p The export of capital has always entailed a wide range of financial and credit operations which tend to transcend the national framework and to become international. The capitals of industrial and banking monopolies of the leading imperialist countries being closely coalesced, such ties are also gradually established within the framework of the world capitalist system. Thus, the foreign operations of US industrial TNCs are serviced by the major US banks. The intensive coalescence of the capital of international industrial and banking monopolies marks a new stage in the development of the system of international domination by finance capital.

p More and more industrial and banking subsidiaries and affiliates are set up abroad by transnational financial groups: in the early 1980s, over 150 US banks had foreign departments, while their affiliates abroad numbered close to 800. International deposit, loan and clearing operations by US and West European banks over 81 the past decades have been growing much faster than similar operations at home, with the centre of gravity of many international credit operations gradually shifting from the head offices of US TNBs to their affiliates abroad.

p The development of modern facilities for storing, transmitting, and processing information has extended the potentialities for the internationalisation of banking. Communications satellites are now being ever more widely used for the international remittance of money. Automated information systems with a ramified computer network help to speed up payments and money remittances and monitor the state of the international money markets. Modern communications allow almost instant conferencing between the TNB head office and its numerous affiliates.

p The geographical location of affiliates is also noteworthy. They are concentrated above all in countries where one can expect to have complete freedom of action (without any restrictive government controls) and the lowest rate of taxation on earnings. TNBs in the United States and Britain find the Bahamas and the Cayman Islands most attractive for the location of their affiliates abroad: in the early 1980s, US TNB affiliates there had assets surpassing those of all the US TNB affiliates in Western Europe, Africa and Latin America taken together. One should also note that London continues to be the major international financial centre of capitalism. Britain, the Bahamas and the Cayman Islands now account for more than two-thirds of all inter-bank TNB operations.

p Since the Second World War, international banking groups have also sharply stepped up their operation, with the major London banking houses central to many of these. Integration processes within the EEC framework have also substantially promoted the monopoly association of West European banks.

p The national money markets have been brought ever closer together by the internationalisation of credit operations. The development of a multi-tier system of "credit intermediaries" is only one of many questions arising from the ever greater role of the TNBs in the international payments and credit mechanism of the capitalist world.

p At the early stages in the development of monopoly capitalism, capital was exported mainly in the form of "external issue", i.e., the sale of securities floated by private companies on the capital market of creditor countries. The major banks were always actively involved in this process in the role of organisers (“ intermediaries”), since only the biggest companies were in a position to enter into direct negotiations with foreign owners of capital. Nevertheless, the relations which took shape from the flotation of securities still entailed more or less direct links between borrowers and foreign owners of loan capital.

p The flotation of securities in the major international financial centres is still the most important form in which capital is exported, but over the past several decades there has been an especially rapid development of another sector of the international capital market of which deposit and lending operations by TNBs and international 82 banking groups are an organic element. Marx demonstrated that as capitalist credit develops money capital inevitably tends to “double”, “treble”, etc., since one and the same debt claim assumes diverse forms, a tendency illustrated by the practices of credit “intermediaries”, the holding of reserves belonging to specialised credit institutions, commercial banks, etc. But never before, perhaps, has the number of intermediaries operating between the owner of money capital and the ultimate borrower, and hence the scale of the "internal turnover" of money capital within the framework of the credit system been so great as in the functioning of a recent newcomer, an international capital market known as the Eurocurrency market. “Eurocurrency” has gradually become a most general term, now being used most often to designate bank deposits in any capitalist country (or a loan made available by such a bank) in the currency of some other country.  [82•1 

p Even a specialist now and again finds it hard to sort out all the contortions of international banking operations, which are reflected in the "credit gibberish of the money market", as Marx put it. Let us try to identify some of the most essential links of this intricate mechanism. It was said above that the TNBs, the major US banks in the first place, have a far-flung network of branches abroad, and this enables them to pick up a large part of the dollar funds accumulated in the international payments turnover.

p A sizable part of such deposits with US TNB affiliates abroad belongs to credit institutions, which means that the temporarily uncommitted funds, which have become Eurobank deposits, have already passed through the hands of one or more bank intermediaries. In the major financial centres they are used for intensive interbank transactions, and statistical estimates suggest that this kind of internal turnover of funds within the arteries of the banking system involves truly astronomical figures—trillions (thousands of billions) of dollars. From the major financial centres, the TNBs remit the Eurodollar funds obtained to their branches abroad which are more closely connected with the national money markets, and at this stage in the redistribution of loan capital banking groups and private credit institutions in need of short-term borrowings and resorting to the services of the most powerful TNBs also have a substantial role to play. At the end of the 1970s, roughly threequarters of all the credits issued to US bank branches in Switzerland, France or Holland consisted of inter-bank credits. The result is a chain of credit ties whose middle links consist of “wholesale” operations by the TNBs and their affiliates abroad.

