The US is in the position of having a large trade and current account deficit (imports+payments < exports+receipts):

The net capital inflows (or, as Mankiw likes to call them, negative outflows) that balance out that current account deficit include inflows from debt issued by US entities that is purchased by foreign entities. The result is the US taking on debt from other countries. (For example, if the US issues a bond and sells it to China, there is a capital inflow from the sale of the bond, but there will follow an increase in the amount of debt the US owes (debt is a liability to pay bond interest and to pay back the principal amount of the bond) and a stream of interest payment.

"Your Uncle" (who has already needed calming down over his concerns about the budget deficits and the National Debt in a previous module) now calls you in a panic. "I just saw the enormous trade deficit for February - $89.2billion for the month! This is terrible! Not only are jobs being lost to other countries but, to finance this deficit we are getting more and more in debt to foreign countries. Pretty soon we'll be issuing new international debt just to pay the interest on the old foreign debt."

Try and give your Uncle some perspective. Point out two positive and two negative aspects of the situation.