Trade Deficient - Oppurtunity Cost (October 28th, 2011)

What does "Made in China" mean?

• It makes up 2.7% of US consumer spending.
•  Only 1.2% reflects that cost of the imported goods.
• The U.S. content of "made of china" is about 55%.

It is all based on oppurtunity cost.
If the trade deficit should be true, then the trade surpass should make more jobs? Actually, no. Agriculture jobs have declined.
Why doesn't trade deficient destroy jobs?

1. The identity: You pay with your imports for your exports.
2. When you specialize, you get richer: Income Effect.

Round about ways:

• He lectures, gets money, pays for food, paying Wegmans.
• A list of factors are plausible to impact the trade.
• It allows trade to be plausible.

That frees up their budget (overtime the impact of income for food was changed and has freed up.)
But what is the trade deficient? What we spoke about is the trade account or current account?
USA buys assets: Capital account balance has skyrocketed on surplus. People have been buying shares and entrepreneurs buying buildings.
So long as we maintain attractive to foreign countries, we will remain strong.

By tearing a dollar, you are committing a felony. You hurt the American economy. No matter what, as long as you take the dollar way, the United States will always get it right back, which is good but it is also a good thing based on trade deficit.