Follow the Money

Brad Setser tracks cross-border flows, with a bit of macroeconomics thrown in.

Latest Post

What a Difference a Week (or a Weekend) Makes

Until this past week, it looked like the United States and China were heading toward a deal. Not a great deal, but a deal. China would roll back its tariffs on U.S. agricultural goods and oil (and, as importantly drop the guidance to state import giants to avoid U.S. goods); the U.S. would rollback (sooner or later) the 10 percent tariffs on $200 billion. There would be modest progress on a host of long-standing irritants. Read More

May 7, 2019

Turkey’s Stretched Public Banks… Turkey’s Stretched Public Banks…

Watch the banking system's acces to lira funding as Turks shift toward foreign currency deposits...

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May 2, 2019

China Never Stopped Managing its Trade

So long as the bulk of China's imports from the United States (and many others) are bought by state firms, China has the ability to manage its trade. The management isn't new. What's new is Trump's implicit willingness to accept managed trade so long as the trade is managed in a way that is judged to help the United States.

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April 4, 2019

China's Coming Current Account Deficit? China's Coming Current Account Deficit?

Any economy that saves 45 percent of GDP will tend to run a current account surplus, China included. Keeping its current account surplus down takes extraordinary (though largely off-budget) fiscal effort. And faster financial account liberalization almost certainly would result in a depreciation and push China back toward surplus.

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