Exchange-rate Books

If you wanted to know really what is going on in the EC, this is the book to read. It will give you insights into the political systems, which influences the monetary system, trading and the agenda they are following. Not to mention their bullying of countries to get their way.

When was the last time in a civilized, DEMOCRATIC society have we seen free speech outlawed? How about now. Now in the EU it is against the lau to express you opinion, your criticism, of what the political beast is doing. That means you cannot speak out against wrong doings of institutions and political figures.

That ruling alone did away with British common Law and over 50 years of european civil liberties. Where will it end? A totalitarian regime?

Some say THAT is just around the corner.

The author of this book got into HOT water for writing it. I hope this is not something that will foreshadow this type of activity happening here.

This book is a wake up call. If it is happening in the EU, what kind of ramifications will fall on us?

I have bought this as a present for friends interested in monetary policy and international affairs. I shudder to think of the impact the EU will have with a weakened US international policy. I can only envision them as growing threat to us economically and shudder to think of how a potentially fascist EU.

Buy this book.

Bernard Connelly has written the consummate "expose" on the Maastricht treaty and the process of European monetary integration. Connelly, a former member of the European Commission, blows the lid off the Maastricht treaty and the intransigence of Jaques Delors and the Kohl-Mitterand relationship, which led to the European Monetary Union (EMU) provisions in Maastricht. This is at heart story of the politics of monetary policy, especially the failed Exchange Rate Mechanism (ERM), with three primary themes: the primacy of politics in determining monteray policy, the role of "vision" and "ideology" in determining policy, and the comedy of errors which was the ERM. One should not let the economics of this book prevent them from reading it. At heart, this is a great story and has the intrigue of the best historical novel. Connelly has written a factual tale containing a heroine (Baroness Thatcher), villians (Delors, Kohl, Trichet, Mitterand, Tietmeyer), and Alphandery, the innocent whistle-blower who brings the ERM crashing down. Connelly provides any reader interested in knowing about the lunacy of European monetary integration just why this idea is flawed, and provides economic evidence to defend his primary arguments. Among the more important and convincing conclusions reached in this work are: the necessity of flexible exchange rates, the inherent negatives of Europhilism (and especially Franco-philism, since "Europe" is seen as way to prevent the rise of "Anglo-Saxon" institutions), and the belief in free, competitive markets. A final comment one feels obligated to make about this book is its timeliness, and his villification of France, which is supported by following the recent row over the control of the European Central Bank. If one wants to read one book on why the EMU was really founded, and why it won't work-this is the book.

Bernard Connolly was fired by the European bureaucrats after this book came out. If you read this book you will understand why. This book has all the detail you could ask for. It is an incredible expose of the events leding up to European Monetary Union.

If you support the European Community, reading this book will change your mind -- if you dare read it.

Excellent work. The reality at the core of all the pomp-and-circumstance surrounding EMU. Read it and be wiser.

Review of The Rotten Heart of Europe: the dirty war for Europe's money, by Bernard Connolly, Faber & Faber, 1995, £17.50.

THIS BRILLIANT book is a devastating exposure of the pretensions of those who want to rule Europe. It shows that the attempts to achieve monetary and economic union, and consequently political union, are bad for us. They will not bring monetary stability, economic growth or political harmony. Instead they will destabilise currencies, reduce growth and promote hatred between the nations of Europe.

Economic and Monetary Union (EMU) is supposed to build on the experience of the Exchange Rate Mechanism (ERM). Britain's membership of the ERM forced us into a disastrous and quite unnecessary recession. After two years of suffering, Major said in July 1992 that Britain would soon be the leader of the ERM. Two months later, we were well out of it, and ERM had bermbed, as Jacques Clouseau, Major's mentor, would say.

ERM constrained British Government policy on non-monetary matters too. The Government appeased Spain over the fishing dispute to keep Spain happy about the sterling/peseta rate. So the Common Fisheries Policy, so damaging to Britain's fishing industry, is not an isolated EU aberration: it stems from the whole logic of economic and monetary union.

