Just the opposite. Foreign capital is flowing here buying our assets. The US trade deficit is being financed by borrowing from abroad. Barkley Rosser -----Original Message----- From: David Welch <welch at cwcom.net> To: lbo-talk at lists.panix.com <lbo-talk at lists.panix.com> Date: Saturday, September 25, 1999 10:10 PM Subject: Re: U.S. foreign debt
>Silly question, but doesn't an increase in US foreign debt imply that US
>capital is flowing abroad, purchasing real assets and hence foreign
>countries accumulate dollar claims? So we can infer that profit rates are
>too low in the US but large enough elsewhere for a successful expansion
>(otherwise why would capital move abroad). Assuming profit rates are
>maintained and the US has the military muscle to keep other countries from
>adopting Malaysian like financial controls, couldn't foreign debt be
>expanded indefinitely?
>
>On Sat, Sep 25, 1999 at 02:45:47PM -0400, Doug Henwood wrote:
>>
>> U.S. military and political power puts a limit on how much we could
>> be foreclosed upon, but still the country could suffer a capital
>> outflow and be powerless to do anything about it except raise
>> interest rates.
>>
>> Russia is a wreck, so I'm not sure just what all those bombs have done
for it.
>>
>> Doug
>>
>
>