this post was submitted on 22 Mar 2024
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You can't sneak negative trade balance into an argument about public debt.
A nation with no debt has the ability to take on more debt than if it already has debt.
You can have debt for circulation while maintaining a net surplus in all accounts. For example Norway has a per capita debt of $42k USD while maintaining a surplus of $295k USD per capita.
It's similar to how a company like Apple holds debt of $108 B USD while maintaining a $162 B USD surplus.
Which is why the trade balance is crucial when talking about financial assets. Because then all of these are financiall assets in foreign countries.