The U.S. current account deficit was at a record level in 1999 and is expected to increase further in 2000. How large can this deficit get? Will an eventual adjustment in the deficit place the U.S. economy at risk? This article examines three arguments often put forth to explain the increase in...

This article reviews and interprets the recent currency crises in Korea and Thailand. The authors argue that a prime causes of the crises were large, unfunded government guarantees to railing financial sectors.