President Donald Trump’s trade war has focused a large part of Wall Street’s attention to the US balance sheet deficit or the imbalance between imports and exports. But there is another metric that is worth worsening the financial risks.
According to Kevin Ford, FX and Macro strategist at Convera, the NET International Investment position of the country (NIIP) is often overlooked.
It measures how much the United States owns abroad and how much the world has in the USA, he said in a note last week and described it as a financial scorecard America with the rest of the world. And in this regard, the United States is around 26 trillion dollars or almost 80% of GDP in the red.
“This means that foreign investors have more American assets than the Americans abroad,” added Ford. “It is a setup that works well when trust is high, but in shaky times like 2025 it can be a pressure cooker.”
In fact, the times were shaky. The US dollar index has dropped by 10% this year, since the shock of Trump’s “Liberation Day” tariffs continues to reverberate and generates doubts about US assets that once regarded as reliable safe ports.
In fact, the leap of the dollar of the dollar has been worst since the United States has been a free exchange rate and the system of post-war II systems with fixed interest rates as part of the Bretton Woods Agreement have effectively ended.
In the meantime, the laws that give trillion dollars for fiscal deficits are progressing in the congress and causing more fear of concern among foreign investors, especially the US debts.
Going everything together, and this year was a textbook example of how a negative Niip profile can increase the turbulence of the currency, Ford warned.
“And because so much of the capital that comes from the US financial system comes from abroad, even small shifts can lead to great drainage,” he added. “These are many dollars that are sold and are less bought, and Voilà, the Greenback stumbles.”
Ford returned to the analogy for financial scorecard analogy and explained that the problem in concentration on the current employee deficit only shows the transaction flow, ie imports compared to exports.
In contrast, the Niip shows the total pile of debt – and ignoring that, like the assessment of a person’s expenditure habits, would be without checking their credit card amount, and trust “your most important asset”.
“Yes, trade deficits, interest rates and fed signals play a role, but the Niip tells them how exposing the United States when things go sideways,” concluded Ford. “It is the calm structural risk that lurks under the surface and is ready to strengthen shocks. And in such a year it called and does not whisper.”
The decrease in trust in the dollar has stimulated investors and central banks around the world Shopwhich has increased in the price in recent years and especially this year and rose by 21% in 2025.
Trump’s relentless pressure on the chairman of the Federal Reserve Jerome Powell to reduce interest rates weakened the dollar lately.
While many see even more downward potential on Wall Street for the dollar, the KI boom, which still moves billions of global investment in the USA Offers hope for relief.
