Economics: US trade deficit: Is it real?
The tutor probes more deeply into the concept of the US trade deficit.
In my January 1 post I began about the US trade deficit, mentioning, for example, that it’s exceeded $500 billion per year over the last ten years. The numbers might sound menacing, but are they really?
Between 2003, and 2015, the net worth of US households rose from $60 trillion to $84.9 trillion (inflation adjusted). During that time, the US trade deficit summed to around $7.4 trillion. The US federal debt increased, during that interval, by about $11.2 trillion. Subtracting the outflows of $7.4 trillion and $11.2 trillion from the wealth increase of $24.9 trillion still shows net growth of $6.3 trillion.
The clear question: Is money really leaving the US, as many suggest, or is it actually accumulating in the US?
I’ll be following up:)
Source:
Jack of Oracle Tutoring by Jack and Diane, Campbell River, BC.
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