US trade gap grows to $48.7B, as imports surge

The U.S. trade deficit expanded in November to its widest point in seven months, driven by a surge in imports that outpaced only modest growth in exports.
Associated Press
Jan 13, 2013

The Commerce Department report Friday suggests trade will drag on economic growth in the October-December quarter. A wider trade gap slows growth because it means Americans spent more on foreign products while U.S. businesses earned less in overseas sales.

Still, the report showed consumers have maintained an appetite for spending. They kept buying iPhones and other imported goods in November, despite high unemployment and low wage growth.

"A strong rebound in imports is not necessarily all bad for the U.S. economy because it indicates that consumers are spending. It shows the private sector is not dead," said Gregory Daco, senior economist at HIS Global Insight.

The trade gap widened 15.8 percent to $48.7 billion in November from October, the report noted. Imports grew 3.8 percent, led by gains in shipments of cell phones, including Apple's new iPhone.

Exports increased only 1 percent. And exports to Europe fell 1.3 percent, further evidence of the prolonged debt crisis that has gripped the region.

Paul Ashworth, chief U.S. economist at Capital Economics, predicts trade trimmed growth by about 0.5 percentage point in the final three months of the year. He expects fourth-quarter growth to be no more than an annual rate of 1.5 percent. That would be nearly half the 3.1 percent rate reported for the July-September quarter, which was helped by healthy growth in exports.

Martin Schwerdtfeger, senior economist at TD Bank, also expects the trade deficit to subtract from October-December growth. But he said the flood of imports could be signaling stronger consumer spending and business investment.

"The higher imports could mean that domestic consumption is improving. That would override some of the drag from a higher trade deficit," Schwerdtfeger said.

Through the first 11 months of 2012, the trade deficit is running at an annual rate of $546.6 billion. That's roughly 2.4 percent lower than the 2011 deficit.

Imports of consumer goods grew to a monthly record in November. Much of the growth was from cell phones and other household electronics products.

Oil imports dropped 2.5 percent, reflecting a fall in prices and lower volume.

Imports of foreign-made autos and auto parts rose, likely reflecting catch-up shipments following port disruptions in October caused by Superstorm Sandy.

The U.S. trade deficit with China, the largest with any country, totaled $29 billion in November. That's down slightly from the monthly record of $29.5 billion in October. But the trade gap with China is still on track to set a new annual record in 2012.

Trade was a modest positive for overall economic growth in 2012 and many economists believe that trend will continue in 2013. However, that forecast is based on a view that the European debt crisis stabilizes and growth in Asia begins to rebound.

In its latest outlook, a forecasting panel for the National Association for Business Economics predicted that the U.S. trade deficit for 2013 will total $533 billion, a slight improvement from the $540 billion deficit they expect when the trade numbers are totaled up for all of 2012. That expectation for a slight improvement is based on a view that export growth will outpace imports in 2013.

 

Comments

The Big Dog's back

Gee, do you mean all of our "job creators" are outsourcing jobs again?

2cents's picture
2cents

"job creators"
Yep, every man woman & child that shops places like Wally World for their goods.

http://www.epi.org/publication/i...

There you go again

How about some current data!?!?

2cents's picture
2cents
KnuckleDragger

You betcha, all those Union brothers and sisters you will see up at the Sandusky Walmart on Thursday (payday for most autoworkers). Go there on a Thursday or Friday and the lines are full of people wearing their local 913 and 1216 jackets. Apparently even union members care more about saving a buck than keeping their fellow Americans employed. Union members, saving money so the chinese can live better. Hypocrites.

pntbutterandjelly

One day soon...China won't have to import anything from us because they will be able to make everything they need themselves. By that time the U.S. economy will be 3rd. world at best. Thanks to the greed of everyone alike (corporations, stock holders, mutual fund owners, Walmart shoppers, but mostly....the big banks who set this all up).

2cents's picture
2cents

double post

Centauri

@ Big Dog, Do you buy goods from China?

KnuckleDragger

You know he does. Nearly all computers are made in China, so the head hypocrite in charge is criticizing everyone else on a chinese made computer.

mikel

this is what you voted for dawg. more chinese involvment. prezo has married america to chinese money and the divorce will be veryyyyyyyyy ugly!

Kimo

Save money so the Chinese can live better........

Those thread factories down south were in low wage "right to work" states, lot of good that "right to work" law did for those people, they still lost their jobs to China.
.

KnuckleDragger

Typed from your chinese made computer, while watching your chinese made television. Hypocrite.

Kimo

We keep sending our money to China and Japan, then blame everyone else for the bad economy.

Never fear, someday the Chinese will buy Cedar Point and all will be fine.
.

Fromthe419

We buy their crap and they buy our bonds to finance our ever growing government. They invest in the US because if they took their money back home their currency would rise and ours would go down and we would have our jobs back because the playing field would be even. Besides the FED, China and Japan are our largest buyers of our T Bonds.

Kimo

Re: "Do you buy goods from China? "

Howinthehell do you keep from buying goods from China?

When the factories close and move to China you either purchase those goods or commit suicide......

You can't buy an automobile today that doesn't have some Chinese content.

Kinda of a stupid question at this point in time....
.

Centauri

"Kinda of a stupid question at this point in time...."

@ Kimo, I shop Goodwill, estate auction sales and online auctions. I find a lot of good American made goods, used but still good. They are old but have much life left. Take for instance a Mirro pressure cooker or Mirro egg poacher. They are "Made in the USA" and I didn't have to buy some junk made in China. There are a lot of items still made in the USA. As long as I keep buying used or new American made items, I have no need to buy junk made overseas. Boycott goods made overseas. Don't buy any food from China. Your life and your pet's life depends on it. Who knows what is in food that comes from China. Soylent Green?

