Mudcat Café message #1377829 The Mudcat Café TM
Thread #62901   Message #1377829
Posted By: Amos
12-Jan-05 - 08:54 PM
Thread Name: BS: Popular Views of the Bush Administration
Subject: RE: BS: Popular Views of the Bush Administration
U.S. Trade Deficit Hit Highest Figure Ever in November

Published: January 12, 2005

WASHINGTON, Jan. 12 - The United States trade deficit soared to a new high of $60.3 billion in November, the Commerce Department reported today. The figure breaks all previous monthly records and confounds predictions that the deficit would diminish now that the dollar has weakened and the price of oil has eased.

Instead the trade gap has now reached the size of the Grand Canyon, in the words of one analyst, and is putting increased pressure on the dollar to drop even further, pressure that could continue unabated.

The dollar fell sharply on news of the unexpectedly wide trade deficit, dropping to 102.42 Japanese yen by this afternoon, from 103.25 yen late Tuesday. The euro climbed to $1.3266, from $1.3123.

The jump in the trade deficit showed a surprising weakening in American exports across the board, from agricultural products to capital goods like aircraft and semiconductors. The figures released by the Commerce Department showed that the trade deficit is on pace to exceed $600 billion for 2004, up from $496.5 billion last year.

The United States is too deeply in debt, economists said, and several things would have to be changed if the trend was to be reversed. American savings would have to increase. The administration would have to make tough choices to balance the budget. And China would have to make its currency exchange rate flexible rather than tied to the dollar.