In 1998, the Russian government defaulted on its debt payments, leading investors worldwide to raise their preference

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In 1998, the Russian government defaulted on its debt payments, leading investors worldwide to raise their preference for U.S. government bonds, which are considered very safe. What effect do you think this “flight to safety” had on the U.S. economy? Be sure to note the impact on national saving, domestic investment, net capital outflow, the interest rate, the exchange rate, and the trade balance.

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