United States Trade Deficit and effect

United States Trade Deficit. In the recent years, United States has been faced with an unprecedented amount of borrowing.  It has also managed to support its overwhelming account deficit without experiencing significant challenges in foreign investors holding its assets. However, more need to be done in ensuring that the country attracts the same amount of extra foreign savings. This is because the US deficit has plummeted far enough to chew on the resources generated abroad. In fact, the level of borrowing has overtaken the amount of funding from other countries. The trade deficits has also been linked to the current rapid economic globalization (Higgins & Klitgaard, 2007). As a result, there has been increasing interest from various stakeholders regarding the growing United States current account deficit. These concerns have led to generalized view that the current state of global imbalances is unsustainable. Therefore, change will have to take place in the near future. The heightened increase in the US current account deficit has increased analyst worries. Some of the analyst argues that this trend is unsustainable. Other views that the world will be faced by a sweeping financial crisis while other predict the prospect of dollar collapsing and hence financial meltdown (Edward, 2005). These issues relating to the performance of the United States economy are a matter of interest to the rest of the world. A reflection on United States trade deficits helps in understanding its impact and sustainability