Large current account imbalances are an inherent part of strong global growth, but in order to be sustainable, they must be: •  the product of private decisions taken in a context of sound macroeconomic policies and robust market structures; and  •  financed by an open, resilient financial system.
In many respects, the problems we face today are the product of two flawed monetary unions: one formal – the European monetary union; the other informal – Bretton Woods II. In both cases, financial reforms will be integral to the solution. European Monetary Union Europe’s problems today are partly a product of the initial success of the single currency.