U.S. Account Gap Largest Since '08

story from FoxBusiness
June 14, 2012
Reuters

U.S. Account Gap Largest Since '08
The "Current Account" is a measurement that measures the flow of goods, services and investments into and out of the United States.

The U.S. current account deficit widened more than expected in the first quarter to $137.3 billion, the largest gap since fourth quarter 2008, a government report said on Thursday.

The current account, which measures the flow of goods, services and investments into and out of the United States, widened to 3.6 percent of gross domestic product, also the biggest since fourth quarter 2008. In the fourth quarter of last year the deficit was 3.1 percent of GDP.

Most of the widening came from a drop in the U.S. surplus on income and an increase in the trade deficit, the Commerce Department said.

Analysts surveyed before the report had expected the current account gap to widen to $132.3 billion.

The Commerce Department revised its estimate of the fourth-quarter current deficit to $118.7 billion, from $124.1 billion previously.

The U.S. Economy is in a downturn ?

The US in a downturn, really?

It has been in a downturn for over 3 years

And of course it's FoxBuiness who's Captain Obvious

Stupid double post...

Originally posted by MrXYZ
The US in a downturn, really?

It has been in a downturn for over 3 years

And of course it's FoxBuiness who's Captain Obvious

edit on 14-6-2012 by MrXYZ because: (no reason given)

Are you suggesting the numbers are fabricated by FoxBusiness ?
The same story is all over the business wires.


Bu Bu Bu BUT.......

Recession Ended 3 Years Ago This Month, Says National Bureau of Economic Research


The recession ended in June of 2009 !!

Yes it did. It absolutely did !!

This is according to the Business Cycle Dating Committee of the National Bureau of Economic Research
(who are those guys ?)

Wait now .... This gets better.

Not only is the recession long over, we have been in an economic expansion since then !!


[deep long inhale ........ fast loud exhale]

The current potus the economy is doing fine!!!

Fox Business lies!!!!!

I think I can speak for everyone in America when I say........

Tell us something we didn't know.

reply to post by xuenchen


Not that I want to start an argument or anything...

but quoting press releases about our economy is generally counterproductive

Because the purpose of "News" media is to convince you....

Look how they tell us about economic things like this.... over and over for 6 years....

