Free Republic

The United States should not let friction over economic and trade policies undermine the hugely important business relationship with China, Vice President Xi Jinping said in an interview published before a scheduled U.S. visit. Xi, widely viewed as China's president-in-waiting, told the Washington Post via written answers to questions that China was of huge economic benefit to the United States. "As economic globalization gathers momentum, China and the United States have become highly inter-dependent economically," Xi said, according to a transcript posted on the newspaper's website on Monday. "Such economic relations would not enjoy sustained, rapid growth if they were...

The United States has run up a cumulative $7.5 trillion Trade Deficit. The last time the country ran a trade surplus was in 1976. Nixon closed the Gold Window in 1971. Do you believe it's just a coincidence that the rise of an un-backed Fiat Dollar and the rise of the Trade Deficit haapened so close in time? The Country has been in a pronounced economic decline since the 1970's and when the Gold Window was closed. Since then the money supply has increased many times and so has inflation. While living standards have declined, so has domestic energy production....

Europe’s debt crisis takes toll in China as exports slow By Keith B. Richburg, Published: November 24 BEIJING — Exports are down. Some small factories have closed. Growth projections for next year have been lowered. Foreign exchange reserves have lost their value. And in a further sign of just how badly the continuing debt crisis in the euro-zone economies is affecting China, a few economists here are even speculating that China could soon see its first trade deficit in two decades.

Have we as a nation become unaware of the world? We were once the single most innovative, powerful manufacturing nation on Earth. In all of human history. We were the first to the moon. We have been a nation of leaders, pioneers and builders.

In the clearest indication yet that Obama's policies are harming the country and the economy, the US balance of trade showed a $50 billion deficit for May spurred by high oil prices, spurred by a weak dollar and lack of domestic energy production- all policies favored/created by Hurricane O's economic gurus.   The deficit increases the odds that economic growth for the year will have to be revised downward again from 1.9 percent annually, threatening to push the economy into recession territory again. Watch for the jobs market to sink back into the red. And whatever happens with the budget, don't count on federal...

For those who may not have noticed it, the headline says "deficit" and pertains to Japan: once upon a time a booming export economy. The reason: the ongoing collapse in export trade, after May exports dropped by 10.3% from a year ago, and just better than April severe economic contraction of 12.4%. Consensus was for an 8.4% decline. The net result was a monthly deficit of 853.7 billion yen, or $10.7 billion, the second biggest inverse surplus ever.

WASHINGTON (MarketWatch) — The U.S. trade deficit widened sharply in March to the highest level in nine months despite a new record high for exports of goods and services, government data showed Wednesday. The trade deficit — that is, the difference between exports and imports — widened to $48.2 billion for the month from a downwardly revised $45.4 billion in February, originally reported as $45.8 billion. Imports of goods and services rose by 4.9% to a seasonally adjusted $220.8 billion during March, while exports rose 4.6% to $172.7 billion, the Commerce Department estimated. This was the biggest one-month jump in...

China should reduce its excessive foreign exchange reserves and further diversify its holdings, Tang Shuangning, chairman of China Everbright Group, said on Saturday. The amount of foreign exchange reserves should be restricted to between 800 billion to 1.3 trillion U.S. dollars, Tang told a forum in Beijing, saying that the current reserve amount is too high. China's foreign exchange reserves increased by 197.4 billion U.S. dollars in the first three months of this year to 3.04 trillion U.S. dollars by the end of March.

China unexpectedly posted a trade deficit in February, according to official data released Thursday, and economists said this could reduce pressure on the country to allow its currency to appreciate. The rate of growth for both import and export indicators tapered off considerably from the levels seen in January, distorted by the Chinese New Year holidays during the month. Monthly exports grew a modest 2.4% from the year-earlier period, while imports grew 19.4%, after soaring 37.7% and 51%, respectively, in January. The slowdown swung the country’s trade balance to a deficit of $7.3 billion in February, more than offsetting January’s...

I wrote in a previous articleabout why America's manufacturing sector, despite record output, is actually in very deep trouble. Record output doesn't prove the sector healthy when we are running a huge trade deficit in manufactured goods, i.e. consuming more goods than we produce, and plugging the gap with asset sales and debt. But this analysis of the problem only touches the quantitative surface of our ongoing industrial decline. Real industries are not abstract aggregates; they are complex ecosystems of suppliers and supply chains, skills and customer relationships, long-term investments and returns. Deindustrialization is thus a more complex process than...

