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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (156)	2/17/2004 9:50:26 PM
From: yard_man	Read Replies (1) \| Respond to of 116555

re imports and the trade balance: Does this make sense? If the buck falls, it buys less and if real imports (the same qty of stuff) stay the same -- imports increase in dollar terms. If imports remain about the same in nominal terms (as the dollar falls vs other currencies), then real imports are declining. (I think this happened in the report prior to the latest.) Now I haven't looked in detail at the most recent balance of trade numbers -- but if, while the numbers are being measured, crude is going up -- the dollar is falling and imports are up in nominal terms -- but only about as much as the decline in the dollar would imply -- ... crude is accounting for a larger slice than other goods, i.e. real imports, ex crude, are actually shrinking already. I think the point at which adjustment of the current acount deficit -- i.e. reduced imports here -- increases the value of the dollar is a long ways off. A couple of quarters of declining GDP won't do it. No trying to misconstrue Heinz here -- just saying it is a very long process most likely.