dollarized. Its banks increased their operations and lending in foreign markets. In 1965, only 13 US banks had foreign branches. By 1970, 79 banks had them, and by 1980 nearly every major US bank had at least one foreign branch, and the total number of branches had grown to 787. Global lending boomed. However, as is also typical, a) those who prospered overdid things by operating financially imprudently while b) global competition, especially from Germany and Japan, increased. As a result, American lending and America’s
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