U.S. trade deficit widens as exports hit three-year low
Source: Reuters
Dec 4 - The U.S. trade deficit widened unexpectedly in October as exports fell to a three-year low, suggesting that trade could again weigh on economic growth in the fourth quarter.
The Commerce Department said on Friday the trade gap rose 3.4 percent to $43.9 billion, a sign that the worst of the drag from a stronger dollar was far from over. September's trade deficit was revised up to $42.5 billion from the previously reported $40.8 billion. The government revised trade figures going back to April to incorporate more comprehensive and updated quarterly and monthly data.
Economists had forecast the trade gap shrinking to $40.5 billion in October. When adjusted for inflation, the deficit increased to $60.33 billion from $57.37 billion in September.
Read more: http://www.reuters.com/article/us-usa-economy-trade-idUSKBN0TN1GM20151204#7iaaQ1ATKk2I0iUC.97
Do our never ending trade deficits really matter? Seems like they do...
"Many attempts have been made to create economic excuses for the trade deficit. A frequently heard claim is that trade deficits do not matter, while others argue that the trade balance is generally determined by macroeconomic factors.1 Both views suggest that trade deficits will be largely unresponsive to trade policies, and may be safely ignored, as long as the nation is following sound macroeconomic policies.
These laissez-faire views are both wrong and dangerous to the health of our economy. One major source of confusion is the use of simple correlations, or economic identities, in the place of meaningful economic analysis of the causes of our trade problems. The most recent Economic Report of the President makes this mistake in several places, as shown below. The Report emphasizes the accounting relationship between savings and investment without sufficiently examining the cause of changes in these variables. Improvements in our trade balance, through increased exports, can increase income and hence raise national savings, thereby reducing our reliance on imported capital while creating better jobs in the economy at the same time. If, on the other hand, we ignore the trade deficit, our incomes will continue to stagnate and the risks of an economic collapse will grow in the future."
http://www.epi.org/publication/trade-deficits-consequences-policy-implications/
melm00se
(4,990 posts)Populist_Prole
(5,364 posts)As the corporatista apologists spew forth.
Trade deficit dips ( small dip on an otherwise upward trend ) = We're doing great! We need more of this! Yay!
Trade deficit kepps going up = The trade dficit doesn't matter. Consumers! Walmart! Yay!
No way in hell we're ever going to come close to a trade balance via exports, let alone reverse it, even moreso run a surplus.