The external equilibrium of the United States, a key feature of the international monetary system

The external equilibrium of the United States is the equilibrium between: The US current account balance (structurally in deficit); Capital inflows to the United States (the nature of US gross external debt); Capital outflows from the United States (the nature of US gross external assets). Traditionally, the US was “the world’s banker": it provided the rest of the world with a risk-free asset (US public debt), and invested in the rest of the world in corporate capital (equities, direct investments). First, we seek to determine what has become of the US role as the "world’s banker". We see: That it still holds for US external assets (consisting of equities, direct investments, etc.); But that it no longer holds for external debt (which includes all asset classes, but not only debt). We then seek to determine how the United States finances its structural external deficit, and whether there is a threat that the deficit will be difficult to finance. This threat is twofold: A loss of fiscal solvency for the United States; A decline in the attractiveness of US companies.