Recycling Global Imbalances Korkut Ertürk

Is the United States at long last getting serious about global imbalances, or are we risking currency wars that can end in unmitigated disaster for all? No one knows, though tension is on the rise with China. This much is certain: any advantage from a lower currency is a zero-sum gain for the world economy as a whole. At best, it is about how to distribute the pie, not about growing it. Until recently, many economists were not sure if global imbalances were something to be worried about at all. If markets always worked efficiently as most economists had accepted…