TY - BOOK ID - 84542501 TI - Real Interest Rates, Real Exchange Rates, and Net Foreign Assets in the Adjustment Process AU - Helbling, Thomas. AU - Turtelboom, Bart. PY - 1995 SN - 1462341837 1455222291 PB - Washington, D.C. : International Monetary Fund, DB - UniCat KW - Banks and Banking KW - Consumption KW - Currency KW - Economics KW - Exports and Imports KW - External position KW - Finance KW - Financial services KW - Foreign assets KW - Foreign currency exposure KW - Foreign exchange market KW - Foreign Exchange KW - Foreign exchange KW - Government and the Monetary System KW - Interest rates KW - Interest Rates: Determination, Term Structure, and Effects KW - International economics KW - International Investment KW - Investments, Foreign KW - Long-term Capital Movements KW - Macroeconomic Aspects of International Trade and Finance: Forecasting and Simulation KW - Macroeconomics KW - Macroeconomics: Consumption KW - Monetary economics KW - Monetary Systems KW - Money and Monetary Policy KW - Money KW - National accounts KW - Open Economy Macroeconomics KW - Payment Systems KW - Real exchange rates KW - Real interest rates KW - Regimes KW - Saving KW - Standards KW - Wealth KW - United States UR - https://www.unicat.be/uniCat?func=search&query=sysid:84542501 AB - This paper analyzes the recent behavior of real exchange rates, the trade balance and the net foreign asset position of the United States in an intertemporal optimizing model of the world economy that incorporates heterogeneity across countries and imperfect international capital and good markets. While the model successfully tracks the dynamics of trade balances and net foreign assets it generates too much consumption smoothing and excessively volatile relative prices. Resolving these inadequacies simultaneously is difficult as the elasticity of substitution between tradables and nontradables affects in opposite ways the degree of consumption smoothing and the volatility of relative prices. ER -