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If you look at data on the website of the Bureau of Economic Analysis, you will see that between the end of 2003 and the end of 2007, the net foreign debt of the United States rose by far less than the sum of its current account de?cits over those years. At the same time, the dollar depreciated. What is the connection? (Hint: The United States borrows mostly in dollars but has substantial foreign currency assets.)

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