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The Dynamics of Asset Ownership

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  • Kennedy, Thomas

Abstract

As nations trade, invest and sell debt, the ownership of assets like currencies, financial assets and real estate start accumulating in certain countries. Those with positive current accounts create new markets with their foreign currencies. Those with deficits finance their consumption by creating debt instruments, affecting the global bond market. Simflows is a computer model that forecasts the ownership of currencies and debt. It uses national spending and production characteristics to predict new owners of assets. Each year currency accumulations are predicted as well as debt holdings and ownerships of tangible properties. This paper presents graphs showing the dispersion of each country's wealth to other nations and the ownership of foreign assets. Running the program reveals possible crisis points such as global shortages and defaults.

Suggested Citation

  • Kennedy, Thomas, 2018. "The Dynamics of Asset Ownership," Conference papers 333015, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:333015
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    File URL: https://ageconsearch.umn.edu/record/333015/files/9052.pdf
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    References listed on IDEAS

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    1. Ben S. Bernanke, 2015. "The Federal Reserve and the Financial Crisis," Economics Books, Princeton University Press, edition 1, number 9928-2, December.
    2. repec:ucp:bkecon:9780226081946 is not listed on IDEAS
    3. Carmen M. Reinhart & Kenneth S. Rogoff, 2009. "Varieties of Crises and Their Dates," Introductory Chapters, in: This Time Is Different: Eight Centuries of Financial Folly, Princeton University Press.
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