1. Did the U.S. run a current account deficit or surplus in 2019 and in 2020? Why? Please briefly explain.
2. Will budget deficits necessarily cause current account deficits? Use the current account identity to explain.
3. Based on U.S. current account balances in 2019 and 2020, did the U.S. run a financial account deficit or surplus? Use the balance of payments identity to explain. Then you can compare this with the data in the capital account.
4. Is the U.S. considered a net borrower or a net lender in both years? What does this mean for U.S. net holdings of external assets?
   

Bureau of Economic Analysis Table 1.1. U.S. International Transactions Millions of dollars] Release Date: March 23, 2021 - Next Release Date: June 23, 2021 Line 2019 2020 Capital account 17 Capital transfer receipts and other credits 67 406 18 Capital transfer payments and other debits 6,311 6,435 Financial account Net U.S. acquisition of financial assets 19 excluding financial derivatives (net 440,751 763,477 increase in assets / financial outflow (+)) 20 Direct investment assets 188,469 153,257 21 Portfolio investment assets 46,570 350,213 22 Other investment assets 201,053 251,033 23 Reserve assets 4,659 8,974 Net U.S. incurrence of liabilities excluding 24 financial derivatives (net increase in 797,960 1,503,746 liabilities / financial inflow (+)) 25 Direct investment liabilities 351,629 212,396 26 Portfolio investment liabilities 179,980 759,972 27 Other investment liabilities 266,350 531,379 28 Financial derivatives other than reserves, -38,340 -3,297 net transactions 2 Statistical discrepancy 29 Statistical discrepancy 3 90,921 -90,326 29a Of which: Seasonal adjustment discrepancy . . . . . . . ... Balances 30 Balance on current account (line 1 less line 9 ) 4 -480,226 -647,210 36 Balance on capital account (line 17 less line 18) 4 -6,244 -6,030 Net lending (+) or net borrowing (-) from 37 current- and capital-account transactions -486,470 -653,240 (line 30 plus line 36) 5 Net lending (+) or net borrowing (-) from 38 financial-account transactions (line 19 less -395,549 -743,566 line 24 plus line 28) 5Bureau of Economic Analysis Table 1.1. U.S. International Transactions [Millions of dollars] Release Date: March 23, 2021 - Next Release Date: June 23, 2021 Line 2019 2020 Current account Exports of goods and services and income receipts (credits) 3,805,938 3,227,607 2 Exports of goods and services 2,528,262 2,127,254 3 Goods 1,652,437 1,435,128 4 Services 875,825 692, 126 5 Primary income receipts 1,135,691 958,314 6 Investment income 1,128,966 952,148 Compensation of employees 6,725 6, 166 8 Secondary income (current transfer) receipts 1 141,984 142,040 9 Imports of goods and services and income 4,286,163 3,874,818 payments (debits) 10 Imports of goods and services 3,105, 127 2,808,954 11 Goods 2,516,767 2,350,698 12 Services 588,359 458,256 13 Primary income payments 899,347 776,740 14 Investment income 880,562 761,297 15 Compensation of employees 18,785 15,443 16 Secondary income (current transfer) payments 281,689 289,124 Balances 30 Balance on current account (line 1 less line 9) 4 -480,226 -647,210 31 Balance on goods and services (line 2 less -576,865 -681,700 line 10) 32 Balance on goods (line 3 less line 1 1) -864,331 -915,570 33 Balance on services (line 4 less line 12) 287,466 233,870 34 Balance on primary income (line 5 less line 181,574 13) 236,344 35 Balance on secondary income (line 8 less line -139,705 -147,084 16)