International
Financing with
Eurobonds
by CHRISTOPHER H. ROBINSON
It seems that whatever area of the globe
one looks at there are serious economic
problems. Even the mighty dollar has come
under pressure as the USA experiences its
first taste of balance of payments deficits
—not that a large balance of payments surplus
is a pleasant situation as Germany is
finding out.
As the balance of payments problems
increase so do the financial restrictions
imposed by governments to correct them.
And with efforts to maintain currency
values and to combat inflation, credit positions
are getting tighter.
As a result of these trade deficits, overseas
spending on defense and various
forms of foreign aid, many different currencies
have been found in the past few
decades in the international money market
in various proportions. As national economies
have gone tight on credit and finally
the seemingly endless supplier of funds
—New York—was shut off to foreign borrowers
in 1963 by the interest equalization
tax, this international money pool has become
the source of international finance
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