
IPFS News Link • Economy - International
The Shrinking Global Economy (In 3 Awkward Charts)
• Zero HedgeThe US trade deficit (exports minus imports) has been getting smaller. Since a trade deficit subtracts from GDP growth, a shrinking deficit will, other things being equal, produce a bigger, faster-growing economy (that's the mainstream take).
But other things aren't equal. It turns out that the components of that trade balance figure are both shrinking. Exports — the stuff we sell to foreigners - have been declining since the dollar spiked in 2014. That's not a surprise, since a strengthening currency makes exports more expensive and thus harder to sell. So other countries are buying less of our stuff, which though not surprising is a bad sign.