[lehighguy]

The trade balance is a big problem. If it isn't addressed it will be lose lose. Current trends are simply unsustainable.

However, as posited earlier in my posts, the problem is largely domestic rather then international. We need to save more money. If you don't invest you don't own anything.

Foriegn investment is great for US GDP, not so great for US GNP. Though, as a said earlier, most of the foriegn investment so far has been in non-appreciable assets so it is not so much of a problem. The Chinese will take a huge bath on those treasuries just as the Japanese did on thier investments in the 1980s.

Of course, people in the US will have to deal with higher interests rates when this all hits the fan, which could be a big problem for GDP.