Why does it matter if the US has trade deficits anyway? Fighting for fair trading rules I get, and support. But the simplistic focus on trade deficits as a sign of winning or losing is dumb.
As the US dollar is the global reserve currency and primary tool for global transactions, that means many other countries rely on holding dollar reserves, creating massive demand for U.S. financial assets. This means that the U.S. pays little for its foreign borrowing, allowing it to finance its high consumption at low cost, which boosts global demand. In 2017, Americans bought about US$552 billion more goods and services from abroad than foreigners purchased from the U.S. But foreigners sent about that amount back to the U.S. to help American businesses build factories, create jobs and increase growth.
For the US, having trade deficits doesn't mean they're losing. If US consumers are buying then the US is winning. If the focus on trade surpluses means the US consumer economy stalls as US consumers stop buying, then they really will start losing.
- Forums
- World Politics
- Trump has misread China
Trump has misread China, page-89
-
- There are more pages in this discussion • 28 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)
Featured News
Featured News
The Watchlist
CCO
THE CALMER CO INTERNATIONAL LIMITED
Anthony Noble, MD & CEO
Anthony Noble
MD & CEO
Previous Video
Next Video
SPONSORED BY The Market Online