Capital flight

This fall is particularly damaging when the capital belongs to the people of the affected country because not only are the citizens now burdened by the loss in the economy and devaluation of their currency but their assets have lost much of their nominal value.

[1] A classical view on capital flight is that it is currency speculation that drives significant cross-border movements of private funds, enough to affect financial markets.

[8] In 1995, the International Monetary Fund (IMF) estimated that capital flight amounted to roughly half of the outstanding foreign debt of the most heavily indebted countries of the world.

The 1998–2002 Argentine great depression of 2001 was in part the result of massive capital flight, induced by fears that Argentina would default on its external debt (the situation was made worse by the fact that Argentina had an artificially low fixed exchange rate and was dependent on large levels of reserve currency).

A 2006 article in The Washington Post gave several examples of private capital leaving France in response to the country's wealth tax.

"[9] A 2009 article in The Times reported that hundreds of wealthy financiers and entrepreneurs had recently fled England, Wales and Scotland in response to recent tax increases, and had relocated in low tax destinations such as Jersey, Guernsey, the Isle of Man, and the British Virgin Islands.