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Vicente
2009 Oct 9, 3:59am
Michaelsch,
I assume there is some Federal agency report somewhere which shows all our exports and how it breaks down but haven't found a good document yet.
Just look at the way they report our trade deficit:
Here, for example:
http://news.bbc.co.uk/2/hi/business/8299682.stm
"Weak dollar improves US trade gap
Exports rose slightly on the back of the weak dollar while imports fell.
The dollar has slipped recently, with traders moving into other currencies as the global economy begins to recover.
Imports in August totalled $158.9bn, compared with $159.8bn in July. Exports totalled $128.2bn, compared with $128bn in July.
The slight fall in imports reflects a small reduction in demand for goods among US consumers. "
Looks good, right? Yea, but let's take a look at the details:
Here, for example: http://www.bloomberg.com/apps/news?pid=20601087&sid=aC.PdDWZb4JI
"Exports increased to $128.2 billion, led by a $496 million gain in sales of cars and parts, today’s report showed. Exports to Canada reached the highest level since November, in part reflecting the cross-border trade in autos. "
In other words, we moved more cars and parts between US and Canada, thus increasing both export and import.
OK, you would say, but that means that not counting this we would get to even lower imports.
However, "Imports fell 0.6 percent to $158.9 billion in August after jumping the prior month by the most in 16 years." This seams more like monthly fluctuation, than a real decrease. Indeed, import fell because we have imported much less oil in August than in July. But oil imports always peak in July and sharply fall starting mid-August. Right, this year it happened a bit earlier, btw it is not a sign of a good economy.
And here we are: "Excluding petroleum, the trade deficit widened to $14.2 billion from $14 billion the prior month. "
My conclusion: we had visibly lower imports, due to early seasonal fall in oil imports NOT related to weak dollar.
Of course markets keep going up on the "good news".
The following looks rather like a joke: "More than $2 trillion in government stimulus programs are reviving demand from Asia to Europe, ensuring American factories benefit from growing sales overseas as the dollar weakens."
So you need to spend $2 trillion a year to achieve what? Monthly increase in exports of about $0 billion. It would be funny, wouldn't it be so sad.
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I wonder why they do not fall.
There is a huge wave of NODs especially in CA issued at the end of September.
Bankruptcies rise every day, they are probably at the all time high now and keep rising.
Yet the stocks are certainly overbought and do not fall.
What's up?
I can think about two explanations:
1. Lots of investors think that delays of foreclosures and of bankruptcies of insolvent companies may indeed fix the economy. Is it possible that most of people with money think so?
2. They consider stocks as a hedge against future inflation and falling dollar. Again hard to believe, there are much better hedges. But may be all those with savings like 401k have no access to better hedges.
Do I miss something?
#housing