Americans presumably realize by now that living in a bubble economy, while exhilarating as long as the champagne lasts, is not a good move. Therefore it is worth understanding why the biggest bubble of all may be yet to pop. I refer to America's trade imbalance with the rest of the world. As I explained in a previous article, our trade deficit with the rest of the world means that we must a) borrow money and b) sell existing assets in order to cover the yawning gap between our imports and our exports. And while a rich nation can indeed...

Weekly jobless claims, headline inflation and the US trade deficit all moved higher, according to data released Thursday that posed more questions for the economic recovery. The number of people filing new claims for unemployment insurance rose to a higher-than-expected 462,000 in the latest week, the Labor Department said on Thursday, while the number of people still collecting jobless benefits fell to an almost two-year low. First-time jobless claims rose 13,000 in the week ended Oct. 9 from the prior week's upwardly revised 449,000 seasonally adjusted claims. The four-week average of first-time jobless benefits, which economists prefer because it smoothes...

The trade deficit bottomed at $24.9 billion in May 2009, just before the current economic recovery began. Now, a rising trade deficit and continued weakness among regional banks threatens to derail the recovery. If the economy goes down a second time, it will not likely recover easily or quickly. The unemployment rate will rise into the teens and conditions reminiscent of the Great Depression will prevail through much of the nation. Oil and consumer goods from China account for nearly the entire trade deficit, and without a seismic change in energy and trade policies, the U.S. economy faces grave peril.

World economic recovery driven by global imbalances By Neil Irwin Washington Post Staff Writer Friday, July 9, 2010; A01 The catastrophic economic downturn that began two years ago was supposed to shake up the global economy, ending an era in which Americans consumed too much and saved and exported too little. But the recovery is being driven by a return to the very global imbalances that were a major cause of the crisis. Americans' savings rates have fallen over the past year, imports are rising faster than exports, and countries around the world are again turning to Americans to be...

Future Fuels: Our secretary of energy pushes bio-refineries and windmills to oil executives at an energy conference as the administration announces a three-year offshore drilling ban. This is a policy for economic suicide. They don't qualify as an official group of victims, but carbon-Americans, as they have been called, did not have much to cheer about last week, when Energy Secretary Steven Chu addressed CERAWeek 2010, a premier industry conference hosted by IHS Cambridge Energy Research Associates. With an economy struggling to regain sound footing, Chu advocated a starvation diet devoid of additional fossil fuels that are to remain under...

Feb. 24, 2010, 11:28 p.m. EST China says it may swing to trade deficits in next six months By Chris Oliver, MarketWatch HONG KONG (MarketWatch) -- China could post trade deficits over the next six months, as the export recovery remains weak while the trend of strong import growth remains intact, according to reports Thursday citing a Commerce Ministry spokesman. Ministry spokesman Yao Jian was quoted as saying exports won't regain their potential growth momentum for two to three years, even though gains against year-earlier results were recorded for the past two consecutive months. The Great Recession has caused a...

Energy: A new study shows that our reluctance to develop domestic energy will cost the beleaguered U.S. economy trillions in opportunity costs, reduce our gross domestic product and increase our trade deficit. From trying to stimulate jobs in nonexistent ZIP codes at great expense to worshiping the false gods of climate change, our biggest deficit these days may be in the area of common sense. A new study shows that many of our wounds are self-inflicted as we forgo the wealth and jobs to be found in our waters and under our feet. The study by Science Applications International Corp....

Feb. 10, 2010, 11:18 a.m. EST U.S. trade deficit widens to $40.2 billion in December By Rex Nutting, MarketWatch WASHINGTON (MarketWatch) -- The U.S. trade deficit widened to a seasonally adjusted $40.2 billion in December as imports of crude oil surged, outpacing a large increase in exports, the Commerce Department reported Wednesday. It was the largest trade gap in a year. "The report has a strong-economy feel to it, as exports and imports were both up sharply," wrote economists for Goldman Sachs. The wider-than-expected trade deficit should lead to a downward revision to fourth-quarter gross domestic product to about 5.6%...

India China Paradox Sheila Archambault, January 27, 2010 Sheila Archambault The main question should not be if India will economically catch up with China but if India should try to catch up with China, said a scholar at a Heritage Foundation event discussing India and China’s future and current position in the international political economy. Some leaders in India argue that India and China are different countries, with distinct cultures and histories, so India should feel no obligation to try to catch up with China, but instead, India should develop at its own pace and in its own way, said...

