US Trade Deals & Foreign Trade Agreements Have a Large Impact on the US Economy

1. US Trade Deals & Foreign Trade Agreements Have a Large Impact on the US Economy importkey.onesmablog.com/US-Trade-Deals-Foreign-Trade-Agreements-Have-a-Large-Impact-on-the-US- Economy-38962701 The US trade data is the difference between actual export quantities and imports. When a country sells more than it imports, that country has a surplus. That means for every dollar of imported goods, one dollar is spent on imported goods. When a country exports less than it imports, that country has a deficit. When the value of the currency of the exporting country falls, then the value of the currency of the importing country rises. There are many reasons why there is so much US trade data that is both imported and exported each year. Some of those are very difficult to figure out because they are based on very small details. For instance, you might be surprised to learn that the number of passenger planes that are scheduled to fly out of New York City is almost exactly the same month after month. If you had any doubt as to why this happens, then you should know that there is a very good reason. Major factors playing their role in the US trade deficit 1/2

2. A major part of the US trade deficit is caused by our government's failures to negotiate a truly open market for goods and services. Since we are still tied to a fixed exchange rate to the dollar, any time the price of one country rises while the price of another decreases, the US trade data deficit grows. The United States is one of the few industrial nations that relies on a largely closed economy to support its trade. It is not easy for an isolated nation with a weak economy to rely on the US for its global trade. For that reason, many nations look to other countries to fill in the gap that leaves the US with an imported goods deficit. Sometimes, other countries will ship us their raw materials at cheaper prices since they cannot match the price offered to them by US producers. In turn, those other nations start buying US exports because they fear that the US might start charging tariffs or other types of trade embargoes if they try to increase their own imports. When this happens, the US trade deficit grows significantly. How one gets the idea of the national economy? But US trade data doesn't always reflect the full picture of the state of the national economy. Many economic measurements including gross domestic product, inflation, unemployment, business sector health, and other indicators are incomplete because they are based on aggregate data. When you look closely at the picture of the country as a whole, you'll see clear signs of slackening. For instance, many economists believe that the low interest rates of the past few years were a one-time event driven by unusually poor growth in the residential sector. Since the residential sector accounts for about two-thirds of overall US exports, any decrease in its prices would have had a significant impact on US exports. Another example is when you examine the relationship between the value of imports and exports. If imports are increasing, so too are the exports (goods and services more specifically). Similarly, if imports are decreasing, then exports will be falling. One can easily see how the changes in the balance of trade will have a significant effect on the domestic balance sheet (as exports are always more volatile than imports). The above two examples are just the tip of the iceberg when it comes to the impact of free trade agreements on the US economy. And remember, this is just one small part of the puzzle. There are a multitude of issues that are interwoven together when thinking about the global macro economics. The best way to think about all of this is to access our site below for in-depth, comprehensive analysis of all of the various aspects of US trade and foreign trade agreements. One can easily access the US trade data by contacting online firms like importkey.com. 2/2