The International Trade in Goods and Services report shows the trade deficit widened to $47.6 billion in April from $45.3 billion in March.
The April deficit was greater than any Econoday economist’s prediction.
In addition, the Census Department revised the March deficit from $43.7 billion from $45.3 billion.
The bad news is accelerating for the second quarter. The trade deficit widened in April to $47.6 billion from a revised $45.3 billion in March. This opens the quarter on yet another defensive front.
Exports fell 0.3 percent in April to $191.0 billion as a fractional rise in service exports to $64.0 billion could not outmatch a 0.4 percent decline in goods exports to $126.9 billion.
Imports meanwhile jumped 0.8 percent to $238.6 billion with increasing pressure centered in goods but also including services.
The best positive in the details is a rise in aircraft exports and the worst negative is yet another jump in consumer goods imports, up $2.0 billion in the month to $51.0 billion. Country data show a sharp widening with China, to a $27.6 billion total gap in the month, with the EU gap also up sharply to $14.6 billion.
The conclusion? U.S. demand for foreign products is strong and foreign demand for U.S. products is not.
Trade in Goods and Services
Trade in Goods and Services Moving Average
Trump Will Howl
- In September 2016 exports were $188.123 billion.
- In April 2017 exports were $190.975 billion.
- In September 2016, imports were $226.588 billion
- In April 2016, imports were $238.592 billion.
- Imports increased $12.034 billion.
- Exports increased $2.852 billion.
With imports up significantly and exports barely budging for seven months, expect another round of Trump howls over the trade deficit.
This report will also take a couple of ticks off second-quarter GDP estimates.
Mike “Mish” Shedlock
Audit the Fed, then End the Fed. Then back the dollar and all other currency’s with Gold. This will level the playing field. And stop all wars too.
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What happens when out exports continue to be less than our imports and we run out of gold?
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As we run out of gold someone gets a lot of gold.
Which will make our prices fall dramatically in terms of widgets/gold unit. As everyone else gains in gold as we lose it — our prices will seem more attractive.
Subsequently, our exports will increase to balance this out and we our quantity of gold comes back into balance.
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The gold is gone.
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Also the M1 currently stands at $3,600B, but we only have about $360B in gold – do we just inflate the price of gold by 10 to match the M1 – and what about the M2, etc.?
I really don’t understand how we could go back on the gold standard.
Also, what happens if our economy grows faster than our gold reserves – especially as we only have just over 7 months of gold reserves to pay our trade imbalance ($360B / $45.9B). With no gold, we have no money. Obviously the economy would crash before that would happen.
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I imagine this has been addressed in the various discussions around returning to a gold standard. Have you looked at any?
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Pegging gold to match instant M1 is a straight forward way of doing it. Probably the simplest way. Pegging the dollar at about $20/ounce of gold, as the Founders intended, could be done as well, but dealing with cash would require some cleverness, or at least resolve. Non cash debt and contracts, would simply blow up and be renegotiated, as noone in their right mind would bother honoring a contract entered into in fiat US or Zimbabwe dollars, in dollars now at $20/ounce.
The gains from getting away from the undifferentiated theft racket that is debasement, would so completely trump all possible short term dislocations, that it really doesn’t much matter what the peg would be.
“The economy” growing faster than gold reserves, simply means the cost of producing other stuff, is declining faster than the cost of producing additional gold. Which will simply result in their relative prices changing.
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“Then back the dollar and all other currency’s with Gold. This will level the playing field.”
1. How do you force the government to keep the peg? It has never worked in the past.
2. How does gold get us to a level playing field? Nobody else’s currency is backed by gold.
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“Imports meanwhile jumped 0.8 percent to $238.6 billion with increasing pressure centered in goods but also including services.”
….
Crude often the whipping boy, but for April it actually dropped $2 billion.
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Our International bully is making things worst! Isolation = depression.
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Come on, dude. You need to join the cult members here who praise Allah, I mean Trump, every day. He is our Messiah. He will deliver us from evil. We believe in Him.
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There are a number of scenes in the “Back to the Future” movie franchise where Biff (the antagonist) calls Marty (the protagonist) a chicken or “yellow” (as in coward). Marty, while normally an intelligent and rational person, instantly gets enraged and turns off his brain — doing some incredibly stupid things as a result. Even when other characters point out the trigger word to him, he still flies off the handle.
Its the same way when you mention climate change to liberals. The “Paris Climate Deal” is about sending US jobs abroad, its not really about the climate at all. But call a liberal chicken, or mention the trigger word “climate” (actually anything not politically correct) — and otherwise intelligent people turn their brains off.
We hear about Al Gore and Leonardo DiCaprio flying around the world in private jets and armored limos (both of which burn a LOT of fuel) — but they use the word “climate” in the title of their talk and rational thought goes out the window.
Congress never ratified Obama’s Paris accord, not even his fellow democrats wanted it — because its about jobs, not the environment, and even democrat congress members understand “its the economy stupid”. But the media weenies looked at the Paris Kill US jobs accord, and saw the trigger word, and they can’t think straight.
Its really overdue for voters in the USA to read past the headline of a story. Yes, the globalists included the trigger word “climate” to throw you off your game — but that is no excuse. Ask yourself if you would vote yourself out of a job if the trigger word wasn’t in the headline…
Thank God Trump isn’t as easy to manipulate as the average TV “news” viewer.
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Wait until his little Mar-A-Lago is under water in a few years. Of course Trump is in his 70s so I am sure he will be dead by then.
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In a few years?
The climate scientists who support your political opinion on global warming say sea levels may rise 2-3 inches over the next 100 years. It “MAY” rise — as in the scientists are uncertain — because climate models have proven to be even less reliable than economic models. Anyone who has ever checked a weather forecast knows that.
You are so hyped up on politics that you actually wrote a comment that contradicts even the scientists who think global warming is an issue.
That is why most voters (I said VOTERS, not media pundits) think you are insane.
Stop crying wolf. Even if the science was more certain, your alarmist hype is just stupid
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Sea levels have already risen 8 inches since the industrial revolution and are doing so at an accelerated pace. The vast majority of scientists who support his “opinion” project sea levels to rise another 8 inches with 90% certainty on the low end, 1 meter on the high end by 2100. 2-3 inches is farcical. Yes a few years was rather silly, but the side you are presenting is as well.
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Our trade deficit should be plummeting because of reduction in oil imports. I’d love to see the change since 2007 between oil imports versus other goods & services.
Of grave concern should be the growth in imported services.
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Nostradamus Quatrain Century II, verse 41
41
The great star will burn for seven days,
The cloud will cause two suns to appear:
The big mastiff will howl all night
When the great pontiff will change country.
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Obama talked about reducing the trade deficit by exporting more, as many of us expected that did not happen. The trade deficit is a major problem. The idea that inflation cannot exist in a period of slow growth is a myth that many people believe, this may soon be proven false. The concept a little inflation is a good thing appears to be based on the idea it adds to the illusion of overall economic growth.
The world central banks have created an environment where stagflation may flourish. When it comes to economic policy it seems, sustainability has been put on the back burner and the goal of creating growth at any cost has taken center stage. For more on this subject see the article below.
http://brucewilds.blogspot.com/2017/05/stagflation-most-probable-scenario.html
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