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Strategies & Market Trends : Graham and Doddsville -- Value Investing In The New Era -- Ignore unavailable to you. Want to Upgrade?

To: porcupine --''''> who wrote (1579)	4/20/1999 11:16:00 AM
From: porcupine --''''>	Read Replies (1) \| Respond to of 1722

Trade Deficit Hits Record $19.4B Filed at 8:47 a.m. EDT -- April 20, 1999 By The Associated Press WASHINGTON (AP) -- America's trade deficit soared to a record $19.4 billion in February as the global financial crisis depressed U.S. exports for a fourth straight month while booming consumer demand pushed imports to an all-time high. The Commerce Department reported today that February's deficit was 15.6 percent higher than the previous record, a $16.8 billion imbalance in January. In February, U.S. exports edged down 0.6 percent to $76.6 billion, led by a $927 million decline in sales of commercial aircraft. Imports jumped 2.3 percent to an all-time high of $96 billion as demand for foreign cars, clothing, toys, televisions and stereos soared. With back-to-back records, the trade deficit so far this year is running at an annual rate of $215 billion, far surpassing last year's all-time high of $169 billion. Economists believe that as long as the U.S. economy remains strong and many of America's major export markets remain in recessions caused by the steep plunge in financial markets that began in Asia in July 1997, the U.S. trade deficit will continue to rise. A widening trade deficit is the one cloud on an otherwise bright economic horizon for the United States, which has managed to remain what Federal Reserve Chairman Alan Greenspan has termed an ''oasis of prosperity'' in a sea of economic trouble around the world. Greenspan, however, expressed concerns last week about a growing movement toward protectionism in this country, a development that has the White House worried as well. The administration is concerned that erecting U.S. trade barriers will trigger copycat responses while jittery markets are fearful that political pressures will make nations turn inward in response to the worst global economic crisis in 50 years. President Clinton, worried about a growing protectionist mood in Congress, balked earlier this month at reaching a sweeping trade agreement with China. That disappointed many in the business community who have complained for years about China's high trade barriers. For February, the deficit with China narrowed slightly to $4.6 billion. But America's deficit with Japan shot up 13.1 percent to $5.3 billion. The administration is pursing a number of trade negotiations with Japan in hopes of showing progress in opening that market to U.S. firms by the time of Prime Minister Keizo Obuchi's visit next month. In one bright spot, America's surplus in services, which includes such things as tourism and consulting fees, rose 4 percent to a monthly record of $6.7 billion. The surplus in services, however, did little to dent a record $26.2 billion deficit in the goods area. U.S. exporters continued to find it hard to make overseas sales because of an economic crisis that has pushed one-third of the global economy into recession. The February drop in exports included a $130 million decline in farm sales, to $3.6 billion, with the drop led by falling shipments of soybeans and wheat. American farmers, who grow one-third of their crops for export, are suffering their worst times in a decade. In addition to commercial aircraft, manufactured exports of telecommunications equipment and electric generators also dropped in February. On the import side, foreign shipments of autos and automotive parts rose to a record $14.6 billion, up $710 million for the month. Other increases included computer accessories, up $449 million; clothing, up $202 million; toys, up $156 million; and televisions and VCRs, up $150 million. America's deficit with Mexico climbed to a record $1.8 billion in February while U.S. exports to Brazil, which became the latest victim of the global currency turmoil in January, dropped to $910 million, the lowest level since April 1996.