> For the complete documentation index, see [llms.txt](https://laurence-wilse-samson.gitbook.io/textbooks/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://laurence-wilse-samson.gitbook.io/textbooks/global-finance-a-money-view/readme.md).

# Introduction

> **Revised full draft, last updated November 2026.** One of 22 textbooks freely readable online ([all books](https://lwilsesamson.com/textbooks/)), all written with AI assistance. Corrections are welcome at <laurence@lwilsesamson.com>. See the [status of this edition](/textbooks/global-finance-a-money-view/edition-status.md).

***

## About This Book

This textbook presents international finance through the lens of Perry Mehrling's "money view" framework. It treats international finance as a subject in its own right rather than an application of macroeconomic models, and starts from the institutional plumbing of global finance: the hierarchy of money, balance sheet mechanics, the dealer function, and the survival constraint that binds all financial institutions.

The dollar stands at the apex of the international monetary system, so international finance cannot be understood without knowing how dollars are created, transferred, and destroyed, both onshore and offshore. The book traces dollar flows through correspondent banking networks, Eurodollar markets, central bank swap lines, and shadow banking chains.

Companion: [Balance of Power](https://balanceofpower.lwilsesamson.com/), an interactive data companion to this book.

***

## Key Themes

### 1. The Hierarchy of Money

Money is a hierarchy of promises to pay. At the top sit central bank reserves; below them, bank deposits; below those, various forms of private credit. Internationally, currencies themselves form a hierarchy, with the dollar at the apex. Financial crises invariably involve flights up this hierarchy.

### 2. Balance Sheets Matter

Every financial transaction creates matching assets and liabilities on someone's balance sheet. The money view traces these balance sheet effects. When a European bank makes a dollar loan, where does the dollar come from? When the Fed conducts quantitative easing, whose balance sheet expands? Balance sheet analysis shows the actual mechanics of finance that aggregate models obscure.

### 3. The Dealer Function

Financial markets depend on dealers who stand ready to buy and sell, absorbing temporary imbalances in supply and demand. Dealers provide liquidity but face their own constraints. When dealer balance sheets become impaired, markets seize up. The Fed's crisis interventions can be understood as stepping in when private dealers fail.

### 4. The Survival Constraint

The binding constraint on any financial institution is liquidity, the ability to meet cash outflows when they come due, rather than solvency. A bank can be solvent (assets exceed liabilities) but fail because it cannot meet a deposit run. Internationally, countries face survival constraints in foreign currencies they cannot print.

***

## Structure

The book is organized in seven parts:

| Part                        | Chapters | Focus                                                   |
| --------------------------- | -------- | ------------------------------------------------------- |
| **I. Foundations**          | 1–3      | Money view framework and international dimension        |
| **II. Money Markets**       | 4–6      | Fed funds, repo, payments, Eurodollars                  |
| **III. Intermediation**     | 7–10     | Banks, shadow banks, private credit, corporate treasury |
| **IV. Capital Markets**     | 11–14    | FX, bonds, derivatives, equities                        |
| **V. Central Banks**        | 15–16    | Operations and international cooperation                |
| **VI. Crises**              | 17–20    | Currency crises, balance sheet crises, GFC, Eurozone    |
| **VII. Periphery & Future** | 21–27    | Emerging markets, case studies, digital transformation  |

***

## For Instructors

This textbook is designed for:

* **Graduate courses** in international finance, international monetary economics, or financial institutions
* **Advanced undergraduate courses** with prerequisites in intermediate macroeconomics and basic finance
* **Policy professionals** who want to understand global financial plumbing

Each chapter includes:

* Detailed balance sheet illustrations and tables
* Connections to the money view framework
* Discussion questions and exercises
* Suggestions for further reading

***

## About the author

I am an economist in New York. I am Associate Director at Oxford Economics, I teach as an adjunct at NYU Wagner and Columbia SIPA, and I am a Senior Research Fellow at the University of Johannesburg's Centre for Competition, Regulation and Economic Development. I took my PhD in economics at Columbia. More at [lwilsesamson.com](https://lwilsesamson.com/).

All rights reserved.

***

## Acknowledgments

This textbook builds on Perry Mehrling's money view framework, developed in his courses at Columbia University and Boston University, and in his book *The New Lombard Street* (2011). The institutional detail draws on decades of research by the Bank for International Settlements, the Federal Reserve, and academic scholars of money markets and financial crises.

Special thanks to Perry Mehrling for developing the money view framework that this text applies, and to the many students whose questions shaped its exposition.

## How this book was made

I wrote this book with substantial help from AI language models, principally Claude (Anthropic), which I used for drafting, editing, figure generation, and consistency checking. The outline, the argument, the selection of material and the judgments throughout are mine, as is the responsibility for what remains wrong. Figures were generated from code using the sources identified in their captions; illustrative figures are labelled. Code may be provided on request. I also used Google Gemini for review.

In October 2026 I revised the whole text in two further passes, also with AI help: one to remove the stock phrasing that AI drafts produce, and one to bring the prose closer to my own academic writing.

I then had every checkable claim in the text (1,074 in all: numbers, quotations, attributions, dates and reported findings) compared with a primary source, using AI tools for the lookups and reviewing each change myself. Of those, 571 were confirmed, 311 corrected, 97 softened, 77 cut, and 18 could not be checked against an accessible source. This was a claim-by-claim check, not a line-by-line proofread, and errors surely remain.

Please report errors to <laurence@lwilsesamson.com>. Corrections usually go live the same day.

*Last updated: November 2026*