What Drives Financial Globalization?

The video discusses the current state of financial globalization, noting that while the expansion of cross-border financial assets is slowing, it is not reversing. It explains how financial globalization is measured using metrics like the stock of cross-border financial claims and liabilities, and the IMF's proxy for financial globalization. The video also explores factors influencing the pace of globalization, such as global trade, economic growth, and regulation, highlighting the shift from bank credit to bond markets as a key trend.

What is the current trend in the expansion of cross-border financial assets?

• It is rapidly increasing.

• It is slowing down but not reversing.

• It is unaffected by global trends.

• It is reversing completely.

Which metric is commonly used to measure financial globalization?

• Local currency exchange rates

• Domestic stock market indices

• National GDP growth rates

• Cross-border financial claims and liabilities

How have international debt securities changed since the financial crisis?

• They have remained stable.

• They have disappeared from the market.

• They have decreased significantly.

• They have expanded significantly.

What is one factor that has contributed to the decrease in cross-border bank credit?

• Reduction in bond market activity

• Stable global economic growth

• Decrease in global trade as a proportion of global output

• Increase in global trade

Which market has become a more prominent driver of financial globalization?

• Bank credit market

• Real estate market

• Cryptocurrency market

• Bond market