Global imbalances: the perspective of the Banco de México

A. Carstens

Financial Stability Review, 2011, issue 15, 39-42

Abstract: Global imbalances (GIs) have been with us for quite some time. To a large extent, for many years they were disregarded by the world economic powers. Such imbalances provided fertile ground for a major financial crisis to erupt. Regretfully, many of the policy measures implemented as a response to the crisis have exacerbated the damaging potential of GIs. The most recent manifestation of this is the rapid expansion of beggar-thy-neighbour policies that an uncoordinated policy response to GIs is leading to. Under this scenario, G20 policymakers should be alert and devote their efforts to search for possible agreed upon solutions to the underlying disequilibria; otherwise, we could be sowing the seeds for a new, potentially more devastating crisis.

Date: 2011
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