WSJ Defict News?
Posted by bcooney on November 9, 2006
NEWS ALERT
from The Wall Street Journal
Nov. 9, 2006
The Commerce Department reported the U.S. trade deficit narrowed by 6.8% to $64.3 billion in September from a record high in August. Imports fell for the first time since February amid falling oil prices. Exports rose slightly.
The deficit with China rose to a record of $23 billion, pushed higher by a flood of Chinese-made televisions, cell phones and toys being imported to stock American store shelves for Christmas.
For more information: http://online.wsj.com/home/us?mod=djemalert
So what is happening. The trade gap with China widened but the deficit of trade overall decreased. Where is the influx reducing the overall deficit?
Is China really the threat that the US thinks it is? I heard today that China’s economy has a chance to overtake the US economy… in 2040, but how accurate are indicators 30 years from now?
China still faces a major test. The government still faces major shifting if China really emerges as the economic player. The politics of globalization is probably the most lagging indicator of change since it takes years if not decades for a major change to take place. I don’t think China will maintain its current growth levels. It will slow down at some point, but with the current speed of globalization, China’s supply of laborers may lose their jobs from other countries ready to pick up the slack in China. If a political change allows for job loss in China, tension among a newly formed non-communist working class could create havoc.
