MAGA?

US exports increased 14.4 percent from YTD April 2016 to YTD April 2018, from $725.8 billion to $830.5 billion.

US imports increased 16.5 percent from YTD April 2016 to YTD April 2018, from $886.2 billion to $1,032.3 billion.

Here is the source, via James Hohman.  You don’t have to credit Trump with much if any of that, the broader point is that, as I argued yesterday, the age of trade is hardly over.

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Caculated Risk does a fine job presenting this information every month - http://www.calculatedriskblog.com/2018/06/trade-deficit-decreased-to-462-billion.html

What is a nice feature is how he breaks out the petroleum imports - which remain around an 1/8 or so of the American trade deficit for the last few months. As the price of crude goes up thanks to the Trump Administration's brilliant strategy to increase the value of oil exports from Iran and Russia, that number will likely increase (though also likely counterbalanced to an extent by the fact the higher the price of crude, the more incentive there is for domestic fracking production).

What is really amusing is not pointing out how the American trade deficit has increased under the Trump Administration, in part because of its seeming desire to maintain a strong dollar. A cynical person might point out that a significantly weaker dollar makes crude imports more expensive, which translates to political pain at the gas pump, particularly after the U.S. was able to increase crude prices notably by unilaterally pulling out of the Iran agreement.

So we all play a game that Trump somehow isn't the cause of the greatly improved economy. It is interesting to watch. What will we dismiss or ignore next to keep this myth alive that Trump isn't the most significant president since George Washington and the most significant world politician in history. Like it or not Trump is a game changer.

Calling Poe's Law (Trump version) on this one.

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Strawman created, strawman destroyed.

Those numbers look misleading. The annual numbers are around $2.4 T (exports) and $2.9 T (imports) for 2017. Why pick four months in 2016 and compare them with four months in 2018?

It's level-and-trend analysis.

"Why pick four months in 2016 and compare them with four months in 2018?"

?They don't like quarters (three months reporting periods)?

They don't like year-on-year analyses? Two-year fiscal periods' results are better for advancing the narrative??

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There seems to be a lot of ideas in global trade that get mashed together, but accredited economists are all but PC-ed into being "for free trade" instead of lifting up the blanket and viewing what is going on underneath.

For example, let's take the site location of large industrial plants.

Some say Nixon and then Reagan “bullied” Japanese and German automakers to build plants in the US. This is bad.

But we don’t know the other side of the coin: Were Germany and Japan “bullying” automakers to NOT build offshore plants?

In global trade, there is always a welter of laws, taxes, port restrictions, import-export financing, regulations, subsidies, and currency manipulation that make the ideal of “free trade” meaningless.

What has evolved is international trade as primarily managed by multi-nationals, Western importers, and mercantile nations.

Where large industrial plants are located is always a politico-economic decision.

I wonder why Foxconn wants to build a $10 billion plant in Wisconsin. We were told Americans don't want to do this kind of work; now Foxconn says it will hire 13,000 people in Wisconsin (!). It will be the first LCD manufacturing plant in North America. The Chinese Communist Party probably controls majority of seats on the Foxconn board (they usually do in large corporations), and has internal CCP committees inside Foxconn, so we may assume Foxconn has permission of the CCP to open the plant.

If Trump played a role in this, I think Trump has done well.

Property prices tend to explode in nations with large current account trade deficits. Wages stagnate.

America’s elite has embraced the view that large and chronic current account trade deficits are actually a positive.

When the US borrows money to finance imports and sells assets or goes into debt, then certain classes make money on enabling transactions, and selling assets.

The employee class does rather less well, and in fact real wages have dead since the 1970s, and Tyler Cowen has posted the young men make less today than in the 1960s.

The globalists have been a little glib on the benefits of "free trade." It is not a black and white issue.

What if Foxconn intends to make the Xi-phone at the Wisconsin plant rather than the i-phone? It's China's goal to be the producer of all goods and services, for its products to be the first choice among consumers. That means a new phase for trade, one in which China makes China goods for China firms, not foreign firms such as Apple, to compete with goods made for (example) U.S. firms (including goods made for U.S. firms in China!). Is the Xi-phone a China phone or a U.S. phone if its made in Wisconsin? Is the i-phone a U.S. phone or a China phone if its made in China? [Xi is an allusion to president Xi Jinping.]

Rayward: You are correct in defining large-scale industrial location as a politico-economic issue, and possibly of national industrial policy (in the case of China).

If China chooses to build Xi-phones in the US, and hires workers to do so, then employees in the US may do better by Xi than Apple. Perhaps I will buy Xi-phones as a point of honor.

BTW, Foxconn is bragging they will pay $50k average salary in Wisconsin, which is a good wage given living costs there.

