America’s investment position with the rest of the world
Is the world running away from American assets?
This week US Treasury reported that overseas investors bought a net $1.55tn of long-term US financial assets in 2025, up — yes, up — from a net $1.18tn in 2024.
What does this imply? One obvious point is it shows that fears of a “sell America” capital flight currently are wildly overdone, whatever the world thinks of Trump.
The key issue is captured in the so-called net international investment position (NIIP) data, which “measures the difference between US-owned foreign assets and foreign-owned US assets”,
to cite a handy primer from the Federal Reserve Bank of St Louis.
But one message to absorb from this story is that if the US tech bubble implodes, the pain will spread beyond America. Forbes calculates, for example, that if US equity prices and Foreign direct investment FDI, reverted to 2019 levels,
Norway, Canada, Sweden and China would see a reversal of the investment gains equivalent to 20-40 per cent of their GDP. Yikes.
Our global financial system is plagued with stunning, oft-ignored imbalances.
Maybe these will quietly correct (a bit) if the dollar falls this year, or tech stocks slide. But don’t bet on that.
While global investors keep rushing into the US, we face a wildly lopsided world.
Gillian Tett 20 February 2026
https://www.ft.com/content/8333387f-d23f-4fa8-b16d-365ff11a18ef
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