Transcripts of the monetary policymaking body of the Federal Reserve from 2002–2008.

I certainly don’t dispute that it is useful to know things like the amount of private versus official financing, and the nature of some of the flows, and so forth. But let me caution you that, in the end, the actual data recorded for capital flows will conform to the current account balances. There are certain market equilibria that imply certain identities. So the fact that the numbers are what they are isn’t so important. What matters are the terms on which those flows occur. So things like exchange rates, interest rates, and equity prices will tell you the characteristics of the returns to assets that had to be realized in order to get the flows to be what the flows had to be.

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