Final answer:
If Americans increase their purchase of foreign assets, it could lead to an indeterminate outcome on various economic variables. Foreign investors buying more U.S. assets results in a financial inflow and decreases the current account balance, while an increasing U.S. trade deficit leads to a larger current account deficit.
Step-by-step explanation:
If Americans desire to increase their purchases of foreign assets, this would generally lead to an outflow of financial capital from the United States. When U.S. investors buy more foreign assets, they must convert their dollars into the currency of the asset they are purchasing, which could increase demand for that currency and decrease the value of the dollar. This scenario could have various outcomes on economic variables such as interest rates, exchange rates, and trade balances, likely making the ultimate effect on 'other things' such as consumer prices, domestic investment, and economic growth indeterminate without additional context. Additionally, if foreign investors buy more U.S. stocks and bonds, it would represent an inflow of financial capital to the U.S. economy and would show up as a decrease in the U.S. current account balance due to the fact that the financial account balance would increase.
Furthermore, if the trade deficit of the United States increases, it would mean that the country is importing more than it is exporting, which leads to a larger deficit in the current account balance.