Bloomberg copywrite - headline only http://www.bloomberg.com/apps/news?pid=20601087&sid=a9NuboNd9OTA

If you were troubled by President Obama's "Wow Bow" in Japan, you won't be any happier with the "kowtow" during his just-concluded trip to the People's Republic of China. In the latest chapter of Team Obama's at-best-mediocre, teetering-on-the-disastrous foreign policy, the president and a slew of Cabinet secretaries roared into Asia like lions, promising a new era in US diplomacy in the region. But they're leaving like pussycats -- accomplishing, well, a whole lot of nothing so far. So much for our "first Pacific president," as Obama anointed himself at the start of the eight-day, four-country swing through Asia last...

The U.S. trade deficit expanded in September by the most in a decade as rising imports of petroleum, autos and manufactured goods from China wiped out an otherwise impressive gain in exports, which reached their highest level since December. The trade gap jumped 18.2 percent, widening from $30.8 billion in August to $36.5 billion in September, the Commerce Department reported Friday. It was the largest monthly imbalance since January but it remains well below the peak deficit of $65.9 billion in July 2008, when oil prices reached record levels just before trade flows collapsed around the world. (snip) Exports in...

Earlier today, Doug Bandow weighed in with some commentary on the problems that Buy American provisions are creating for both Canadian and American businesses. Let me reinforce his view that such rules are anachronistic and self-defeating with some thoughts from a forthcoming paper of mine about the incongruity between modern commercial reality and trade policies that have failed to keep pace. Even though President Obama implored, “If you are considering buying a car, I hope it will be an American car,” it is nearly impossible to determine objectively what makes an American car. The auto industry provides a famous example,...

If the U.S. trade deficit were to disappear, do you think that would be a good or bad thing? For years, many in the media and the political world wailed about the U.S. trade deficit, but it is rapidly disappearing -- and the consequences are going to be disastrous. [snip]Over the past several decades, many foreign countries -- notably Japan and China -- exported much more to the United States than they imported, and as a result, they accumulated several trillion U.S. dollars. Most of those dollars were, in turn, invested back in the United States. [snip] However, when trade...

<p>BEIJING – The contraction in China's manufacturing worsened in March, data showed Wednesday, and President Hu Jintao told a state news agency that the country's economic problems are increasing.</p> <p>The purchasing managers index by brokerage CLSA Asia-Pacific Markets — based on a survey of some 400 companies — showed manufacturing shrank for an eighth month. It fell to 44.8, down from February's 45.1, on a scale where numbers below 50 show activity is shrinking.</p>

Today’s TIC data … Posted on Monday, March 16th, 2009 By bsetser John Jansen is right; today’s TIC January data was a disaster. $150 billion in (net) capital outflows (-148.9 billion to be precise) cannot sustain even a $40 billion trade deficit. I also though have learned that the TIC data doesn’t necessarily match the trade deficit on a monthly basis — and on occasion it moves in ways that seem inconsistent with the market. If the big outflow had come in December (a month when the dollar slid) rather than January, the flow data and the market move would...

U.S., China Seek Healthier Relationship By MARK GONGLOFF MARCH 13, 2009 AHEAD OF THE TAPE Wall Street Journal Us Trade Deficit with China going down ? LOOK AGAIN.

Japan’s January exports down 45% year on year TOKYO, Feb 25 - Japan’s exports nearly halved in January from a year earlier, pushing its trade deficit to the biggest on record, in further evidence that the global financial crisis is paralysing the world’s second-largest economy. Exports to Asia slumped at a record pace as manufacturing within Asia, which had thrived on robust global growth until last year, slumped as Western consumers curtail their spending. ”Exports to Asia, particularly to China, are tumbling at about the same pace as shipments to the United States, signalling that even China’s economy may be...

Can the United States run a trade deficit - where the United States imports more than it exports - forever?Most commentators have argued the big trade deficits the United States has run over the last couple of decades eventually will cause great economic hardship or even disaster in the United States. In fact, the United States has run trade deficits for most of its history, and the disaster has yet to strike. How can this be?Federal Reserve economists recently examined the data carefully and come up with solid explanations. The following summarizes and simplifies some of their key findings as...

From the producers of Wordplay and the studio that brought you Supersize Me, the must-see documentary I.O.U.S.A. uncovers the source of critical economic concerns that touch the lives of every American. A tapestry of archival footage, hard data and candid interviews woven together, it paints an authentic profile of today’s economic condition. Solutions for how we can impact this nationwide crisis and evolve into a more fiscally sound nation for future generations are offered by the documentary’s powerful conclusion. “May be to the U.S. Economy what An Inconvenient Truth was to the environment.” - Reuters

Trade Facilitation by: Ben Giles, July 15, 2008 The Cato Institute’s Daniel Ikenson and World Bank’s Simeon Djankov presented the findings of a new Cato trade policy analysis at the Rayburn House Office Building on July 11. Ikenson’s paper, entitled Protection without Protectionism: Reconciling Trade and Homeland Security, highlights the disconnect between Americans’ perception of the economy and the realities of international trade. “The polls tell us that Americans have soured on trade…” said Ikenson. “It’s because Americans are barraged nightly by reports on the news that they’re losing their jobs and that the economy is imperiled by globalization and...