2006
Housing Turnaround? Home Sales Up in March (ABC News, April 25, 2006)
Home builders see bottom of housing slump (CNN, December 5, 2006)
New home sales: Back from the dead? (CNN, December 27, 2006)
Read Between All Those For-Sale Signs (NYT, August 27, 2006)
New Signs of Cooling in Housing (NYT, August 24, 2006)
NAR’s Existing Home Sales & Prices (TBP, November 2006)
Greenspan Says `Worst’ May Be Past in U.S. Housing (Bloomberg, October 6, 2006)
Home builders see bottom of housing slump (CNN, December 5, 2006)
New home sales: Back from the dead? (CNN, December 27, 2006)
2007
U.S. Realtors see gradual existing-home sales rise (Reuters, February 7, 2007)
IMF believes US housing market may bottom out (Reuters, April 11, 2007)
Housing Market Nears Bottom (Forbes, May 25, 2007)
Hovnanian Chief Says Housing Bottom Is `Very Near’ (Update6) (Bloomberg, September 14, 2007)
Housing Predictor Reports U.S. Real Estate Turnaround (RISMedia, May 22, 2007)
Sales & Volume Begin to Flatten Out! (Peterson Realty April 2, 2007)
Whoops! Another 2009 turnaround estimate (Arizona Real Estate Notebook, July 25, 2007)
Real Estate Outlook: Will Housing Turn Around? (Realty Times, December 31, 2007)
2008
NAR Housing Market “Bottoms” (TBP, January 2008)
Florida Real Estate Market Reached Bottom in 2007; Market Expected to Recover from ‘Indigestion’ (Reuters, January 7, 2008)
U.S. Home Sales to Reach Bottom in 2008, Bankers Say (Update3) (Bloomberg, January 14, 2008)
Zell Sees Start of Housing Recovery in the Spring (CNBC, February 26, 2008)
WSJ Confuses Seasonality with Recovery: How Counter-Productive is Realtor Association Spin? (TBP March 25th, 2008)
Wave of Foreclosures Drives Prices Lower, Lures Buyers (WSJ March 25, 2008)
Existing Home Sales, Non Seasonally Adjusted, Explained (TBP, March 25th, 2008)
Bottom’s Up: This Real-Estate Rout May Be Short-Lived (Barron’s, July 14, 2008)
Cramer Calls the Housing Bottom (CNBC, August 27, 2008)
Real Estate Markets Most Likely To Rebound (Forbes, October 29, 2008)
2009
Commercial Real Estate Market to Hit Bottom Next Year, Urban Land Institute (Realty Times, January 7, 2009)
U.S. Housing Market May Bottom in 2009, Zandi Says (Bloomberg, February 9, 2009)
Home Price Bottom Predicted by Year End (The Truth About Mortage, February 9,
Home-builder shares jump as February new home sales increase (Marketwatch, March 25, 2009)
Real Estate–What Recovers First? (Forbes, March 18, 2009)
Existing Homes Surprise: Sales Turn Up, Prices Firm (IBD, 3/23/2009)
Signs of life emerging in housing sector (MSNBC, April 7, 2009)
Real Estate Outlook: A Turnaround May Be In Sight (Realty Times, April 14, 2009)
Greenspan Sees ‘Seeds of a Bottoming’ in U.S. Housing (Bloomberg, May 12, 2009)
U.S. home market shows ‘encouraging’ signs (USA Today, July 24, 2009)
U.S. Economy: Home Prices Rise, Confidence Declines (Bloomberg, July 28, 2008)
Home prices show signs of stabilizing in May (AP, July 28, 2009)
U.S. housing starts keep recovery hopes alive (Reuters, August 18, 2009)
Slowly but surely, economy shows signs of recovery (USA Today, August 28, 2009)
Commercial Real Estate Recovery Second-Half 2010 according to Jones Lang LaSalle’s U.S. National Economic & Property Outlook (The Paramus Post, November 19, 2009)
2010
Mortgage Trends Show Real Estate Stability (Wall Street Geek, January 20, 2010)
In hard-hit markets, some see signs of bottom (MSNBC, January 29, 2010)
Housing Starts in U.S. Increased 2.8% in January, Permits Fell (Bloomberg, February 17, 2010)
Home prices rise 0.3 percent in Dec. (The Washington Times, February 23, 2010)
Warren Buffett sees housing market bouncing back by 2011 (USA Today, March 1, 2010)
Housing Real-Estate Recovery Signaled as Fed Unwinds (Update1) (Bloomberg, March 15, 2010)
Turnaround Coming for Real Estate? (Seeking Alpha, April 9, 2010)
Wasn’t commercial real estate supposed to crash? (CNNMoney, June 8, 2010)
Real estate market primed for turnaround (Savannah Now, December 30, 2010)
2011
U.S. housing bottom seen in mid-2011: poll (Reuters, January 28, 2011)
Why the Housing Bottom Might Be Here (U.S. News, February 2, 2011)
Will Real Estate Turn Around in 2011? (Outer Banks Market Report, March 2, 2011)
Monthly Housing Market Trends Point in a Positive Direction (Yahoo! News, June 14, 2011)
Home Prices In U.S. Showed Signs Of Stabilizing (Bloomberg, August 30, 2011)
Housing market predictions for 2012 (CBS News, December 7, 2011)
Is housing bouncing back? (The Washington Post, December 20, 2011)
2012
Has The Housing Market Hit Its Bottom? (Forbes, January 10, 2012)
Homeownership rates fall to 66% as downturn nears a bottom (USA Today, February 1, 2012)
Ready to Rebound (Barron’s, March 19, 2012)
Has the Housing Market Finally Hit Bottom? (Time, April 27, 2012)
Mortgage-Bond Bigwig Lewis Ranieri Calls Housing Bottom (U.S. News, May 7, 2012)
Report: Housing Market Recovery Has Officially Begun (TIME May 15, 2012)
Housing starts add to recovery signs (Reuters, May 16, 2012)
Buyer alert: Rising prices ahead (Boston.com, May 22, 2012)
April new-home sales increase 3.3%, pointing to recovery (Detroit Free Press, May 24, 2012)
Real estate could be on the rebound (DelMaravnow May 27, 2012)
Housing Market May Finally Be Turning Around With Sales Up 10 Percent In April (Huffington Post, May 28, 2012)
Housing Prices Show Signs of Stability (Wall Street Journal, May 29, 2012)
U.S. Home Prices: Has the Tide Turned? (ABC News, May 29, 2012)
Home prices at post-bubble lows but may point to market stability (LA Times, May 29, 2012)
The Housing Bottom Is Here (Business Insider, May 29, 2012)
S&P: Home Prices See New Bottom, Recovery On Deck (Reverse Mortgage Daily, May 29, 2012)

