The Matrix IV: Politics - There *is* no trade deficit....

[ChairOne]

Thank *god* the National Review is around to tell us these things!

"Perhaps more importantly, it has to be remembered that we ultimately exchange products for products. Notwithstanding the media hand-wringing about the “kindness of strangers,” no one in the real world is able to import something without exporting something first. In short, trade balances are logically illusory in that we only receive goods and services to the extent that we give something in return."

http://www.nationalreview.com/nrof_comment/tamny200501100823.asp

ROFL. There is no insurgency. There is no net job loss. There is no need for more troops. There is no trade deficit. There is no budget deficit.

Do these guys ever stop? Does 1/2 of America ever stop believing them? Answer the latter, and you'll thereby answer the former.

[rkc3]

1. I'll use that logic the next time I'm late with my credit card payment.

Citibank should be more than willing to forgive me of my debt.

[mattclearing]

2. They make things cheaply and we buy them. Mutual benefit.

"Stephen Roach regularly frets about the yuan’s “cheap” relationship to the dollar (and the trade deficit that supposedly results), but in doing so he chooses to ignore the reality that since China fixed its currency to the dollar in 1994, total trade between the two countries has risen exponentially; from $10 billion in 1992 to $191 billion in 2003. If trade is indeed an exchange of wealth, then the U.S. and China have for the last ten years been engaged in a mutually beneficial economic relationship in which each country has offered what it does best in return for what the other does best."

The question is, are we creating anything useful with all those inexpensive Chinese goods?

[trekbiker]

3. we do give them something in return...

little pieces of green paper called dollars... are they backed by something real like Gold??? HEll NO...

the neocons dont seem to be very scared of our impossible national debt which makes me nervous.. what are they planning?? destruction of the US dollar to get out of it?? that's how 1920's Germany got out of thier WWI debt. they destroyed their currency. Could it happen to us??