Can you tell me why people are so focused on the current account deficit figure? If the underlying worry is the potential destabilising effects of hot money and short term borrowing then why doesnt' everyone simply focus on metrics that track those figures? Is it because CAD is a more readily available/computable figure or is it because of some other reasons drive why CAD is so important to focus on? Any comments/insight you got on this would be highly appreciated.
Friday, January 14, 2011
I got a couple of very interesting reader questions, so I decided to do another reader appreciation day, or rather weekend, where I will be addressing those questions.
For some scoop, the first question is on my expectations on commodity prices and whether it is real or inflated (like my ego). As for the second question, it better that I quote directly from the reader:
I will be addressing both of these questions over the course of the weekend.