If Foxconn pulls this off, it will raise lots of questions....

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Which are you saying that, you are happy China will run a loss in middle America, or that America has no domestic company to make this sort of thing fly?

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Foxconn is Taiwanese. The CCP does not control it. Having foreign-based factories in the USA is a pretty good hedge in case their foreign-based factories in China run into political problems...

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Cowen's point is that continued growth in international trade is ineluctable. That being true, isn't it counter-productive to alienate our best trading partners? What's convenient about the past is that we have a historical record of it; what's convenient about the future, is that we don't so anyone can create her own record of it. It's the work of economists to distill the historical record in order to provide an accurate forecast of the future. Alas, today's soothsayers are no more accurate than soothsayers of the past: economists no less than mere mortals see what they want to see. To his credit, Cowen rarely if ever plays the part of the soothsayer. In this blog post as with many others Cowen observes trends, ineluctable trends. Sure, there may be short-term ups and downs in the data for international trade, but behold, the future is more globalization. It's a law of nature that water will seek its own level; and its a law of human nature that owners of capital will seek the highest rate of return. Unless and until the rate of return is flat across countries, which is nigh impossible, international trade will continue to grow.

But the point he makes in the Bloomberg column is an important one: that there is a public good in the common spaces allowed by internet based platforms and these are a key component for cross-country interactions. If this common space doesn't develop some norms for open, trusted and reliable material; if it is hijacked by pirates after monetary extractions; hijacked by influencers more worried about persuasion than interested in the advancement of the group; hijacked by thugs who find fulfillment in deviancy- then globalization will be greatly impeded.

Cowen's confidence in tech is much higher than mine. One might consider the irony of a blog dedicated to micro becoming so influenced by the possibility of macro. But I digress. And I will digress a little more. In the ultimate irony, Catholicism has become today's Judaism. What? Well, Judaism is all about rules of good behavior, Jewish Law as it's known. Catholicism is what's left to good behavior among Christians, the Catholic canon law contrasting (sharply) with the lawless evangelical Christianity (faith in Jesus is all that matters). What? The most business-friendly member of Trump's cabinet is an evangelical Christian, Scott Pruitt. Is he actually business-friendly? Indeed, is he even Jesus-friendly?

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Just a generic question about twitter and the comment section - are hash tags not allowed?

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Trump's explicit goal is to lower barriers to trade for American firms. I can't see people are so quick to think the result will be the opposite. The US is in a great position to negotiate so why shouldn't he be able to get that done?

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'Trump's explicit goal is to lower barriers to trade for American firms.'

And the result of how he has tried to implement this goal is a likely increase in barriers to trade, according to WTO rules, against American firms.

'I can't see people are so quick to think the result will be the opposite.'

Because they are aware of the opening moves of a trade war include the use of increasing barriers to trade according to WTO rules?

'The US is in a great position to negotiate so why shouldn't he be able to get that done?'

If the U.S. does not follow a WTO ruling against it, then the WTO system may suffer notable damage. Why this would improve America's negotiating position is difficult to fathom.

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"Look on the bright side" can be contrarian without being especially useful.

https://twitter.com/adamdavidson/status/1005436808182816771?s=19

Gawd, the world is in so much trouble.

https://twitter.com/corinne_perkins/status/1005236740360110081?s=19

I should be clear that I think Macron and Trump are both a couple idiots to play this game. But you know, that our idiot says he's going to meet Kim Jung Un with no preparation .. is worrying. What happens if he breaks the little guy's fingers?

On the Korea thing.

https://twitter.com/juliamacfarlane/status/1005459729253052416?s=19

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@First twitter link.

He not wrong about the low info voters, but uncovering dirt is important. How much underhanded and illegal activity would have gone unreported if Hillary had won? There's still years of this stuff to uncover.

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Overall national import/export analyses are only of supposed value to national government central planners. Private businesses need only be concerned with the narrow specifics of their particular product/service market.

Government central planners have the impossible task of analyzing/predicting/controlling intricately complex dynamic markets -- but the job pays well, has very comfortable working conditions, and no personal accountability... ideal job for professional economists.

Trump likes Putin and thinks Russia should be in the G7 because Trump is a Soviet style central planner. Frustrated by the opposition to his efforts to dictate every aspect of the US economy.

Trump wants you to heat your house with coal. Wants you and your kids to work in the sun tending plants. For rich immigrant oligarchs who golf at Trump resorts.

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Trade deficits don't matter. Trump said they do. Trade deficit is bigger.

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If you look at real imports and exports ( 2012 $ ) they are right on the trend line since 2013 of 1.7% export growth and 3.5 % import growth.

