US trade deficit breaks new high in 2006

[deadparrot]

WASHINGTON (AFP) - Sky-high oil prices and Americans' insatiable hunger for Chinese goods drove the US trade deficit to a record high of 763.6 billion dollars in 2006, the government said.

The Commerce Department said the December gap alone was 61.2 billion dollars, up from 58.1 billion in November. It was the highest monthly total since September's 64.4 billion.

"The larger-than-expected deficit implies some further downward revision to the fourth-quarter GDP (gross domestic product) growth," Nomura US chief economist David Resler said.

The government estimates that US growth over October-December stood at 3.5 percent.

http://news.yahoo.com/s/afp/20070213/pl_afp/useconomytrade_070213162046

[AndyA]

1. I think this is so sad.

Someday hopefully we can have a government who will work for us instead of against us. Create good paying jobs with benefits here, instead of overseas. Encourage American business to open new facilities here and create new jobs here instead of overseas.

Hey, here's a concept: why not create incentives for overseas companies to operate here, and create jobs here?

I'm so tired of seeing everything go overseas, and it would sure be nice to have a government that was of the people, and for the people for a change.

[Supersedeas]

10. It takes capital and the marketeers are sending capital elsewhere

[no_hypocrisy]

2. Americans' insatiable hunger for Chinese goods wouldn't have

been a problem had factories remained in this country. The trouble is I'm not certain whether this situation wouldn't have been inevitable, although it started as a way to boost companies' assets and stock value.

[primavera]

5. Sure it would

Factories in China, subsidized by government, built on land that costs the factory next to nothing, using workers paid slave wages, operating without any sort of labor or environmental protection laws, will always be able to produce goods cheaper than any factory in the US can produce them. The problem is that American consumers never stop to ask themselves how it is that WalMart is able to sell a pair of jeans for $5. As long as there's a bargain in it for us, we turn a blind eye and see no evil, stop our ears and hear no evil.

[Idioteque]

3. I don't get the fixation on the trade deficit...

We send them paper, they send us stuff. Seems like a good deal.

In return, they use our dollars to invest in the United States. A trade deficit is just another word for a positive capital inflow.

[primavera]

4. Um, actually, no.

They don't necessarily use the "paper" we send them to invest in the US. That "paper" represents assets going out of the US to enrich other countries. If the flow of wealth coming in meets or exceeds the outflow of capital, no problem, but this isn't some situation where you get to keep charging purchases to a credit card and never have to pay it back.

[brentspeak]

6. "Invest" in the United States? They own the debt of the United States.

We send them our jobs; they send us badly-made crap. That's a bad deal for the average American.

[melm00se]

7. I have (and have had) an ongoing

trade deficit for years with the corner grocer. is that bad too?

[fasttense]

8. Yeah, especially if they say you have to sell them your house

if you want to continue buying food. See the counterfeit money you have been printing in your basement has turned out to be worthless, and they want real assets instead of paper.

[Doondoo]

9. K&R