Why does nation's total debt matter and not NIIP? Most people in the media talk about how the total debt level of a nation relative to its GDP is a measure of how "screwed" the country is. For example, see this: http://www.zerohedge.com/news/goldmans-sigma-x-hints-who-next-contagion-target

It seems to imply that UK is in bad shape but nobody seems to pay attention to it?
Japan also not looking good.

However, look at the Net International Investment Position (NIIP) of these countries:
UK: about 0% of GDP (equal amount of debt and assets)
Japan: >50% of GDP (Japan holds more assets than debt)

"A country's external debt includes both its government debt and private debt, and similarly its public and privately held (by its legal residents) external assets are also taken into account when calculating its NIIP"

If Japan needed to pay back its debt, couldn't it just sell some of the assets it holds and repay that way? 

Is there something I'm missing here? Which is the right way to look at things?
NIIP includes (and in fact is predominantly) personal assets.

The government of Japan could not sell the assets of its citizens to satisfy its sovereign debt.