As if telling us... makes it true.

reply to post by Maxmars


Yes I agree the media plays 98% of the "convincing" agenda.

Your point is correct.

But the quotes from your topic appear to be dealing mainly with domestic issues.

The U.S. Current Account are measurements related mostly to international trade.

Certain figures like exports however, do reflect domestic production.

The FoxBusiness story is quoting "facts" directly from The U.S. Department of Commerce.
(I further agree that these numbers could easily be manipulated just the same)

One question would be:
What parts of the report would be considered "manipulated" in this case ?
and for "who's" advantage ?


More background on the Current Acount

In economics, the current account is one of the two primary components of the balance of payments, the other being capital account. It is the sum of the balance of trade (net earnings on exports minus payments for imports), factor income (earnings on foreign investments minus payments made to foreign investors) and cash transfers.

The current account balance is one of two major measures of the nature of a country's foreign trade (the other being the net capital outflow). A current account surplus increases a country's net foreign assets by the corresponding amount, and a current account deficit does the reverse. Both government and private payments are included in the calculation. It is called the current account because goods and services are generally consumed in the current period.[1]

The balance of trade is the difference between a nation's exports of goods and services and its imports of goods and services, if all financial transfers, investments and other components are ignored. A Nation is said to have a trade deficit if it is importing more than it exports.

Here's the current report (the page may update as figures change)
News Release: U.S. International Transactions

Goods and services

The deficit on goods and services increased to $151.0 billion in the first quarter from
$146.3 billion in the fourth.

Goods

The deficit on goods increased to $194.5 billion in the first quarter from $189.3 billion
in the fourth.

Goods exports increased to $388.5 billion from $382.2 billion. Exports of four of the
six major end-use categories increased. The increase was more than accounted for by increases
in capital goods exports and in automotive vehicles, parts, and engines. The increase in capital
goods resulted from increases in civilian aircraft, engines, and parts, in computers, peripherals,
and parts, and in other industrial, agricultural, and service industry machinery. The increase
in automotive vehicles, parts, and engines exports was largely due to increases in passenger
cars and in trucks, buses, and special purpose vehicles. Changes in the other major categories
were relatively small (Table 2a).

Goods imports increased to $583.0 billion from $571.4 billion. Imports of four of the six
major end-use categories increased. The increase resulted from increases in imports of automotive
vehicles, parts, and engines, of capital goods, and of industrial supplies and materials. The
increase in automotive vehicles, parts, and engines was due, in part, to an increase in passenger
cars from countries other than Canada. The increase in capital goods was more than accounted for
by an increase in machinery and equipment, and the increase in industrial supplies and materials
reflected an increase in petroleum and products. Consumer goods imports decreased; the largest
decrease was in durable goods (Table 2a).