The ERM was described as the Eternal Recession Mechanism; EMU is likely to be Even More Useless. The ERM kept the poor countries poor; it did not help them to converge; it certainly did not help them to meet the Maastricht criteria. Spain's experience of ERM was catastrophic: 22% unemployed. The ERM forced Denmark into recession: unemployment doubled to 12%, the budget was slashed, and investment, output and wages all fell. In the ERM, Ireland's unemployment soared from 11% to 23%. ERM subordinated nations' economic interests to minorities' foreign policy goals: ruling class interests dominated working class interests. Some still claim that ERM and EMU could control capital, but actually they were and are attacks on the working class.

A 1992 report by the Monetary Committee, which advises the EU's Council of Ministers, admitted that ERM did not stabilise prices or money and did not reduce inflation. Perhaps it was after all just a tool for moving countries towards political union.

The book also depicts the present dangerous struggle between the French and German ruling classes for control over the proposed institutions of a single European state. Germany is determined to keep the Deutschmark and the Bundesbank: it wants EMU so that it can assimilate other countries into an expanded Deutschmark zone. France wants a new currency and wants to get its hands on the Bundesbank; it pushed for the Maastricht Treaty, which would destroy the Deutschmark. Who would control Europe's currency? Who would control the proposed new European Central Bank? Germany or France?

As Wilhelm Nolling, a Bundesbank Council member, said: "We should be under no illusion - the present controversy over the new European monetary order is about power, influence and the pursuit of national interests."

They are already fighting about the 1996 InterGovernmental Conference. Germany wants the economic criteria for EMU met as soon as possible: it insists that economic convergence must precede monetary union. France wants the earliest possible date for monetary union, believing that monetary union would produce economic convergence. Both are wrong of course: convergence cannot and will not be achieved, either way.

EMU's implications are universally unpopular. The workers of France, Italy and Belgium are striking against the EU's schemes. The Austrian Government fell in October, unable to pass the EU-required budget.

We can see both from ERM's effects, and from the effects of the attempted imposition of the Maastricht criteria, how damaging membership of EMU would be. It would cause, as intended, a permanent lowering of wages, a permanently higher level of unemployment, and massive cuts in public spending.

Connolly sums up: "My central thesis is that the ERM and EMU are not only inefficient but also undemocratic: a danger not only to our wealth but to our freedoms and ultimately, our peace. The villains of the story - some more culpable than others - are bureaucrats and self-aggrandizing politicians. The ERM is a mechanism for subordinating the economic welfare, democratic rights and national freedom of citizens of the European countries to the will of political and bureaucratic elites whose power-lust, cynicism and delusions underlie the actions of the vast majority of those who now strive to create a European superstate. The ERM has been their chosen instrument, and they have used it cleverly."

Sarno and Taylor placed different approachs of the Exchange Rate teory in this book.

This is a well-written and comprehensive survey of the modern international finance literature. I recommend this book to PH.D students who looking for a dissertation topic. Researchers should also have a copy of this book for reference.

An excellent book for experts on foreign exchange, covering most of the major theories in detail. Often said to be at PHD level, which is true, but the difficult mathamatics is avoided as much as possible so is accesable to all those with a good knowledge of exchange rate theory.

Ten years ago, by coincidence, I saw this book. I bought it, and since then I have recommended it to all my colleagues.
At that time, the book was new and contained all the most recent developments in the journals (it ends with hysteresis - well explained and at that moment a brand new topic in the journals).
But what I find more important is that this is the only book I read where all those journal-stuff was fitted into a coherent frame-work; for the first time I really understood what macro-economics (and their micro foundations) was all about.
Up till then, I had seen only fragmented pieces of macro theory and here these authors came with a coherent view, which would have taken myself years to fit together, and I was sorry that this was not the handbook I had at university.
I don't follow-up this field anymore, and the book has not been updated anymore since then (a pity I think) but I write this review out of gratitute for the insights the authors gave me: I finally realized that in this book all the pieces were fitted together and allowed me to really understand macro-economics.
Personally, I can only recommend it.

