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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: Big Bucks who wrote (10268)	6/8/2004 12:53:46 PM
From: Ira Player	Read Replies (2) \| Respond to of 25522

The basic, critical piece of information is WHAT is being imported and exported. Even if the balance of trade is exactly even: 1. If exports are raw materials and imports are finished goods...you are, in effect, eating your seed corn... 2. If imports are raw materials and exports are finished goods...you are creating value by the manufacturing process. The first example is like a colony. The second is a developed country. The US started as 1, developed itself into the worlds strongest 2 and is now teetering between 1 and 2... We import too much finished goods like Auto's, DVD Players, etc. and even borrow via a trade deficit to pay for it. If we had a trade deficit and were importing mostly raw materials, it wouldn't be an issue because the 'value added' by labor is in the US. That was the conditions before the late 60's. That's the problem and the primary difference between the first few decades of trade deficits and the last few. All IMHO, of course. Ira