Global Imbalances - Recent Developments and Prospects (Bernanke 2007)

United states 1559 1127 3437 2523 2042 developing 828

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United States 155.9 112.7 343.7 252.3 204.2 Developing -82.8 124.7 296.5 507.9 643.2 Asia -40.2 77.0 172.4 245.1 352.1 China 7.2 20.5 68.7 160.8 249.9 Hong Kong -4.0 7.0 15.7 20.3 20.6 Korea -23.1 12.3 28.2 15.0 6.1
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Taiwan 10.9 8.9 18.5 16.0 24.7 Thailand -14.4 9.3 2.8 -7.9 3.2 Latin America -39.1 -48.1 20.4 34.6 48.7 Argentina -6.8 -9.0 3.2 3.5 5.2 Brazil -23.5 -24.2 11.7 14.2 13.6 Mexico -2.5 -18.7 -6.7 -4.9 -1.5 Middle East 15.1 72.1 99.2 189.0 212.4 Africa -5.2 7.2 0.6 14.6 19.9 Eastern Europe -18.5 -31.8 -58.6 -63.2 -88.9 Former Soviet Union 5.2 48.3 62.6 87.7 99.0 Memo: Developing Asia excl. China -47.4 56.5 103.7 84.3 102.2 Statistical discrepancy -51.6 -180.0 0.0 5.4 35.9 1. Calculated as the sum of the balances of the thirteen euro-area countries. Return to table Source: For the United States, Department of Commerce, Bureau of Economic Analysis. For some countries other than the United States, national sources; for most countries, however, International Monetary Fund (IMF), World Economic Outlook Database , April 2007 ( external/pubs/ft/weo/2007/01/data/index.aspx); some values for 2006 are IMF estimates. References Bernanke, Ben S. (2005). " The Global Saving Glut and the U.S. Current Account Deficit ," speech delivered for the Sandridge Lecture at the Virginia Association of Economists, Richmond, March 10, . Similar remarks with updated data were presented for the Homer Jones Lecture , St. Louis, April 14, 2005, .
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------------ (2006). " Reflections on the Yield Curve and Monetary Policy ," speech delivered at the Economic Club of New York, New York, March 20, . Caballero, Ricardo J., Emmanuel Farhi, and Pierre-Olivier Gourinchas (2006). " An Equilibrium Model of 'Global Imbalances' and Low Interest Rates ," NBER Working Paper Series 11996. Cambridge, Mass.: National Bureau of Economic Research, January, . Mendoza, Enrique G., Vincenzo Quadrini, and Jose-Victor Rios-Rull (2007). " Financial Integration, Financial Deepness, and Global Imbalances ," NBER Working Paper Series 12909. Cambridge, Mass.: National Bureau of Economic Research, February, . Footnotes 1. The shift was almost wholly attributable to a similar expansion of the trade deficit. The balance on investment income actually improved over the period. Return to text 2. More precisely, investment grew from 19.0 percent to 19.3 percent of GDP, and saving declined from 16.5 percent to 13.8 percent of GDP, for a net change in investment less saving of 3.0 percent of GDP. As implied by data noted earlier in this paragraph, the net change in the U.S. current account deficit over the same period was 3.9 percent of GDP. In principle, the change in the excess of investment over saving and the change in the current account deficit should be the same. The difference between the two figures is accounted for by statistical discrepancies, both within the national income and product accounts (NIPA) and between the balance of payments definitions and NIPA definitions of certain international transactions. Return to text 3. I am using the terms "emerging-market" and "developing" interchangeably. Return to text 4. As shown in the table, the surplus of industrial countries other than the United States increased
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