Posted on 05/07/2018 8:24:51 AM PDT by SeekAndFind
“Well, our nation will make about $20 trillion in GDP this year. How do you figure we’re spending more than we make?”
You’re arguing with a straw man here. I’m challenging the assertion that trade deficits are not relevant. Of course they’re relevant. They’re part of doing the math. Do the math.
Great comment. China had a 375 billion surplus in 2016 or 17 and the krauts (Germans) are not far behind. The damn I Phone alone is many billions. Apple making that phone in China and their stealing our Hi Tech from phones to PC’s is TREASON.
Thirty to fifty years ago, the stock market went up when the trade deficit went down, and went down when the trade deficit went up. Pretty logical when Americans produced most of what they consumed.
But now that so many US factories and jobs have been relocated to cheap labor nations, an increasing trade deficit means American consumers are buying more US brand products made in cheap labor nations, so transnational corps are earning more and the stock price increases. But, of course, the national debt also increases to make up for the consumption that exceeds what is produced in the US.
Lol, or buy US treasuries to help the US finance, through debt, what it can't finance through domestic production and government receipts.
I have a “trade deficit” with my grocer, mechanic, barber ...
Nope. That is a fallacy from fake New Age College Economics. You instead have a trade balance with your grocer, not a deficit.
You pay $20 for $10 hamburger meat, then you have a Grocer DEFICIT.
I pay $10 for $10 hamburger meat, then I have a Grocer BALANCE.
And I would LOVE to sell you overpaid stuff.
RE: You pay $20 for $10 hamburger meat, then you have a Grocer DEFICIT.
Don’t we all? The Grocer has to make a profit for the cost of his rent, employees, etc.
He’s not going to sell you $10 hamburger meat for just $10.00
So, it seems you are making my point — I have a TRADE DEFICIT, not a trade balance with my grocer.
How does that harm me? I’m simply paying for the product PLUS the convenience of buying it close to home.
RE: Lol, or buy US treasuries to help the US finance, through debt, what it can’t finance through domestic production and government receipt.
The problem then is TOO MUCH SPENDING. the government spends too much, exceeding the value of our domestic production.
Yeah, ok, they can buy government issued debt. If they don't then they have to invest it somewhere else. I can't convince the federal government to live within its means and not pay people to be unproductive, however, the idea that a current account deficit is inherently bad is nonsense ginned up by economic illiterates.
RE: The IBD Invester Business nimwits, buy an IPhone from China, but deceptively it is a FAKE IPhone, a phony empty plastic case.
THAT is for the iPhone consumers to decide. If it is fake, why would you and I continue to buy it? And why would there not be a warning to other consumers in terms of giving bad reviews?
Since the iPhone is a successful product used by millions, obviously it isn’t fake.
Your argument, above, is a straw man?
That was a question, not an argument. It wasn’t even a rhetorical question. In what ways is the economic arithmetic of a nation different from that of a business? How is a deficit not relevant? How does a trade deficit differ from any other kind of deficit?
The U.S. is not spending more than it makes. All our imports are paid for in cash.
The trade deficit is not debt.
What you're claiming would be true if we only made money from what we export. But we also make money from the goods we manufacture and sell within the U.S.. We use some of that money to buy goods from abroad.
Dozens of ways. Hundreds of ways.
How is a deficit not relevant?
How is a (trade) deficit relevant? You tell me.
How does a trade deficit differ from any other kind of deficit?
Never has to be repaid. Doesn't carry an interest rate.
“What you’re claiming would be true if we only made money from what we export. But we also make money from the goods we manufacture and sell within the U.S.. We use some of that money to buy goods from abroad.”
I’m not an economist: I’m not claiming, just asking. “We use some of that money to buy goods from abroad”—therein lies my question. How much is “some”? When does “some” become “too much”? How is that measured? I’m trying to imagine how trade deficits would not go into those calculations. At some point, you’re selling off your assets, not just the product of your created goods and services. And after that, you start running out of things to exchange with.
“What you’re claiming would be true if we only made money from what we export. But we also make money from the goods we manufacture and sell within the U.S.. We use some of that money to buy goods from abroad.”
I’m not an economist: I’m not claiming, just asking. “We use some of that money to buy goods from abroad”—therein lies my question. How much is “some”? When does “some” become “too much”? How is that measured? I’m trying to imagine how trade deficits would not go into those calculations. At some point, you’re selling off your assets, not just the product of your created goods and services. And after that, you start running out of things to exchange with.
But the transnational corporations have done more than their part to keep government spending always increasing. Trade policies and the export of thousands and factories and millions of jobs to cheap labor nations has added greatly to the cost of the government’s means tested poverty programs.
And businesses are also happy to hire the cheapest labor available domestically, legal or illegal, and have the taxpayers, present and future, pick up much or all of the medical expense and parts of other living expenses of their cheap workers.
And our real unemployment is around 20%, and has been for several years. Articles have been posted at FR within the past year about how in 20% of US families, no one has a job. And about how one in five US heads of household is on one or more means tested poverty programs.
There are many policies that have caused the ever growing spending, and trade and immigration policies are two are the biggest reasons. And business benefits from both of those.
You are not even in the ballpark.
IPhone customers do NOT decide.
Apple is not even a Company.
You may wish to take your horse blinders off and step out into the World. The entire World is FULL of fake products. China makes cheap knock off junk.
There exists no Apple Company because no Intellectual Property exists. No real companies. No real products. Only cheap fake products exist because customers cannot tell the difference.
Bob,s Knockoff shop makes IPhone assessories, that are not IPhone. He bribes officials. You continue to buy it because it looks real.
You get upset buying junk so you switch to Paul’s Knockoff shop. USA is the ONLY country with a moral law. Europe has minor exceptions.
Across the World IPhone is fake. DVDs are fake. Your food is fake. And no law exists to enforce genuine products unless you achieve Trade Balance and enforcement. Trade Deficits create trash.
The Grocer has a cashier at the cash register aisle.
The cashier does NOT talk about profit, nothing about rent, nor capital, nor benefits. The cashier says the price is $10 for hamburgwr, read the label. You pay $10 cash. That is a trade. That is a transaction. That is a balance.
That is a Trade BALANCE.
If you pay more or less than the price, that is a Trade Deficit.
You have a Trade Balance with your Grocer, unless you wish to act foolish.
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