-Export: In 2011, the U.S. exported $94 billion in goods
-Import: $367 billion
$295.5 billion dollar difference
-1.2 trillion in bills and bonds, and that’s only 8% of total debt
Not that big of a problem:
Deficit: corrects over time, large amount of us dollar being held by foreign nations. Economists worry mainly because these nations may decide to sell at any time.
-This is not a problem however because since we are giving China so much money by buying their goods, China will continue to invest into the US Economy so that we continue to buy their goods. Worst case would be that China begins to invest less into the US Economy because we are not buying as many of their goods, however that would mean that the trade deficit would diminish.
-more purchasing power because cheap products
-can’t just look at china, but rather entire deficit, such a small factor
-no possible way to have an even trade with any other nation, always will be disproportional
-There is no ...view middle of the document...
1. From Microsoft and Motorola to Wal-Mart and KFC, there are a number of American and multinational companies that operate in China and are more successful because of it. (And while these companies benefit from manufacturing in China for export elsewhere, they also benefit from selling to China’s consumer market.)
2. Because trade makes the people in China more prosperous, they purchase more – and they purchase, in part, what U.S. companies make.
3. “Made in China” products are often less expensive than products manufactured elsewhere – allowing consumers in America access to less expensive goods, from sweaters to computers.
4.While economic integration may lead to job losses in the short-term, in the long run a greater number of higher-quality jobs are created as a result of integration than are lost.
-Elsewhere in the economy, other jobs have been created because of Chinese competition. Because American consumers have saved at places like Wal-Mart buying Chinese goods, they've got more money in their pocket to buy something else, which creates business opportunities for those other business, which means they hire workers they would not have hired, otherwise.
-The U.S. can afford high trade deficits with countries like China because China and other countries from which we buy consumer goods turn around and invest roughly $500 billion a year of their capital in the U.S. economy
-Bilateral trade deficits don’t matter at all -- except politically. It's an eyesore, politically, that we sell less to China than we buy. And it drives up protectionist pressures, so in that sense it's something to be concerned about. But as far as economic fundamentals, the fact that we run a trade deficit with China doesn't particularly matter. What matters is our overall trade balance.