Does anyone think these numbers reflect the U.S. domestic economy ?

reply to post by xuenchen


NEWS FLASH....Europe has an economic crisis!!!

The gap, the broadest measure of international trade because it includes income payments and government transfers, grew 16 percent from a revised $118.7 billion in the prior quarter, the Commerce Department reported today in Washington. The median forecast of economists in a Bloomberg News survey called for the deficit to widen to $131.9 billion.

The European debt crisis may limit growth overseas more than it hurts the world’s largest economy, signaling the deficit may continue to climb as U.S. exports cool faster than imports. A yawning imbalance is also a reminder the U.S. remains dependent on foreign investors for funding

www.businessweek.com...

Is it your contention that President Obama is responsible for the European Economic crisis?...or that he is responsible for the USA being in a much better position economically than Europe?

We are in a recovery...and Europe is in a mess...Europe had more severe Austerity measures and did much too little to strengthen and regulate thier banking system.

Vote GOP and we can be Greece, Spain or France as well....but in the meanwhile it appears that we are recovering under the Obama Administration while Europe is double-dipping.

Not a partisan view...the view of Economists, Wall Street and everyone one with an understanding of finance or economics absent a political agenda...even those with a political agenda still understand the difference when thier portfolio depends on it.

Yes...the US Account Gap has widened...but it has NOTHING to do with a downturn in the US Economy and everything to do with Demand for US products in Europe falling.

Every analyst and economist I have heard speak about agrees that it is not enough of a fall-off, even if it gets worse, to significantly effect our recovery.

Europe “is problematic,” Mergenthaler said at a June 13 conference. “I think you’re seeing multinational clients move money out of Europe to go to some of the high-growth markets and you see domestic clients just pulling back on spending.”

www.businessweek.com...

Where do you think that money is moving to? Perhaps the worlds largest economy? an economy that is recovering?

Wonder how Mitt Romney feels about this since most of his fortune is invested abroad?

reply to post by xuenchen

Of course its in a down turn,the republicans sabatoged it on pupose.

Solid reasoning prevails.

You are correct; and I know that the commercial pressures that lead to the kind of "journalism" (for lack of a better word) I posted is definitely domestic.

But I have become so cynical about the numbers we are given, and the predominantly 'closed-door' deliberations and policy meetings (take the trans-pacific partnership for example), that I find myself questioning the totality of the numbers our politically-appointed servants produce... and how they come to produce them.

In the end, even taking into account that the 'official' numbers the Chamber of Commerce and others like the Fed and such disseminate are really "official" they could nevertheless be legally misleading.... "for the good of the country" as it were... (or dare I say "for national security"?)

People entrenched in the paradigm of commerce as progress could easily justify, for example, continually reporting that home prices have "reached the bottom" for 6 years straight... because in their minds it might "help the economy".

Where international economics has become a form institutionalized gambling... there's no telling any longer what we can trust to be accurate.

It's one of those sad things about our world where unless you live it personally... there's no telling what the truth is... especially when the truth may be politically inexpedient.... or "bad" for business.

Originally posted by xuenchen
story from FoxBusiness
June 14, 2012
Reuters

U.S. Account Gap Largest Since '08

 

Largest since 2008?? And still LOWER than anytime prior to 2008 and during the preceeding 8 years of GWB.

THAT is why Fox News sucks. Sky is falling as long as a Dem is in office.

See here....
www.tradingeconomics.com...

reply to post by Indigo5

Yes...the US Account Gap has widened...but it has NOTHING to do with a downturn in the US Economy and everything to do with Demand for US products in Europe falling.

On the surface I would agree.

But we actually have seen an increase of exports to the EU under Obama.
Along with a continuous increase in the trade deficit to the EU under Obama.
(this may not be Obama's fault however)

just for 2012:


see the same pattern --> Trade in Goods with European Union

Originally posted by LastProphet527
reply to post by xuenchen

 

Of course its in a down turn,the republicans sabatoged it on pupose.

