From World Banker to World Venture Capitalist
U.S. External Adjustment and the Exorbitant Privilege
This chapter investigates the historical evolution of U.S. external assets and liabilities at market value since 1952. It shows strong evidence of a sizeable excess return of gross assets over gross liabilities. It also demonstrates that the United States tends to borrow short and lend long. It supports the notion that the United States enjoyed a significant premium on its gross assets relative to its liabilities and that this premium has been increasing since the collapse of the Bretton Woods fixed exchange rate system. The collapse of Bretton Woods has not deprived the United States of its fundamental role as world liquidity provider. It is found that depreciations are associated with significantly larger returns on gross assets and lower returns on gross liabilities. Furthermore, while the United States is still some ways away from making net payments on its mounting stock of net liabilities, that moment is approaching.
Chicago Scholarship Online requires a subscription or purchase to access the full text of books within the service. Public users can however freely search the site and view the abstracts and keywords for each book and chapter.
If you think you should have access to this title, please contact your librarian.
To troubleshoot, please check our FAQs, and if you can't find the answer there, please contact us.