CRS report discusses status of US as net debtor nation

The United States as a Net Debtor Nation: Overview of the International Investment Position
October 18, 2007

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Summary:Theinternational investment position of the United States is an annualmeasure of the assets Americans own abroad and the assets foreignersown in the United States. The net position, or the difference betweenthe two, sometimes is referred to as a measure of U.S. internationalindebtedness. Although this designation is not strictly correct, thenet international investment position does reveal the differencebetween the total assets Americans own abroad and total amount ofassets foreigners own in the United States. These assets generate flowsof capital into and out of the economy that have important implicationsfor the value of the dollar in international exchange markets. SomeMembers of Congress and some in the public have expressed concernsabout the U.S. net international investment position because of therole foreign investors are playing in U.S. capital markets and thepotential for large outflows of income and services payments. Someobservers also argue that the U.S. reliance on foreign capital inflowsleaves the economy vulnerable to financial crises. This report will beupdated as events warrant.