- U.S. dollar continues to fall versus foreign currencies as a result of less confidence in the U.S. dollar... which will:
- make imported goods more expensive... including oil
- make U.S. travel more attractive to foreigners
- increase foreign ownership of U.S. real estate and corporations [I said previously that the trade deficit was a concern, ultimately, about who controls the U.S. assets]
- increase the risk of inflation
- increase U.S. corporate earnings (in U.S. dollars) from overseas operations
- China accounted for more than 1/2 of the total non-oil trade deficit which is a result of both importing lower-cost Chinese products and outsourcing production and support of U.S. made products
- Jobs are leaving the U.S. for the lowest cost source and there are serious disagreements about the impact of this trend for the U.S.
- U.S. miltary expenditures are more than these combined:
* 2001 FundingRussia* 65.0 China* 47.0 Japan 42.6 United Kingdom 38.4 France 29.5 Germany 24.9 Saudi Arabia 21.3 Italy 19.4 India 15.6 South Korea 14.1 Brazil* 10.7 Taiwan* 10.7 Israel 10.6 Spain 8.4 Australia 7.6 Canada 7.6 Netherlands 6.6 Turkey 5.8 Mexico 5.9 Kuwait* 3.9 Ukraine 5.0
Monday, December 06, 2004
Excessive Spending: Miscellaneous Thoughts
I have previously posted concerns about the budget deficit and negative trade balance. Here are some things to consider. You draw your own conclusions, if you can.