1. A large part of the widening current account deficit is still financed by short-term capital inflows.

2. There is a separate question of whether free flows of long-term capital can be encouraged while discouraging some short-term capital movements.

3. So, while post-crisis Asia focused in the 2000’s on repairing the financial vulnerabilities that had wreaked such havoc – namely, by amassing huge foreign-exchange reserves, turning current-account deficits into surpluses, and reducing its outsize exposure to short-term capital inflows – it failed to rebalance its economy’s macro structure.