Interesting.

How and when did that happen ?

Originally posted by xuenchen

The FoxBusiness story is quoting "facts" directly from The U.S. Department of Commerce.
(I further agree that these numbers could easily be manipulated just the same)

The 2008 chosen for comparison numbers...whilst failing to mention that the eight years prior to 2008 were all much higher than current numbers. They cherry picked the year.

Originally posted by xuenchen

One question would be:
What parts of the report would be considered "manipulated" in this case ?
and for "who's" advantage ?

Well they could have mentioned the single greatest driver of the Gap...the European economic crisis? Or the difference between our economic status (recovery) and Europes continuing economic crisis? Or the degree to which this gap actually effects or reflects the health of our domestic economy?

If the Gap was 2 times what it is now back in 2004 and 2005...does that mean our economy was tanking then?

www.tradingeconomics.com...

Originally posted by Indigo5

Originally posted by xuenchen
story from FoxBusiness
June 14, 2012
Reuters

U.S. Account Gap Largest Since '08

 

Largest since 2008?? And still LOWER than anytime prior to 2008 and during the preceeding 8 years of GWB.

THAT is why Fox News sucks. Sky is falling as long as a Dem is in office.

See here....
www.tradingeconomics.com...

The link is showing the Account Gap in comparison to GDP.

How does that compare to the real numbers ?

It looks like an Apple / Potato comparison.

Originally posted by xuenchen
reply to post by Indigo5

 

Yes...the US Account Gap has widened...but it has NOTHING to do with a downturn in the US Economy and everything to do with Demand for US products in Europe falling.

On the surface I would agree.

But we actually have seen an increase of exports to the EU under Obama.
Along with a continuous increase in the trade deficit to the EU under Obama.
(this may not be Obama's fault however)

just for 2012:

see the same pattern --> Trade in Goods with European Union

Scroll down in your own link and look at the numbers year over year.....It is the opposite of a "continuos increase in the trade deficit to the EU under Obama"....when compared to the conservative administration that preceeded him...please stop the BS.....fear mongering when applied to the US economy has real world consequences in consumer sentiment and thus is a particularly sociapathic form of political spin during a recovery....




2011 : U.S. trade in goods with European Union

TOTAL 2011 -99,881.0


2010 : U.S. trade in goods with European Union

TOTAL 2010 -79,611.5


2009 : U.S. trade in goods with European Union

TOTAL 2009 -61,201.5


2008 : U.S. trade in goods with European Union

TOTAL 2008 -95,807.4


2007 : U.S. trade in goods with European Union

TOTAL 2007 -110,243.4


2006 : U.S. trade in goods with European Union

TOTAL 2006 -118,594.8


2005 : U.S. trade in goods with European Union

TOTAL 2005 -124,462.1


2004 : U.S. trade in goods with European Union

TOTAL 2004 -110,729.0


2003 : U.S. trade in goods with European Union

TOTAL 2003 -97,871.6


2002 : U.S. trade in goods with European Union

TOTAL 2002 -85,692.2


2001 : U.S. trade in goods with European Union

TOTAL 2001 -64,637.2

Originally posted by xuenchen

Originally posted by Indigo5

Originally posted by xuenchen
story from FoxBusiness
June 14, 2012
Reuters

U.S. Account Gap Largest Since '08

 

Largest since 2008?? And still LOWER than anytime prior to 2008 and during the preceeding 8 years of GWB.

THAT is why Fox News sucks. Sky is falling as long as a Dem is in office.

See here....
www.tradingeconomics.com...

The link is showing the Account Gap in comparison to GDP.

How does that compare to the real numbers ?

Here you go...any other questions? Notice the comparison to pre-Obama, FOX picked 08 for a reason



Same link as before...

reply to post by xuenchen


Fox is stating the obvious because anyone working in the financial industry (commercial real estate in my case) knows that anyone saying we're not in a crisis is a moron.

