As the IMF finally comes around to realize that unfettered capital flows may not be optimal policy for all countries at all times, not all countries agree that the new IMF stance is appropriate. 

At the same time, China is moving in to the opposite direction – well somewhat. The Chinese capital account has been one of the most tightly regulated, which is about to change – slightly, as the WSJ reports. This is a good exercise to see how policy effectiveness in China are going to change in the Mundell Fleming model with fixed exchange rates!