Contango

Europe, one the U.S.' major trading partners is in a funk hurting exports.

Also, Hurricane Sandy may have affected the Nov. numbers because some of the ports were blocked in Oct.

One month is not a trend.

-----------------------------

@ Kimo:

More like Asians keep buying our increasingly worthless paper.

-----------------

Pres. Obama is sending troops to 35 African countries. War tends to help boost economies.

Wish us luck!

Centauri

"Pres. Obama is sending troops to 35 African countries. War tends to help boost economies."

It is time to bring back the troops to go after the domestic enemies within our own government. Stop sending our children to war to use as cannon fodder to make the rich man richer. Didn't the troops take an oath to also go after domestic enemies?

Really are you ...

The war thing. We were just, and still are in, two of the longest wars in US history. How would another war help our already sluggish economy? What are Iraq and Afganastan doing to thank the United States for sending our brave military men and women into harms way?

The Big Dog's back

I guess we could wait for the terrorists to come here like bush did on 9-11.

2cents's picture
2cents

Excuse me! Clinton set us up by not taking any action, the crazys figured they could keep pushing.

http://www.foxnews.com/story/0,2...

The Big Dog's back

9-11-2001. President at the time? George W. Bush.

Contango

@ Dog:

Good to see that you're supporting Pres. Bush's invasion of Afghanistan.

Good to see that you support Pres. Obama's military actions in Libya, Somalia, Pakistan and elsewhere.

mikel

so now its ok to spend money on military operations in other countries as ong as bush didn't do it?

tk

I look hard for made in the USA products but rarely do I find what I need that isn't made in some other country. I would happily buy and pay more for products made in the USA.

wiredmama222

me too. especially if it put Americans back to work.

Kimo

Re: "I have no need to buy junk made overseas."

Bullspit.

The computer/phone/tablet you are using to post is either all or part "Made in China".
.

luvblues2

That's a promise.

Contango

Kimo writes:

"The computer/phone/tablet you are using to post is either all or part 'Made in China.'"

Better check your assumptions with some "inconvenient" facts.

#1. The intellectual property rights are usually owned in the U.S.

#2. If mgfing returned to the U.S., the work would be largely done by robots.

#3. Where is the iPhone built?:

http://www.forbes.com/sites/kenr...

luvblues2

Contributor 11 months ago

Swamp Fox

Its obbies economy......

As for 9-11 who was the president for the previous 8 years who did nothing to combat terrorism except disgrace the Oral Office...... Who can forget Blackhawk down when Billy Clinton pulled out our armor and depended on the UN, how did that work out....

OMG.LOL.WT_

From an article about Greece. Could be written about U.S.

"But the real problem with the public sector is the tiny elite of business people who live off the Greek state while passing themselves off as “entrepreneurs.” They bribe politicians to get fat government contracts, usually at inflated prices. They also own many of the country’s media outlets, and thus manage to ensure that their actions are clothed in silence. Sometimes they’ll even buy a soccer team in order to drum up popular support and shield their crimes behind popular protection, as the drug lord Pablo Escobar did in Colombia, and as the paramilitary leader Arkan did in Serbia."

Contango

@ OMG.LOL.WT_:

Greece has the EU, ECB, the IMF and others to help bail 'em out and sustain them.

The U.S. is "too big to fail" and has only itself.

Centauri

http://tinyurl.com/amjurx7
"IN A final drive to win votes for the North American Free Trade Association, President Bill Clinton has offered support at the next election for Republicans who vote for it. 'I don't believe any member of Congress should be defeated if they vote for Nafta,' he said."

http://www.senate.gov/legislativ...
A bill to implement the North American Free Trade Agreement.

http://clerk.house.gov/evs/1993/...
NORTH AMERICAN FREE TRADE AGREEMENT IMPLEMENTATION ACT

Wouldn't Clinton promising Republicans support in the next election be a form of bribery? Did Clinton really say "I don't believe any member of Congress should be defeated if they vote for NAFTA" or is that false? If false, please show your proof.

Fromthe419

"The trouble with socialism is that you eventually run out of other people’s money." - Margaret Thatcher, former Prime Minister of Great Britain

16.4 trillion in debt and soon to be 20 trillion in 2016. We have been betrayed by our government and this is not a Democrat or Republican issue. We have been blind-sided by both. The endless cycle of spend, borrow and print has to come to an end. The Fed's 100 year charter is up this year, call your congressman and demand that they vote to End the Fed. Money creation should be for the benefit of the American people not to enslave it through taxation.

The Big Dog's back

The problem is we don't have Socialism here. We have Vulture Caapitalism, a big Ponzi scheme.

Fromthe419

I stand corrected, we have fascism....Central State Planning and Central State control over our economy.

Pete

Wrong again Brutus. We have too much socialism. That is what is breaking the budget.

It is the entitlements that are eating up our tax dollars.

Dr. Information

Big Dog is nothing more than a pot stirrer folks. If you say its dark outside, he will say its yellow, and yes, it doesn't make sense, so don't try.

Just breeze right over this persons stuff. All they do is try to light a flame and then run for cover while it burns.

Contango

"I am the best friend the profit system ever had," - FDR

http://newdeal.feri.org/court/fd...

It's called corporatism or fascism.

Dr. Information

So many scream.....Don't buy from China, while they sit on their couch....made in China, text on their iPhone...made in China...and watch their TV....most likely made in China.

Contango

Be careful what you protectionistas wish for:

"China is Ohio's third biggest export market after Canada and Mexico."

Read more: http://www.businessinsider.com/1...

whocares

President Clinton made China a most favored trading nation years ago.