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How Do You Define the Global Financial System?
The global financial system, also known as the GFS, is a massive, all-encompassing system comprised of regulators and international institutions that operate on a global scale. If you thought domestic economics were challenging, just imagine the complications of overseeing a global economy. Needless to say, it’s a difficult endeavor to regulate such a massive system. The GFS is macroeconomics at the highest level.
International Monetary Fund
The International Monetary Fund, or IMF, is perhaps the best-known institution regarding global finances. It counts 187 countries in its membership to date. The IMF’s history is a long one, with the organization being founded in 1944. The institution was founded to try to stabilize foreign exchange rates. That stability eventually led to the forex trading we see today in forums like UFX Markets.
The G20
With the increasing globalization of the world’s markets, financial lines are being blurred or crossed like at no other time in the world’s history. In recent years, the lack of regulation in the global market has led to concern voiced by many of the world’s leaders. In 1999, the Group of Twenty Finance Ministers and Central Bank Governors, or G20, was created. The G20 is a collection of 20 economic heads from leading countries around the world. The G20′s member nations are estimated to include over 85% of the world’s GDP. The G20 meets frequently to discuss the problem of global financial regulations. Unfortunately, the G20 is often split about what should be done about world regulations.
