Is the United States still gaining from being “the world’s banker”?

The United States has traditionally played the role of the world’s banker: it sells risk-free assets (US Treasuries) to the rest of the world - beyond what is necessary to finance its external deficit - and reinvests in corporate capital (equities and direct investments) in the rest of the world. This is clearly what a bank does, using risk-free liabilities to finance risky asset s . It also makes the United States richer, since the cost of its external debt (gross, risk-free debt) is lower than the return on its external assets (gross, risky capital). In the recent period, the United States has stopped playing the role of the world’s banker: the rest of the world has no longer been buying Treasuries; the United States has no longer been buying equities or making direct investments in the rest of the world. This major change , linked to the decline in global foreign exchange reserves, makes the United States poorer.