that's an oversimplification and incorrect
Posted on: April 7, 2025 at 16:31:21 CT
Seagull MU
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The US government does not directly borrow money to finance the trade deficit. Instead, the trade deficit is financed by foreign investors who buy US Treasury securities, such as bonds and notes.
These foreign investors are willing to buy US Treasury securities to earn a return on their investment and to hold a safe-haven asset. The US government issues these securities to finance its budget deficit