On Wednesday, 12 February, the APHIOG group will hold its first lunch seminar of the semester, with fellow Christian Heyerdahl-Larsen's talk titled "International Capital Markets and Wealth Transfers".

During periods of global financial turmoil, stock markets decline, the US dollar strengthens, and the United States experiences losses on its net foreign asset position. At first glance, this might suggest a transfer of wealth from the US to other countries. However, we challenge this view by showing that US wealth actually increases during these crises. The appreciation of the dollar boosts the value of US-based assets, offsetting external losses. We develop a theoretical framework where wealthier nations exhibit greater tolerance for financial risk, leading to a paradoxical outcome: while the US net foreign asset position worsens in turbulent times, its share of global wealth rises. Our model captures key patterns in asset prices and currency markets, offering new insights into the dynamics of global capital flows and financial stability.