Working Papers in full text
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
All
Other research-related activities and publications of the IMF can be found at IMF Research
|
Free Email Notification
Receive emails when we post new
items of interest to you.
Subscribe or
Modify your profile
|
|
|
|
How Might a Disorderly Resolution of Global Imbalances Affect Global Wealth?
|
Author/Editor: |
Warnock, Francis E. |
| Authorized for Distribution: |
July 1, 2006 |
|
Electronic Access: |
Free Full Text (PDF file size is 528KB)
Use the free Adobe Acrobat Reader to view this PDF file.
|
|
|
|
Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate.
|
|
Summary: Partly reflecting structural advantages such a liquidity and strong investor protection, foreigners have built up extremely large positions in U.S. (as well as other dollar-denominated) financial assets. This paper describes the impact on global wealth of an unanticipated shock to U.S. financial markets. For every 10 percent decline in the dollar, U.S. equity markets, and U.S. bond markets, total wealth losses to foreigners could amount to about 5 percentage points of foreign GDP. Four stylized facts emerge: (i) foreign countries, particularly emerging markets, are more exposed to U.S. bonds than U.S. equities; (ii) U.S. exposure has increased for most countries; (iii) on average, U.S. asset holdings of developed countries and emerging markets (scaled by GDP) are very similar; and (iv) based on their reserve positions, wealth losses of emerging market governments could, on average, amount to about 2¾ percentage points of their GDP.
|
|
|
|
Order a print copy
|
|
Series: |
Working Paper No. 06/170 |
|
Subject(s): |
Capital markets | United States |
|
Author's keyword(s): |
U.S. asset holdings
| global asset portfolios
| disorderly currency adjustments
| global current account imbalances
|
|
|
|
|
| |
Published: |
|
July 1, 2006 |
|
|
|
|
| |
ISBN/ISSN: |
|
0 / 1934-7073 |
|
Format: |
|
Paper |
| |
Stock No: |
|
WPIEA2006170 |
|
Pages: |
|
28 |
| |
Price: |
|
US$15.00 (Academic Rate: US$15.00 )
|
|
|
|
|
|
|
