Unstable regimes often have capital flight. The citizens with cash decide that it is no longer a wise idea to keep their money in the country, so out it goes. (One of the reasons that there are so many Cuban-Americans in Miami, for example, is because that is where a lot of the money went when Castro came to power. Either people followed their money out of the country, or the money came with them.)
The political and economic stability of the U.S. has been a great advantage. We have been the beneficiary of capital flight from all sorts of regimes around the world. In New York, Chicago, Washington D.C., and Los Angeles you can literally find neighborhoods or authentic restaurants with emigres from every corner of the globe. Since the citizens with money are often also the best educated, the U.S. has also been the beneficiary of “brain drain” from numerous countries, especially those with repressive policies or few economic opportunities.
In recent months, however, the U.S. has seen capital drain out of the economy. It’s not entirely clear why this is happening and not all of the possible explanations are negative. Still, with the recent weakness of the dollar, it’s something to keep an eye on.
