“So the entire $178.96 estimated wholesale cost of the shipped phone is credited to China, even though the value of the work performed by the Chinese workers at Hon Hai Precision Industry Co. accounts for just 3.6%, or $6.50, of the total, the researchers calculated in a report published this month.”
How convenient because they’ll never see the entire $178.96 after the currency moves.
That's another way people don't understand trade deficits, they think a weak dollar can bring it down. That's stupid because exchange rates don't affect the trade deficit.
The usually ignored fact is that when Americans buy things from foreigners, they have to exchange dollars for foreign money first before they buy. Foreigners then have to use those same dollars to buy American stuff, so it always balances. The only way we can have a deficit in goods'n'services is when it's paid by a surplus in capital goods like stocks 'n bonds.