As economist Martin Feldstein has frequently pointed out, price stability also permits tax laws, accounting rules, and the like to be expressed in dollar terms without being subject to distortions arising from fluctuations in the value of money. 3 Economists like to argue that money belongs in the same class as the wheel and the inclined plane among ancient inventions of great social utility.
Following defaults on the part of several emerging market borrowers, the international community realised the need to resolve financial crises in a more orderly fashion and to improve sovereign debt restructuring mechanisms. Debtor countries and private investors agreed on best practices and guidelines for information-sharing, dialogue and close cooperation both in normal times and in periods of financial distress.