Feb 21, 12:34 AM EST Japan posts trade deficit in January due to rising oil prices TOKYO (AP) -- Japan's trade deficit in January was more than 20 times greater than the deficit in the first month of 2007 as rising oil prices boosted the values of imports, the Finance Ministry said Thursday. The gap widened to 79.3 billion yen (US$734 million; €501 million) from last year's 3.5 billion yen, the ministry said. The results were far worse than the 5.6 billion yen (US$52 million; €35 million) deficit estimated by economists polled by Dow Jones and Nikkei. Japan normally runs...

Last week, NRO TV featured a video discussion series about the economy featuring Peter Robinson and economists John Taylor and Kenn Judd. I thought you’d want to check it out. You can view “The Economy According to Taylor and Judd” in entirety here: http://tv.nationalreview.com/uncommonknowledge/. You can also watch specific segments of the discussion from that link: Chapter 1: Recession Chapter 2: Sub-prime Crisis Chapter 3: Economic Stimulus Package Chapter 4: Economy as a Campaign Issue Chapter 5: Tax cuts vs. Spending cuts

Contrary to popular wisdom, China's rapid growth is not hugely dependent on exports MOST people suppose that China's economic success depends on exporting cheap goods to the rich world. If so, its growth would be seriously dented by a stuttering American economy. Headline figures show that China's exports surged from 20% of GDP in 2001 to almost 40% in 2007, which seems to suggest not only that exports are the main driver of growth, but also that China's economy would be hit much harder by an American downturn than it was during the previous recession in 2001. If exports are...

"Toyota Motor Corp. overtook Ford Motor Co. to become the No. 2 automaker by U.S. sales in 2007, using new products and relentless strategy to break Ford's 76-year lock on the position. Toyota sold 2.62 million cars and trucks in 2007, which amounted to 48,226 more than Ford, according to sales figures released Thursday. Toyota's sales were up 3 percent for the year, buoyed by new products like the Toyota Tundra pickup, which saw sales jump 57 percent. Ford's sales fell 12 percent to 2.572 million vehicles."

As the trade deficit between the United States and China continues to increase, should Americans be worried? Or should they be cheering China’s trade liberalization and enjoying the bargains? The Hoover Institution has just released “The U.S.-China Trade Deficit: Reason for Worry?” It’s a good summary of the China-U.S. trading arrangement, and it addresses both benefits and concerns about the relationship as expressed by both Chinese and American parties. http://www.hoover.org/research/focusonissues/focus/12436706.html

U.S. Manufacturing Obituaries Premature by: Heyecan Veziroglu, December 03, 2007 Instead of mischaracterizing the significance and meaning of the U.S. trade deficit and assuming that the loss of 3 million manufacturing jobs four years ago requires a tough response today, policymakers should try to attain a better understanding of the condition of U.S. manufacturing, Cato Institute policy analyst Daniel Ikenson pointed out in a Capitol Hill briefing that the think tank held recently. While the U.S.-China trade deficit for goods and services combined has been growing at approximately 23% per annum, the United States remains the world’s most prolific manufacturer,...

WASHINGTON (AP) -- The U.S. trade deficit fell to the lowest level in 28 months as a falling dollar spurred U.S. exports to an all-time high. The deficit with China jumped to the second highest level on record as imports of toys and other goods surged despite a rash of safety recalls. The Commerce Department said Friday that the deficit for September dipped by 0.6 percent from the previous month -- to $56.5 billion. That was the narrowest trade imbalance since May 2005 and took economists by surprise. They had been forecasting the deficit would rise. The improvement came from...

<p>George Lesser expressed the usual awe-struck reaction to Shanghai ("Oil for the lamps of China," Commentary, Oct. 21). I first saw the magnificent skyline at night, on a long cab ride from Hongqiao International Airport down to the waterfront Bund, across from the imposing new developments in Pudong.</p>

Trade: Media reports are filled with the "good news" that the trade deficit has shrunk — or rather, as pundits and headline writers like to say, "improved." But is a smaller deficit really a good thing? Maybe not. "Trade Deficit Improves Significantly," the Associated Press headline said, in a sentiment that is likely to be repeated in dozens of newspapers across the country. Thanks to the weaker dollar, the trade red ink fell 2.4% to $57.6 billion in August. Exports rose 0.4% to a record $138.3 billion, while imports fell by the exact same amount to $195.9 billion. As economist...

