Deutsche Bank revives 19th-century economics to explain US deficits

Who claims what

• —Deutsche Bank asserts that the implications of a 19th-century economic framework indicate that US deficits are unlikely to shrink in the near future — not independently verified (per Deutsche Bank)
• —Deutsche Bank claims ongoing capital flow into the US will continue, affecting dollar strength — not independently verified (per Deutsche Bank)
• —Deutsche Bank suggests that the analysis based on 19th-century economics has major implications for risk assets such as cryptocurrency — not independently verified (per Deutsche Bank)

Our assessment

If Deutsche Bank's analysis is accurate, prolonged US deficits and continued capital inflows could reinforce dollar strength, potentially impacting trade competitiveness for exporters and shaping the risk environment for financial and insurance sectors involved in cross-border transactions. Ongoing volatility in risk…