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To: long-gone who wrote (24042)	12/9/1998 3:15:00 PM
From: goldsnow	Read Replies (2) \| Respond to of 116762

Trade Deficit at Quarterly High Wednesday, 9 December 1998 W A S H I N G T O N (AP) THE OVERALL U.S. quarterly trade deficit surged to $61.3 billion from July through September, a fourth consecutive record, as the Asian financial crisis crashed even harder against America's shores. U.S. exports of everything from soybeans to computers are down for the year. The Commerce Department reported today that the current-account deficit rose 8.1 percent in the third quarter. The new deficit reading compares with a deficit of $56.7 billion in the spring. The global economic crisis, which has leveled a number of Asian countries and Russia, has sent American exports plunging, pushing American farmers into their worst financial crisis in a decade and triggering thousands of layoffs at manufacturing companies. U.S. exports of soybeans, corn, autos, chemicals, computers and lumber have plunged because of the loss of key overseas markets. Today's report marked the fourth straight quarterly record for the current account, the broadest measure of America's international performance, which tracks not only trade in goods and services but also investment flows and foreign aid. Financial markets showed little initial reaction to the trade figures, which were worse than had been expected. The Dow Jones industrial average was trading slightly higher on a big boost in demand for several energy stocks. While the U.S. economy overall has continued growing at a healthy pace despite the turmoil in foreign markets, American manufacturers and farmers have not fared as well. They have been battered this year by the loss of Asian markets and a flood of imported goods, made cheaper by foreign currency devaluations. The current-account deficit is on its way to a record high of $220 billion, far surpassing last year's deficit of $155.2 billion and topping the previous record of $168 billion set in 1987. The Clinton administration, concerned that the surging deficits will lead to a protectionist backlash in the United States, has been pushing for Europe and Japan to do more to spur their economies to provide markets for troubled Asian nations. President Clinton made that pitch personally last month during a trip to Japan, which is mired in its own worst recession in 50 years. Since that trip, U.S. officials have spoken hopefully of signs that the Japanese are beginning to take the steps necessary to deal with insolvent banks. Last week, 11 European countries unexpectedly cut interest rates in a coordinated effort to boost European growth, a move that was also welcomed by the United States. In the third quarter, the deficit in goods totaled $64.4 billion, essentially unchanged from the second quarter. U.S. exports of farm and manufacturing products fell again in the third quarter but a drop in imports of petroleum imports helped to keep the overall goods imbalance from rising from the record level reached in the second quarter. But America's surplus in services, such as travel and consultants' fees, shrank to $18.6 billion, down $2 billion from the second quarter. The third quarter deterioration also reflected a $2 billion increase in the deficit in investment income, which climbed to $5.5 billion as the amount Americans earned on their overseas investments decreased while the amount foreigners earned in this country rose. Unilateral transfers, which includes foreign add, totaled $10.1 billion in the third quarter, up slightly from $9.4 billion in the second quarter.