CHAPTER III
THE NATIONAL WEALTH—THE EXTERNAL
POSITION
What may be described as the external position comprises the ownership of property and the debits and credits on accounts that extend beyond our national boundary lines. The internal position relates only to the property existing within the nation. Internal accounts and obligations pertain to the division of wealth among ourselves, but although the proportionate division may change, the aggregate wealth of the nation—of the people as a whole—may remain the same. Previous to the war the external position of the American people was relatively simple. Now it has become complicated and extensive. The external position at present may be classified as follows:
Credits.—(1) Indebtedness of foreign governments to the American government. This represents advances, made during the war and subsequently, by the American government to the allied governments.
2. Funded foreign obligation. This comprises the foreign governmental, state and municipal bonds that have been purchased privately by people in this country and are held by them.
3. Unfunded foreign obligation. This includes the obligations of people in foreign countries to people in this country on open accounts, which have arisen mainly through the purchase of more goods from us than the
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