Most of the textbooks in macroeconomics (Blanchard, Mankiew and Gordon) focus on basic IS-LM and AS-AD models which are useless in open economies. This book is perfect upgrade for everybody who has read basic macroeconomics textbooks and wants to go further. There is economic history review, everithing is based on imperfect labour markets and salter-swan diagram is perfectly implemented in standard macroeconomics tools together with IS-LM model.

One of the best macroeconomics textbooks in the market.First of all it contains an excellent chronological survey of models. But above all, its approach based on wage bargain and mark-up pricing has great relevance in terms of real world phenomena, in contrast to most mecroeconomic textbooks based in the unrealistic competitive model. The main contribution is to set an scenario for a feasible and intelligent social negotiation and for economic policy, instead of definitive "natural" outcomes of economic performance. I hope the authors keep on updating this book

Jorge Ibarra. National University of Mexico

In Controlling Currency Mismatches In Emerging Markets, Morris Goldstein (Dennis Weatherstone Senior Fellow at IIE) and Philip Turner (Head of the Secretariat Group in the Monetary and Economics Department, Bank for International Settlements) collaborate in revealing and dealing with past and present weaknesses in economic policies and institutions in contemporary and emerging markets around the globe. But more than a simply litany of flawed policies and economic ills, the authors present an effective and practical plan of action to control currency mismatches through a managed floating currency regime, an inflation targeting regime for monetary policy, regular publication of data on currency mismatches at the sectoral and economy wide levels, stepped up supervision and monitoring of currency mismatches in banks and in the loan customers, changes in official safety nets and in IMF policy conditionality, implementation of more prudent debt and reserve management policies in emerging economies, and a higher priority with respect to developing domestic bond markets, hedging instruments, and reduced barriers respecting foreign-owned banks within emerging economies. Informed and informative, Controlling Currency Mismatches In Emerging Markets is a sold work of seminal research and strongly recommended reading for policy makers with respect to international economic issues.

The Book gives an excellent comparative account of these important central banks, while covering with detail the macroeconomic intricacies of monetary policy decision making in these nations. It also includes a fascinating and detailed exposure of the historical developments in these cntral banks. A must for anyone trying to understand the current global central bank framework.

Immediately apparent is Professor Corden's adeptness in narrative explanation: he can convey complex concepts using actual words (rather than relying heavily on drawings and symbols).

He also stretches basic models to convey a more complete picture. For example, he develops the simple Mudell-Fleming model to include real-world effects of disturbances, such as those on wages and real-money supply.

This book provides intensive and comprehensive understanding about the exchage rate mechanism that is essential in understanding international business. The book is well organized and composed of excellent works on each of the subjects such as macroeconomic policy, balance of payments, purchasing power parity, forcasting models, monetary and fiscal policy, and empirical general equilibrium model. Recommended for in-depth understanding in this area. To understand this book better, two books are recommended: Applied Econometric Time Series by Enders and Empirical Evidence on the Efficiency of Forward and Futures Foreign Exchange Markets by Hodrick.

This book (contemporary science fiction) really gallops along. It is hard to catch your breath as the two main (and dysfunctional) characters go at each other at an increasingly furious pace. At times I found myself rooting for George Larson, even if he is despicable. Clever premise and plotting. Exchange Rate was a quick read, but for several days afterwards I was musing what I would have with the powers they were granted.

An excellent book for the non-expert, going through all the various ways of looking at and forecasting exchange rates. Simple and easy to read and a quick reference guide for all os us. By non-expert I mean someone with an economics background or who works in financial markets but who does not specilise in FX. Complete beginers may need a more basic book with more theory. Specialists may still find it useful but the lack of detail and references can sometimes be frustrating.

The book, from one of the experts on the subject, nicely covers the key theories on exchange rate determination. Strictly for academics or experts. Topics include: PPP and its variants (in depth), real exchange rate determination, new open macroeconomics, economics of fixed exchange rates, the microstructure approach, and UIP. The focus is sometimes more on providing the theory rather than the results and implications. Relative to "The economics of exchange rates" by Sarno and Taylor this book is more mathematical (but not excessively so) but while they cover some similar ground they should be seen as a supplements rather than an alternatives.