The dominant view in the market appears to be that it is not a question of if, but rather when and how the adjustment will take place. As I noted earlier, the IMF view is that although there is a risk of a disorderly adjustment, a smooth market-led adjustment is the most likely outcome.
By contrast, in the 2005 annual report of the Bank for International Settlements it was noted that the unwinding of the imbalances could be uncomfortable, either through profound market turbulence or a protracted period of slow world growth. A number of solutions to the problem of global imbalances have been proposed.