Current account deficit rose sharply in all of these countries, especially after 2005. The account deficit is the direct consequence of the huge private capital flows into the same period. Along with the adoption of the euro, investors from Germany and other wealthier countries have poured money into the country in the euro zone. When capital flows massively into the private sector, embracing on the tremendous financial obligations. Remember that the private sector's net borrowing by definition is current account deficit except for the balance of the budget. The limit of this process is determined by the reserve, not traffic. When the world was still happy for the country to borrow money (in other words, when they can maintain current account deficit), the Government and the private sector can continue to accumulate debt. When the water is not able to pay the debt, the investors have massively withdrawing money out of the country, more and more difficult for the Government and the private sector the country in repayment.
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