WASHINGTON (AFP) - Even as protests grow about US imports from China, many Americans may find it hard to manage without the range of products that dominate or in some cases monopolize the marketplace. Safety concerns over Chinese-made goods prompted further comments in Congress over the past week and led President George W. Bush to establish a new panel to review the safety of imported goods. Yet economists and consumers say that Chinese-made products have become so ubiquitous it may be next to impossible to wean Americans off low-cost imports. Sara Bongiorni, a journalist and author of "A Year Without...

The first shipments of Chrysler cars built by China's Chery Automobile Co. could reach the U.S. or Europe within 30 months, Chrysler said on Wednesday, opening the door for Chery to be the first mainland auto maker to do so. "The first product within one year, and then into the United States and western Europe within two to 2- years," Chrysler Group chief executive Tom LaSorda told reporters. The first auto built by Chery Automobile Co. for Chrysler could be exported to North America, but not the United States, said LaSorda, who made the forecast at a Beijing signing ceremony...

Why trade deficit matters By Hans D. Baumann InTech News, May 1, 2007 The U.S. trade deficit could affect the future of your jobs, the location of our plants, and it might even cause the next recession. Our current trade deficit with China has reached $21 billion per month. It means we bought $21 billion more in one month from China than the value of goods we sold them. This makes the trade deficit with China alone about $250 billion on a yearly basis. Adding the trade deficits with Europe and Japan, among others, we had a record total...

Remember: The June 1989 Tiananmen revolt was fueled not just by a desire for more freedom, but by anger over high inflation.

I'm told to worry about the trade deficit. Commentators and populist politicians are wringing their hands. The trade deficit is a "malignant tumor in the intestines of the U.S. economy," says Pat Buchanan. Lou Dobbs is very upset that "We're borrowing about $3 billion a day just to pay for our imports"! Economists had taught me that the trade deficit is not a big deal. (The budget deficit may be a big one, but that's a different issue.) But with all the pundits and politicians alarmed, I began to wonder if I was out of touch. ... What the trade...

AP - China's 2006 global trade surplus jumped nearly 75 per cent from the previous year to a record $US177.5 billion ($A227.7 billion), a state news agency said on Wednesday in a report that could fuel US complaints about market barriers and currency policy. China's trade gap has soared as it became the world's low-cost manufacturing centre, churning out furniture, toys, shoes and other goods, often for sale under foreign brand names. The jump in the trade gap came despite a small but steady rise in China's currency, the yuan, over the past 18 months. Washington is pushing for a...

WASHINGTON - America's deficit in the broadest measure of trade shot up to an all-time high in the summer, reflecting the huge jump in the country's foreign oil bill. The Commerce Department reported Monday that the current account trade deficit increased 3.9 percent to a record $225.6 billion in the July-September quarter. That represented 6.8 percent of the country's total economy, up from 6.6 percent of the gross domestic product in the spring quarter. The current account is the broadest measure of U.S. trade because it tracks not only the flow of goods and services across borders but also investment...

PROMOTING GOLDMAN ON GOVT TAB by Jim Willie CB December 13, 2006 US Treasury Secy Hank Paulson and USFed Chairman have embarked upon yet another trip to China, joined even by Commerce Secy Gutierrez. This Strategic Economic Dialog between the Untied States and China deserves comment. The official reasons stated are to discuss economic and banking reforms, more like a begging session for China not to torpedo the USEconomy. In my opinion, that is in part a cover smokescreen. Paulson publicly cites the need for China to make quick progress on economic changes toward an open market society, like with...

"WASHINGTON (AP) -- America's trade deficit posted a dramatic decline in October, falling to the lowest level in 14 months as the price of crude oil plunged by a record amount. But America's deficit with China hit an all-time high, reflecting a surge in shipments of toys, televisions and computers as retailers stocked their shelves for holiday shoppers. The Commerce Department reported Tuesday that the deficit fell to $58.9 billion in October, down 8.4 percent from September. The percentage drop was the biggest since December 2001. It pushed the monthly deficit down to the lowest level since August 2005. The...

Oil producers shun dollar By Haig Simonian in Zurich and Javier Blas and Carola Hoyos in London Published: December 10 2006 Oil producing countries have reduced their exposure to the dollar to the lowest level in two years and shifted oil income into euros, yen and sterling, according to new data from the Bank for International Settlements. The revelation in the latest BIS quarterly review, published on Monday, confirms market speculation about a move out of dollars and could put new pressure on the ailing US currency. Market liquidity is traditionally low in December, and many traders have locked in...