Instead, most hope that controls on short-term capital flows might make them less volatile.

ECONOMIST: Time to turn off the tap?

They have freed their exchange rates, avoided a dependence on short-term capital flows and steered clear of running up massive current-account deficits.

ECONOMIST: A health check for emerging markets

The reason seems to be that Chileans agree more with Mr Stiglitz: they worry about the turbulent impact of short-term capital flows even in their well managed economy.

ECONOMIST: Can capital controls stop poor countries crashing?

High on the list is the fact that American asset prices have been sustained by short-term flows of portfolio capital, just as in Asia.

ECONOMIST: As bad as it gets?

However, that is not so of the long-term threat to cross-border capital flows: the changes that regulators make to the landscape for multinational banks, especially in Europe.

ECONOMIST: Globalisation under strain: Homeward bound | The

While China keeps tight control on flows of capital in and out of the economy, short-term speculative investments often take place under the radar, and the central bank typically soaks up extra cash by using so-called liquidity operations.

WSJ: Investors Seek Clarity From People's Bank of China

It does nothing to increase productivity but, to the extent that it distorts capital flows and investment decisions, it wastes our time and savings and reduces our long-term productivity.

FORBES: Three Examples (Or Is It One) Of How To Have A Lower Standard Of Living