p Vast amounts of money can now be moved from one country to another much more rapidly with the intensive development of 83 transnational banking enterprise and the close interlacing of credit and foreign-exchange operations. The forms in which the economic development of capitalism has proceeded since the war have been markedly influenced by the accumulation of great masses of extremely mobile loan capital in the reservoirs of the international banking system.

p A large part of these bank funds went to finance international trade, which expanded very much faster than the growth of production in the capitalist world. Roughly two-thirds of world capitalist trade in the 1970s was financed with loans on the Eurocurrency markets.

p The bulk of Eurocurrency loans granted by final creditors was short-term, which is why the Eurocurrency market has always been the chief source on which private business drew for most urgently needed funds for settlements. But one should also note the TNBs’ active role in the transformation of short-term money accumulations into medium-term and even long-term loans. The concentration of a large number of short-term deposits enables the transnational financial institutions to identify the stable “settled” amounts and to move them along the channels of medium-term credit. Credit institutions specialising in the extension of foreign-exchange medium-term (up to 5-7 years) credits were first set up by international banking groups relatively a short time ago.

p The web of foreign-based branches of the TNBs and Eurodollar banking groups assured them of the "financial infrastructure" for advancing the internationalisation of capitalist production. The major credit institutions now have on offer to transnational industrial giants an exceptionally wide spectrum of new credit and foreign-exchange services, including, say, the conduct of an intricate system of intra-corporate clearing relations between TNC branches and affiliates scattered across the capitalist world, thereby revealing a tendency towards the gradual conversion of the leading transnational financial intermediaries into centres of public accounting not only on a national, but now also on an international scale. With their numerous instruments of economic influence, the major TNBs command ever more active participation in decision-making in other firms, above all those holding key positions in industry and construction.

p With the domination of capitalist property in the means of production, these processes inevitably lead to a further growth of economic and political conflicts. Thus, the economic rapprochement of the capitalist states brought about by the intensive international migration of money capitals nowadays means a more active "export of inflation" than ever before, and also an extremely rapid spread of crisis upheavals from one set of capitalist countries to another. Meanwhile, speculative operations on international Eurocurrency markets have reached gigantic proportions, with the major TNBs ever more actively involved, the result being a further growth of the instability of the credit system (one need merely recall the largest postwar crash of Franklin, the US banking giant, which speculated itself into bankruptcy).

p As the complex of diverse economic ties between the TNBs and the industrial TNCs is shaped, the financial-oligarchy groups of the leading capitalist countries are ever more tightly interlaced with an expansion of the sphere dominated by finance capital within the framework of the whole world capitalist system. The TNBs’ strong ties with the TNCs, their key role in the international credit and payments mechanism, the concentration of capital and the "wholesale scale" of their credit operations all go to turn the major banks into almighty monopolists of credit whose economic power extends well beyond their home countries.

p The growth of the TNCs and the TNBs over the past decades has vastly expanded the leading financial empires, that is, groups of companies more or less rigidly controlled from a single centre. In the United States, the aggregate assets of eight leading financial groups were estimated in 1985 at $1,400 billion, which makes up more than 20 per cent of the assets of all the industrial and financial companies in the country. These empires are led by old groups which have for their centres the giant New York Bank of J.P. Morgan and Co. Inc. (the Morgan group) and the Chase Manhattan Bank (the Rockefeller group), each with assets valued at over $400 billion. Regional groups (California, Chicago, etc.) have also been growing rapidly.  [84•1 

p As the empires sprawl, the personal fortunes of the families and clans of the financial oligarchy multiply. Facts about them are publicised rarely and unwillingly, but fairly reliable estimates will be found in US writings. Thus, the fortune of the two Hunt brothers, who first got rich on oil, is estimated at $600-1,200 million, and the estimate for the whole clan comes to $6 billion. David and Lawrence Rockefeller have a fortune of $400-600 million, and the 83-member clan has an estimated fortune of $3.5-5 billion. The short-listed Mellon family has a fortune of $900-1,600 million, and the whole family—close to $5 billion. The Duponts, the chemical tycoon family, is estimated to have more than $1.3 billion, and the Ford car-making magnates—up to $1 billion. They are followed by the Hearst, Rosenwald and other families who have “only” $300- 600 million each.  [84•2 

Compare these monstrous fortunes with the plight of tens of millions of working people who can barely make ends meet (to say nothing of the jobless and the homeless), and you will see just how fair the economic and social system of the leading capitalist country is.