BIS Review 27/2005  contributions. Of course, these results are the product of our model-based analysis, with all of the strengths and weaknesses that model simulations entail; it would be useful to complement these findings with more direct historical and empirical analysis of the U.S. external imbalance.
Attributing the historically unprecedented widening of the trade deficit, as well as the similarly unprecedented rise in our international indebtedness, to the coincidence of many random and unrelated developments would not make for a very satisfying story.