Quote:
Originally Posted by elysiantraveller
The Bad:
- $500-600 billion trade deficit totaling approx. 2.5% GDP
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Trade deficits are not always bad. It can vary, depending on the economy of a country, but for this country at this time, trade deficits are good, as explained in this article, "In Praise of Trade Deficits".
https://www.investopedia.com/article...it-effects.asp
Other countries are moving in the same direction. If you don't have a trade deficit, you have a trade surplus. And that can be bad for a country. China been working for some years now to decrease its trade surplus. A big reason for them is that running a big trade surplus has been driving investment money out of the country and into places like Vietnam.
Just as a trade deficit for the US means a capital surplus (increasing foreign investment), a trade surplus for China has meant a capital deficit (decreasing foreign investment).
Germany has also been running a trade surplus for some time. Now they are trying to cut it down.
https://www.brookings.edu/blog/ben-b...-is-a-problem/