The government published figures are all nonsense. Politicians will ALWAYS fudge the numbers to make it look better than it is, especially during an election year. This time it's Obama's administration, but Bush's administration was HORRIBLY slow at admitting the issues.

I also think people don't realize how bad things really are:

1) Europe has 5 countries that have or probably will require bailouts. Looking at the figures objectively, Europe CAN bail out Spain...but they CAN'T bail out Italy too without help from China (I'd say the US, but the US has no money tbh). The only "good" countries in Europe are Germany, the Scandinavian countries, and above all Switzerland. The Swiss national bank guys are GENIUSES. Why? Because they pegged their strong currency to the Euro, losing $7m every single hour, yet they still make a profit. Why? Because all the other countries are sooooooo messed up, people are loaning Switzerland money (bonds) and PAY for that right. They are NOT even making a return, they pay 0.78% just for Switzerland to hold their money and pay them back the same amount minus that percentage. That's how crazy the world we live in is!!

2) The US is actually worse off than Europe if you bother to check up on the numbers. The US also faces another HUUUUUUUUUUGE threat no one seems to talk about. Right now the US$ is the world's reserve currency...but it's pretty clear by now that won't be the case forever. Why? Because having the world reserve currency dependent on a single currency is STUPID...and this crisis showed it. In the end, they'll create a basket of currencies to replace it. Now, the last time a reserve currency was replaced (Sterling), that currency lost 80% (!!!!) of its value. THAT'S what should scare people. Of course no one talks about that because it's an election year and all the numbers are messed with to make them look better than they really are...unemployment (not counting working poors), inflation, etc.

3) China's growth is slowing. Their HUUUUUUUGE state owned companies all operate at an LTV of 90%, so they need around 7.5% annual growth to be able to service their debt. Right now, it seems that won't be the case for much longer. However, China has a big advantage...their middle class (the people who are actually spending most of their income compared to the super rich) is expanding and their spending will probably help to avert the brunt of that crisis. Yes...even their coastal real estate bubble crisis that's slowly approaching.

The sad part is, those in power (politicians) are a bunch of morons...and it doesn't matter who either. One on hand you have Obama who pretends he's left, yet he gave more cuts to the top 1% than the middle class or poor. Economically that's retarded because the middle class and poor tend to spend most of their salary, therefore stimulating the economy. The rich tend to invest their money in ways that often have ZERO positive effect on economic growth. I wouldn't call myself rich, but I'm probably in the "wealthy" category, and for the past 2-3 years most of my investments were in gold and currencies...creating ZERO jobs and doing NOTHING to help the economy. At least I'm not pretending otherwise like some politicians who claim "job creators" are the backbone of the economy.

On the other hand, you have people like Romney who are 100% owned by corporate America...even more so than Obama. If the oil/defence industry says "jump!", he asks "how high?". "Corporations are people, my friend!" says it all. His tax plans and other initiatives make it abundantly clear that he's only interested at supporting his main donors...the top 1% (because that's who invests in him the most, look it up!!). And again, the people who support him are NOT the ones stimulating the economy. The people who really SPEND (and therefore stimulate the economy) are mostly the middle class and the poor because they spend a majority of their income.

And lastly, you have fools like Ron Paul (yeah, bring on the hate...I don't care). They have some good idea and might seem like a valid alternative, but then they say STUPID stuff like "omgomgomg, laissez-faire free market ftw", which just shows how little they understand about the economy. If he had studied economics, he's know that the "free market" requires an EFFICIENT MARKET where everyone acts RATIONALLY. We all know that's simply not the case...which is why NO country has a true free market. A free market without rationality (which is the only version that could practically exist) is only making it easier for the top to screw over the majority. I know RP supporters get really angry if you criticise RP, but he has NO CLUE about economics!!