The same can be said for the US’s overall external deficit. Unless the US can boost its savings rate relative to its internal investment needs, it will continue to need foreign capital inflows. And this, in turn, will require it to maintain a trade and current-account imbalance.
This is a level of monetary Ignorance quite staggering considering the melt down of 2008. Savings have nothing at all to do with Capital formation in the modern financialised economy . Banks are originators of Credit, this Bank of England research paper explains it very well and a Click on this Professor Richard Werner Link will probably yield a little surprise for this view of political economy