Record Trade Deficit in January Fuels Political Fight

Discussion in 'Politics, Religion, Social Issues' started by zimv20, Mar 10, 2004.

  1. zimv20 macrumors 601

    zimv20

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    #1
    link

     
  2. Desertrat macrumors newbie

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    #2
    "Yeah, man, but that Harbor Freight has some really neat prices on tools!" or, "Hey, that Lexus is way cool!"

    Until folks think in terms of buying less "stuff" and saving whatever they can, the trade imbalance will continue. Possibly, the ongoing weakening of the dollar may push prices up, which would slow the buying. That's why the Bushies are pushing on China to float the yuan. Trouble is, the Chinese don't want to playthat game, since it would hurt their exports to us...

    That ol' debbil, awl, is in the picture, too. And OPEC is talking about cutting back on production to get the price higher. After all, they're getting paid in dollars, which means they've already lost billions in buying power.

    But rest assured, Dearly Beloved, we're gonna hear a bunch of total BS from both sides on this issue. And neither party has a solution; it's up to the buying public.

    'Rat
     
  3. Ugg macrumors 68000

    Ugg

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    There's any number of angles to this but the most important IMO, is that US exports fell for the second month in a row even though the dollar is at an historic low. Not a good thing for gw & co. given that their push for a devalued dollar was supposed to result in an uptick in exports.

    I don't know how companies deal with this but all the outsourcing must in some way be affecting the import/export figures. Anyone have any ideas on this?
     
  4. Desertrat macrumors newbie

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    "I don't know how companies deal with this but all the outsourcing must in some way be affecting the import/export figures. Anyone have any ideas on this?"

    I don't know. Speculation is about all I can do...

    I imagine a lot of the increase in the dollar amount of imports has to do with the increased cost of oil and refined products. This recent winter has seen more driving than usual. Plus, we import a lot of natural gas from Canada, and that's another item with a higher cost than just a couple of years back. Just these two items would quite possibly offset any mild reduction in consumer purchases of foreign-made items.

    One example I have a bit of knowledge about is the world of cars. We once made all US-car engines here. Now, we import Buick V6s from SE Asia. We import Ford V6s for Explorers from Germany and their transmissions from France. This reduces the number of jobs, here, for making engines and transmissions--but increases the dollar total of imported goods. Other parts and pieces come from Brazil, Mexico and Canada.

    Now, how you'd keep track of the IT jobs which are moving to India and other places, I don't know. (A buddy of mine asked an 800-number lady where she was located, since he was intrigued by her accent. "Virgin Islands," she replied.) Yeah, IT jobs are being outsourced, but how do you figure an 800-call as an import or export?

    Sorry, but my imagination is limited enough that I just don't see any turnaround without our first changing from a spending society to a saving society; and then figuring out things to be made by the blue-collar workforce that we can sell, and work to be done by the white-collar workforce that leads to demands outside the country. Savings provide the capital for startups. New products can result in jobs and exports.

    'Rat
     
  5. zimv20 thread starter macrumors 601

    zimv20

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    i'd call that an export. 24/7 support was being exported throughout the 90s, as it made more sense to roll support around the world, as it were, so no one was working at 3 am. (i.e. if i called at 3 am, i'd get someone in, say, hong kong, for whom it was 3 pm)

    that makes perfect sense to me. cheaper to send trainers around the world than pay people 2nd and 3rd shift rates. along w/ cheaper labor, cheaper rents, etc.

    i agree that americans need to save more. imagine how many mortgage foreclosures there'll be once the economy tanks...
     
  6. Desertrat macrumors newbie

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    #6
    Datum: Mortgagees who are more than 30 days late are at an alltime record high.

    'Rat
     
  7. zimv20 thread starter macrumors 601

    zimv20

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    and Fannie Mae is in the midst of an accounting scandal (under-reported their debt, iirc), w/ concerns it could go under. that would be a bit of a catastrophe. i wonder what would happen to my mortgage.
     
  8. Ugg macrumors 68000

    Ugg

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    One more reason to reduce our oil dependence.

    It's interesting that France and Germany are the source for transmissions and engines. They are able to maintain a fairly high standard of living without huge deficits and trade imbalances.

    The US Virgin Islands wouldn't count of course but the British VI would :p Maybe it would count as an expense instead of an import/export but I would think that no matter the classification it would affect the trade balance because more dollars are going overseas than are being spent here.

    I don't think the US is going to turn into a nation of savers overnight. We never have been very good at playing tortoise, the hare has always appealed more.

    I agree that education is the key to our future success. We have always nurtured the best and the brightest and THEY are the key to our future. It was interesting that the two guys behind the robot construction worker were Iranian and Korean. This is not the time to close our doors.
     

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