Durable capital flows bring durable growth, while non-durable and volatile capital flows not only bring about non-durable growth but also large output losses in cases of currency or banking crisis. This however does not make a case for capital controls as in a globalised world capital account liberalisation is seen as a plus-sum game.
In 1987 shortly after he took over as Chairman of the Federal Reserve, he said, “Since I’ve become a central banker I’ve learned to mumble with great incoherence.