02-03-2007, 11:22 PM
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Loungin' Around
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Join Date: Nov 2002
Location: West Coast
Posts: 30,587
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Quote:
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Originally Posted by jseal
wyndhy,
Well, as the U.S. balance of payments for trade in Goods and Services has been in deficit for 35 of the last 36 years, I’d suspect that if there was some essential suckiness in running a trade deficit, said suckiness would have shown up by now. |
What's really alarming is how out of whack our Current Account is getting on a quarterly basis (and yes, I know we had a slightly less negative uptick in 4Q06 but not enough). After rough parity in 1991, it's been delining (and generally more rapidly over the years). One chief culprit is the real savings rate, which has been negative in the US for some time. We're using foreign money to fund our shopping sprees. 
High current account deficits = currency devaluation = lower purchasing power for people who already lack savings. Which equals something close to sucking in my book. 
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