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Trade Deficit Improves Significantly: Record Exports
by gryphon | October 11, 2007 at 09:41 am | 285 views | 6 comments
by gryphon
More good news on the economy. After 22 straight quarters of economic growth we now have a trade deficit that is shrinking and record levels of exports.
"The U.S. trade deficit fell to the lowest level in seven months, helped by record-high sales of American products and the declining value of the dollar. The deficit with China declined as imports edged down slightly following a string of high-profile recalls."
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October 11, 2007 at 09:41 am by gryphon, 285 views, 6 comments
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Comments (6)
at 10:08 on October 11th, 2007
gryphon, good stuff.
Probably won't be reported all that much though. I remember a couple of days ago the Huffington Post was decrying the fact that we were buying less from abroad. But it seems to have led to something better.
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gryphonat 10:11 on October 11th, 2007
Like Fred Thompson said two days ago, "Its the Greatest Story never Told"
thx for the flag
at 10:47 on October 11th, 2007
gryphon, I saw this in the Financial Times and, with your permission, I include it here as it supports your article. The suggestion here is that the weak dollar is self correcting - which is really good news.
US EXPORTS HIT RECORD ON WEAK DOLLAR
By Eoin Callan in Washington
Published: October 11 2007 15:08 | Last updated: October 11 2007 15:08
US exports hit a record according to the latest figures, which showed a consistent improvement in the trade deficit of the world’s largest economy amid demand from Europe and Asia.
The trade gap narrowed more than expected in August to $57.6bn from $59bn and the deficit for the previous month was also less than initially thought, the Commerce Department said.
The strong global demand for US goods comes at critical moment for the American economy as the downturn in housing market and credit squeeze heighten fears of a recession.
The figures released on Thursday showed there was a ”defining turn in the US trade deficit”, according to Alan Ruskin, an analyst at RBS.
US exporters have enjoyed an added filip from a slide in the value of US currency, which makes American goods more affordable overseas, but Mr Ruskin said the steady improvement in the balance between exports and imports ”has the capacity to restrain US dollar weakness in the longer term.”
at 11:23 on October 11th, 2007
Good point Anglo and thanks for adding that.
I think it's also important to add that when economics are concerned it is often best to let things fix themselves and not to overreact by, say, imposing draconian sanctions against one of largest trading partners (China).
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ryanat 11:57 on October 11th, 2007
gryphon, i think one factor that needs to examined is the fact that the loss of value in the housing market has slowed consumption of consumer goods. and as noted in the article you linked to the drop in imports was in the area of furniture and computers not the goods which were recalled:
However, the small drop came in such areas as computers and furniture,
where there have not been highly publicized recalls. Imports of toys
from China actually rose as American retailers stocked their shelves
for Christmas.
Both items, especially furniture, relates to the housing market.
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gryphonat 17:56 on October 11th, 2007
good catch.