They Owe US

Despite 18 years of near-persistent current-account deficits and an associated negative net international investment position, the U.S. has continued to receive more income on assets held abroad than we have paid out on foreign assets held in the U.S. Our claims on foreigners have a higher average return than foreign claims on the US.

 

The key to understanding this conundrum, is recognizing that U.S. assets abroad have appreciated over the years, and this important fact is often overlooked by commentators.