Persistently large external imbalances in the world economy contributed to the outbreak of the recent financial crisis. The current account imbalances were particularly severe among the economies that border on the Pacific. The depth and breadth of the global recession also demonstrated the need for a coordination of national policies to achieve a sustained recovery. While the magnitude of global-trade disruption led to some reduction in the size of the imbalances, closer examination suggests that the progress may prove temporary. On the other hand, significant changes in the underlying patterns of saving and investment suggest that some of the recent rebalancing may prove to be more permanent. Are such imbalances really a problem? If so, why and for whom? And what should be done about them?