For a long time, this constant borrowing wasn't a problem, because the United States enjoyed a virtually limitless credit line abroad.
But that confidence is now gone. Once the US real estate bubble burst, it became clear just how shaky the foundation of the country's economic growth really is. Banks around the world could very well end up writing off hundreds of billions of dollars in bad debts. A number of major international banks have already fired their top executives for making overly risky investments.
I love the way some pundits look at and characterize the problem of the US trade deficit and budget deficit. They enjoyed the security and job growth from all that spending and borrowing by the US. Now they are crying because they realize that the US may not be paying for it in the end but the holders of US debt and investments in US securities will by taking a loss.
What to do with all those dollars you hold now? Start buying US manufactured goods and services and buy US assets inside the US like real estate.