The Recycling of Petrodollars

Christopher Kopper

Revue d'Économie Financière, 2009, vol. 9, issue 1, 37-46

Abstract: [eng] The trading market for the petrodollar revenues emerged before the first oil price crisis, but did not blossom before the quadrupling of the oil price between 1973 to 1974. The little taxed and unregulated market for dollar deposits, bonds and loans at London, the most prominent finance place in Europe, proved to be the perfect institution for the recycling of the OPEC countries payment surplus. The Eurodollar market in London channelled their short-term surpluses back to the oil importing nations and boosted the long-term loan market for the developing nations. In the 1970s, long-term loans to developing countries became a popular outlet for the banks' liquidity surplus. But OPEC's dropping payment surplus, high interest policies in the US and threatening liquidity gaps in the commercial banking sector prompted the recall of loans which brought the debtors to the edge of illiquidity. . JEL Classification : F30, O16

Date: 2009
Note: DOI:10.3406/ecofi.2009.5489
References: View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://doi.org/10.3406/ecofi.2009.5489 (text/html)
https://www.persee.fr/doc/ecofi_1767-4603_2009_hos_9_1_5489 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:prs:recofi:ecofi_1767-4603_2009_hos_9_1_5489

Access Statistics for this article

Revue d'Économie Financière is currently edited by Association d'Économie Financière

More articles in Revue d'Économie Financière from Programme National Persée
Bibliographic data for series maintained by Equipe PERSEE ().