Chapter 1: Understanding the U.S. current account deficit
In assessing the U.S. current account, MGI analyzes its components, what has caused the deficit to reach its current size, patterns of foreign investment in the United States, and the different ways the U.S. deficit is financed.
Chapter 2: Could the world fund a larger U.S. current account deficit?
This chapter explores the following questions: Could the U.S. current account deficit continue to grow even larger over the next five years? If current trends persisted, how large would it become? Would there be enough global capital to fund a larger U.S. deficit? Would the implied U.S. net foreign-debt position be sustainable?
Chapter 4: Potential dollar depreciation and impact on trade patterns
While it is possible that the U.S. current account deficit could continue to grow over the next five years, the United States cannot continue to build up foreign liabilities forever. This chapter considers three different scenarios under which a depreciation of this magnitude could occur.
Chapter 5: Opportunities and challenges for business and policy makers
This chapter examines what a larger deficit, followed by a very significant potential currency adjustment, would mean to business leaders and policy makers and how they should prepare for this possibility.
A new look at the U.S. current account deficit: The role of multinational companies America's growing current account deficit has set off alarm bells among many economists and policy makers. But today's debate misses its mark by ignoring the trade between multinational companies, their foreign affiliates, and consumers. What is needed is a global, rather than national, view on the deficit and policies to ensure the best global economic outcomes. Read more
