Both the trade and budget balance were in roughly zero until the 1980s when the budget deficit increased dramatically and the U.S.trade deficit increased dramatically.However,during the late 1990s the budget deficit shrank-in fact,moving to surplus-at the same time that the U.S.trade deficit increased significantly.Since 2000,the budget deficit has increased significantly,particularly after 2008.What is the relationship between a country's trade balance and its stance as a borrower or lender? Historically,has the U.S.been a net lender or net borrower? Why do you think that this is? Do you think that the U.S.budget situation might have anything to do with this?
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