Purpose
Capital movements offset the surpluses or deficits in the current account. A current account surplus, for example, implies that rather than using all the foreign currency earned by selling exports to buy imports, corporations and individuals choose to invest the money in foreign-currency-denominated assets instead. As measured in Japan's balance of payments data, capital movements consist of long- and short-term investments and movements in official foreign exchange reserves and private bank accounts. Capital movements include loans, portfolio investments in corporate stock, and direct investment (establishment or purchase of subsidiaries abroad). A capital outflow occurs when a Japanese individual or corporation makes a loan, buys foreign stock, or establishes a subsidiary abroad. A capital inflow occurs when foreigners engage in these operations in Japan.
Read more about this topic: Capital Flows In Japan
Famous quotes containing the word purpose:
“When one pays a visit it is for the purpose of wasting other people’s time, not one’s own.”
—Oscar Wilde (1854–1900)
“During the cattle drives, Texas cowboy music came into national significance. Its practical purpose is well known—it was used primarily to keep the herds quiet at night, for often a ballad sung loudly and continuously enough might prevent a stampede. However, the cowboy also sang because he liked to sing.... In this music of the range and trail is “the grayness of the prairies, the mournful minor note of a Texas norther, and a rhythm that fits the gait of the cowboy’s pony.””
—Administration in the State of Texa, U.S. public relief program (1935-1943)
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—Frances Ellen Watkins Harper (1825–1911)