Essay on The Current Account Balance Of The United States

Essay on The Current Account Balance Of The United States

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In the past decade, the United States has invested enormous amounts of money internationally. The amount of money the United States has invested internationally would be in the trillion dollar range. Based on the charts from OECD, the estimated total international invest in the past ten years is roughly $1.657 trillion. The United States makes its largest investments in the Netherlands, Canada, and the Belgium-Luxembourg Economic Union (BLEU). The United States makes is smallest investments in Estonia, Iceland, and Slovenia.
The United States balance of payments fluctuates up and down. Payments are affected by the current account balance. “Current account balance is the sum of net exports of goods and services, net primary income, and net secondary income” (worldbank). The international investment varies between every country the United States finances in, thus altering the balance of payments. The United States inflow is used to finance international investments. Inflow needs to be higher than outflow so there will not be an account deficit. Financing is determined by the functionality of accounts, economy, currency type, and interest rates. Economies that are flourishing are more likely to make quicker and stable payments. TIC flows and returns are somewhat even according to statistical data. This evenness is created from investments in riskier short-term assets rather than long-term and safe assets. The United States international investments are still occurring regularly, but more investments are happening within the country.
The Matthews Japan Fund (MJFOX) was established on December 31st, 1998. MJFOX was created by the privately owned firm; Matthews. Matthews originated in 1991 and is located in San Francisco, California....


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...ts in various markets within Japan. MJFOX’s largest investment is with Toyota Motor Corp., which totals 4.5% of its assets. MJFOX invests in industrials, financials, consumer discretionary, health care, consumer staples, information technology, telecom services, and materials. The current share price for MJFOX is $16.77 with a 3.52% YTD return.
I believe the Matthews Japan Fund (MJFOX) would be a sound investment for those looking for long-term profitable shares. An investment in MJFOX will have positive and negative return years like any other stock share. The upside to MJFOX is that it has been profitable in its 15 year span. If I could afford to invest long-term into MJFOX, I would invest 25% of my portfolio into the fund. I would only finance 25% into MJFOX because it only invests in Japan’s market. If Japan’s economy falters, then so will Matthews Japan Fund.

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