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"The high level of current account imbalances continues to be a major focus of international concern. In this paper I suggest why public and private actions in the United States and China are now likely to cause the current account imbalances in those countries to shrink and perhaps even to...
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Although natural market forces should resolve such imbalances without the need for specific government policies, the government actions in both countries have actually contributed to their persistence and prevented market forces from correcting the problem. That may be about to change
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Although the link between the U.S. budget deficit and trade deficit in the 1980s was so clear that the two were … budget deficits and trade deficits are two sides of the same coin. An increased budget deficit (or other reduction in …, there might have been less investment and a smaller increase in the trade deficit. The response to a reduction in national …
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