It got somewhat lost in the hoopla of the jobs report and the blistering rally in the stock market on Friday. But the US trade deficit worsened by 3.4% in October to $43.9 billion, according to the Commerce Department, once again disappointing soothsayers who’d hoped for an improvement in the trade deficit.
But as bad as the overall trade deficit is, the trade deficit in goods (without services) is much worse, and even then, the oil trade covers up just how terrible the underlying trade of non-petroleum goods really is, how far and how fast non-petroleum exports have plunged, and how much US manufacturing is getting whacked.
The worsening trade deficit was a nasty “surprise” – nasty because it dings US economic growth; and surprise because it appears inexplicably difficult for Wall Street economists to predict a downhill slope.
Exports add to GDP, and imports reduce GDP. So when imports exceed exports, the sacred US GDP figures get hit as they have been since the 1990s. But October was bad: exports of goods plunged 10.4% year-over-year to $123.8 billion, the worst level since June 2011.
http://www.nakedcapitalism.com/2015/12/wolf-richter-us-exports-manufacturing-debacle-covered-up-by-oil.html
But as bad as the overall trade deficit is, the trade deficit in goods (without services) is much worse, and even then, the oil trade covers up just how terrible the underlying trade of non-petroleum goods really is, how far and how fast non-petroleum exports have plunged, and how much US manufacturing is getting whacked.
The worsening trade deficit was a nasty “surprise” – nasty because it dings US economic growth; and surprise because it appears inexplicably difficult for Wall Street economists to predict a downhill slope.
Exports add to GDP, and imports reduce GDP. So when imports exceed exports, the sacred US GDP figures get hit as they have been since the 1990s. But October was bad: exports of goods plunged 10.4% year-over-year to $123.8 billion, the worst level since June 2011.
http://www.nakedcapitalism.com/2015/12/wolf-richter-us-exports-manufacturing-debacle-covered-up-by-oil.html
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