"Were the U.S. to persistently earn substantially more on its foreign investments ("U.S. claims") than foreigners earn on their U.S. investments ("U.S. liabilities"), the likelihood that the current environment of sizeable global imbalances will evolve in a benign manner increases. However,...

We develop a novel measure of investor sentiment based on the valence of songs that individuals listen to. We show that our measure of music sentiment captures seasonal mood swings. We further document that music sentiment is associated with a systematic pattern of mispricing correction. This...