U.S. Trade Deficit Plummets
By Justin Gardner | Related entries in Economy, Money, The WorldOne silver lining to the economic crisis? We’re exporting more and importing less.
February exports of $126.8 billion and imports of $152.7 billion resulted in a goods and services deficit of $26.0 billion, down from $36.2 billion in January, revised.February exports were $2.0 billion more than January exports of $124.7 billion. February imports were $8.2 billion less than January imports of $160.9 billion.
And here’s a handy dandy graph…
Of note, these numbers are the lowest since 1999.
(h/t: Calculated Risk)
This entry was posted on Thursday, April 9th, 2009 and is filed under Economy, Money, The World. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
April 9th, 2009 at 1:45 pm
Actually, if you bother to read the graph, it’s not actually true that we are exporting more and importing less.
Instead, we are exporting less, but importing at even more reduced rate.
IOW, we are selling way less of our own products overseas, and we importing way, way, way less stuff from overseas. Not a happy tale. A tale of overall shrinkage. Notice, for example, that if both numbers reach zero, the trade deficit will have completely vanished. :-)
April 9th, 2009 at 2:55 pm
Sorry, but the graph clearly states that we’re exporting more ($2 billion) and importing less ($8.2 billion) when looking at it from month to month. What you read was a comparison between this year and the same time last year.
So yes, I bothered to read the graph. :-)
April 9th, 2009 at 3:22 pm
Oops, my bad, I missed that little uptick at the end. All I noticed was the previous 7 months of tandem plummeting with a closing gap. The dominant trend looks like these 2 figures tend to run in parallel. If that keeps up, maybe we see an uptick in imports within the next month or two.
April 9th, 2009 at 4:13 pm
Justin–Before calling the shrinking trade deficit a “silver lining” perhaps you should go back and graph historical balance-of-trade trends versus GDP growth and unemployment. Start with, say, the 1920′s. I think you’re in for a very rude shock to your assumptions.
A trade deficit is no more (and no less) than a net INflow of foreign investment capital to a nation. And a trade surplus is a net OUTFLOW of domestic investment capital from a nation. Check out your new graph charting trade deficits/surpluses versus domestic economic conditions and then chew over the concept of “capital flight” before re-visiting the misbegotten public “wisdom” that trade deficits are always or even usually a bad thing.
April 9th, 2009 at 6:28 pm
Tully, I’ve seen graphs, numbers, etc. And we have the biggest trade deficit in the world because we consume more than we can genuinely afford. And that reality is hitting many Americans like a brick in the face right now. The era of easy credit is over, so expect the deficit to continue to drop.
Also, I know that trade deficits aren’t a bad thing because it helps our dollar, but I don’t think that’s a good long term strategy for growth. In other words, we can’t consume our way into prosperity on the back of endless, shuffling debt. I’m with Warren Buffet on this one.
April 10th, 2009 at 5:15 am
The drop in imports was led by a 16.3 percent decrease in imported crude oil ($10 billion), which fell to it’s lowest level since April 2004. If our economy was gaining in strength this number would have been significantly higher since US economic activity and petroleum usage are strongly related. In either case however, the graphs indicate a sickness in the US and global economy that we haven’t seen in decades.