As with virtually all the economic data for 2017 and 2018, it shows the trends established during the last few years of the of the Obama administration are continuing with Trump having essentially no impact.

For example, from 2011 to 2016 the monthly change in employment averaged 205,000 and in 2017-18 it has average 185,000.

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The Trump Administration's expedited review and permitting process for liquified natural gas exports allowed those exports to quadruple in 2017, which accounted for much of the total US increase in exports. So, yes, you do have to give credit to President Trump. The sad fact is that most countries in the world do not share President Trumps commitment to free trade and have fecklessly and with impunity prevented other US goods and services from entering their markets. This must end. The US needs to have actual wealth producing industries to support the lard-barrel non-profit sector with which we are saddled.

What we should have done, is use that natural gas to make electricity, and close all coal plants.

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I guess I should have included the appropriate link. Remember Trump is exporting that natural gas while trying to prop up non-economic domestic coal.

https://www.marketwatch.com/story/trumps-inept-industrial-policy-will-flop-2018-06-07

If by "trying to prop up" you mean "ending the war on" then you are correct, President Trump, with the assistance of green eco-hysterics in Europe, successfully increased US coal exports in 2017 by 61%. All those uneconomic hectares of solar panel covered countryside and bird-killing windmills assures the US that its best overseas market for coal exports continues to be Europe.

Source: https://www.eia.gov/todayinenergy/detail.php?id=35852

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Note for the future, "bird killing" is a flag for innumeracy.

Wind turbines kill between 214,000 and 368,000 birds annually — a small fraction compared with the estimated 6.8 million fatalities from collisions with cell and radio towers and the 1.4 billion to 3.7 billion deaths from cats, according to the peer-reviewed study by two federal scientists

Lack of statistical context is a red flag for innumeracy.

How many cell and radio towers are there compared with wind turbines?

And once you’ve calculated the kill ratio, what is the cost/benefit per bird kill?

Remove a wind turbine and no one would notice. Remove a cell tower and see how things work out.

I will assign partial credit.

Double the number of wind turbines, and how will they compare to pet cats?

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What area did those studies cover? Spain alone kills over 6 million a year: http://savetheeaglesinternational.org/new/us-windfarms-kill-10-20-times-more-than-previously-thought.html

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So, Trump is responsible for LNG exports doubling in 2016?

Next thing you'll claim is Trump is responsible for US oil production doubling between 2008 and 2014, reversing the decline since 1970 under Republican administrations.

While I hear talk of US production rising, Trump wants it done his way, on Federal leases which means by big oil which shares common cause with the Saudi dictators who want scarce capital to maximize rent extraction. In other words, Trump as central planner wants demand for oil to rise faster than supply by restricting building capital. Making sure Wall Street knows the Federal government is picking winners makes the money stop flowing to upstarts. When Wall Street was sure Obama was making Federal placeholders and dictators with oil the losers, they poured money into upstarts working private, non-Federal land, frantically building capital. From 2008 to 2014 oil and gas capital doubled in the US, and by 2015 it suddenly became relatively abundant.

When capital is abundant, prices fall rapidly.

Trump is, with his followers, seeking to limit capital to drive up prices. Can't increase the amount of coal, but he can try to limit the capital harvesting the sun and sun driven wind.

The thing is, making solar and wind capital abundant pays millions of workers. Making energy capital scarce kills jobs.

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https://www.eia.gov/todayinenergy/detail.php?id=35512

I don't see anything about 'expedited permitting' accounting for the increase in natural gas exports.

In fact looking at https://www.eia.gov/todayinenergy/detail.php?id=34032 it looks like the actual capacity for added LNG exports was mostly being built up during the Obama period. If anything the addition of capacity seems to be slowing down under Trump.

Once again the best one can say about Trump here is he has not *yet* spoiled the Obama boom he inherited from a better administration.

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here is another reason why America is better than brazil
its Jodie foster in the movie hotel actemes
https://www.youtube.com/watch?v=S4ExcW_ia0Q

another movie the movie critic/memezombie rex reed
did not understand just like he didn't understandthe movie
a perfect day with senor Humberto del Torrez
rex reed does not understand senora Jodie foster.
The middleclass we understand senora Jodie foster
is getting at

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I just dipped into the news of the day, and I would say the wheels are off the cart at this point.

The US has an average tariff of 1.6%

Canada? 0.8%

But we are blowing up the G8 because Canada is unfair. And they should love the Russians, who are up in your home/office router, more.

https://twitter.com/JustinWolfers/status/1005477243437580288?s=19

G7

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G6, do I hear a bid for G6?

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How much of this is Lockheed/Boeing/MIC weapons deals? Quasi-trade accounting.

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