Macroeconomics 11th Edition by Michael Parkin

تمرين 27

Use the following information to work Problem.
Global Saving Glut and U.S. Current Account, remarks by Ben Bernanke (when a governor of the Federal Reserve) on March 10, 2005: The U.S. economy appears to be performing well, but one aspect of U.S. economic performance still evokes concern: the nation's large and growing current account deficit (negative net exports). Most forecasters expect the current account imbalance to decline slowly, implying a continued need for foreign credit and a concomitant decline in the U.S. net foreign asset position.
a. What implications do the U.S. current account deficit (negative net exports) and reliance on foreign credit have for economic performance in the United States?
b. What policies, if any, should be used to address this situation