-->Hi,

hier ein Artikel aus dem Global Economic Forum von Morgan Stanley. Aus dem zuletzt veröffentlichten Flow of Funds Bericht werden die Kapitalinvestitionen in den USA besprochen.

<font size="5">US Capital Inflows -- Robust by Default </font>

Joe Quinlan, Karin Kimbrough & Rebecca McCaughrin (NY)

The investment climate outside the United States has to be quite unappealing -- how else to explain the seemingly insatiable appetite for US assets among foreign investors. Undeterred by America's war on terrorism, impervious to numerous accounting scandals, dispassionate about the impending war with Iraq, and heedless to the threat of soft US earnings and weak economic growth, foreign investors still view US assets as some of the best investments in the world.

In July alone, the most recent month of available data, foreign investors ploughed $2.3 billion into US securities each working day, or just over $50 billion for the month. Through the first seven months of this year, US portfolio inflows totaled $280.4 billion, down some 11% from the same period a year ago, but enough to cover the US current-account deficit. Indeed, net aggregate portfolio inflows (the aggregation of US portfolio inflows and outflows) tallied $308 billion in the first seven months of this year, a net capital infusion roughly 10% larger than the US current account deficit ($282 billion) in the same period.

Due to large inflows as well as large net selling of foreign securities by US investors (roughly $20 billion in July along), net aggregate portfolio inflows totaled $71 billion in July, the second-highest total on record. Keep in mind that foreign investors are not the only ones exporting cash to the US -- so too are US investors as they bail out of foreign markets.

Bifurcated Flows Again in July

Our central theme of bifurcated inflows was all too evident again in July, with Euroland investors as net sellers of US securities, while Asian investors were net buyers. Strong inflows also emanated from the United Kingdom and other offshore money centers.

Investors in Euroland were net sellers of $1.3 billion in US assets in July, following net selling of $2 billion in June and $7.9 billion in May. In the year to date, Euroland investors were net sellers to the tune of $3.9 billion versus net buying of $43.4 billion in the same period of 2001. That's a large swing in Euroland flows, but more than offset by the rising tide of capital from Japan and Asia ex-Japan.

Owing to low returns and mounting frustration with the pace of reform in Japan, Japanese investors have been particularly aggressive in snapping up US securities this year. In fact, through the first seven months of this year, US net inflows from Japan totaled $40 billion, double the level of the same period a year ago. In July, Japanese inflows totaled nearly $17 billion, or one-third of the monthly total. Purchases were directed primarily at US Treasuries and corporate bonds. Another 25% of total inflows in July ($13 billion) were courtesy of investors in Asia ex-Japan, with Chinese investors representing the largest share of purchases.

On balance, the appetite of Euroland investors for US assets has diminished this year, a development attributable to such factors as more-attractive equity valuations in Europe, a general distrust in corporate governance in the US, and a loss of confidence in the US economy. Asian investors view the US through a different lens. With various Asian stock markets leveraged to the US economy, many investors in the region prefer to invest directly in the US rather than at home. In addition, US assets (US Treasuries) are viewed as the ultimate safe haven for investors alarmed by the geopolitical threats of rising oil prices and the increasing threat of war in the Middle East.
Central bank intervention, notably in Japan and South Korea, has also given a boost to demand for US assets this year as central banks in the region fight to hold the line on stronger local currencies through net purchases of dollar-denominated assets lest export growth stall.

Interestingly, should the West Coast longshoremen's strike seriously disrupt transpacific trade flows, dampening Asia's export growth in the process, even more-aggressive attempts at weakening local currencies (a.k.a. buying US assets) could become more apparent over the fourth quarter as Asian policy makers re-stoke their export engines.

Foreign Holdings of US Securities

Given strong inflows over the balance of this year, foreign holdings of various US assets remained at or near record highs in the second quarter of this year. For instance, according to the latest flow of funds data from the Federal Reserve, foreign holdings of US Treasuries totaled $1 trillion at the end of the second quarter, up from $985 billion in 2Q 2001. At current levels, foreign investors owned 30.8% of outstanding marketable Treasury securities, off slightly from the record 31.8% share of 1998.

Foreign holdings of US agency securities or the debt of government-sponsored enterprises like Fannie Mae and Freddie Mac also stood at record levels in the second quarter of this year. Then, foreign investors held $604 billion of agency issues, up from $498 billion in the same period a year ago, and more than double the outstanding level of 1999. Given the increased popularity of government agencies among investors, foreigners were holding a record 11.5% of outstanding agency securities in the second quarter. That compares with a share of 7.7% in 1999.

Corporate bonds have been another favored asset class of foreign investors over the past few years, with foreign holdings nearly doubling between 1998 ($608 billion) and the second quarter of this year ($1.2 trillion). In the process, the share of outstanding US corporate bonds held by foreign investors rose from 16.4% in 1998 to a record 22.3% in 2Q. Similar trends are evident regarding US equities, with foreign investors holding 12% of the value of outstanding corporate stocks in 2Q, up from a share of 11.6% in 1Q and 11.2% in 2001.

All of the above highlights just how much influence foreign investors exert in the US financial markets and underscores the risk America confronts if foreign investors do decide, for whatever reason, to pare their holdings of US securities sometime in the future.

Bottom Line: US Benefiting from the Misfortune of Others

Call it a most unusual yet propitious twist of fate: over the second half of the 1990s, the US was a magnet for global capital on account of its superior economic performance relative to the rest of the world. America's wherewithal to attract capital, in other words, was legitimate and logical -- the US was the world's sole military and economic superpower, a status bound to attract capital from all over the globe.

Today, the US remains a singular superpower. However, robust US capital inflows over the past two years have been less about merit and more about extremely poor investment opportunities or returns in other parts of the world. Put another way, America's good fortune in attracting inflows reflects, in part, the ill fortunes of others -- think of a stagnant Europe, floundering Japan, export-dependent non-Japan Asia, imploding South America. America draws from the world's saving pool more out of default than merit. But benefiting from the misfortunes others is a precarious way to live and is unsustainable, in our view. Yet that is precisely where the US stands at this juncture in terms of funding its current-account deficit.

Gruss
Cosa