In this paper, we present a model of the current account. The model has two variants, one in which assets are perfectly substitutable in investors' portfolios, and another in which they are not. We examine the responses of these two variants of the model to standard shocks, and show that under imperfect substitutability, a valuation effect comes into play. We focus on the external accounts, and examine the role and strength of these valuation effects. Additionally, the imperfect substitutability case allows us to examine the model's response to an exogenous change in investors's portfolio preferences. The model in this paper provides a framework for understanding the experience of the dollar's real value and of the US current account over the last decade. . We wish to thank Olivier Blanchard, Roberto Rigobon, and Francesco Giavazzi, for many useful discussions. We are also grateful to seminar participants at Smith College and Swarthmore College for comments and suggestions.

This essay introduces the reader to an entirely new set of measures that are urgently needed by policymakers and business leaders to foster personal, business, and national economic success. Social Wealth Economic Indicators are measures suggested by a partnership model of society, and they inform us that care work matters tremendously but is grossly undervalued. In our contemporary knowledgeservice economy, the essential ingredient for social and economic progress is high-quality human capital, and the way to build such human capital is to support the work of caring and caregiving, traditionally considered "women's work." The data presented in this essay clearly show that early childhood care and education, family-friendly workplace practices, and the status of women are key determinants of economic success. But they are also necessary for healthy, creative, and cohesive societies in which members work in partnership with each other and with the natural environment to improve living conditions for all. This is the true meaning of social wealth.

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This article introduces the reader to a new framework for conceptualizing and measuring economic activity called caring economics. Going beyond the conventional understanding of economic activity as that which unfolds in markets, caring economics highlights the work of care and caregiving that occurs within households and is often unpaid. This article also unveils a new set of measures based on the framework of caring economics that are urgently needed by policymakers and business leaders to foster personal, business, and national economic success.

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