This is a sad video that shows that collapse in Detroit.
http://afteramerica.wordpress.com/
U.S. Trade Bubble Continues to Collapse
Goods imports are down 33% over the past year, but the U.S. trade deficit, a key part of the global financial crisis, needs to narrow further!
The trade report released Apr. 9 shows that the trade bubble continues to collapse—and that’s good news.
The trade deficit shrunk to $26 billion in February, or an annual rate of $313 billion, down from $743 billion a year ago. Goods imports alone are down 33% over the past year. Leaving out oil, the imports of nonpetroleum goods are down by 26% over the past year.
This shouldn’t be a surprise to readers of my BusinessWeek blog, Economics Unbound. Global trade is following the same steep downward path as home prices and borrowing, after having followed the same upward path.
And why not? All three are manifestations of the global credit bubble. Cheap credit and the ignorance of risk helped fuel excessive trade. It made perfect sense to locate factories overseas if it cost nothing to build them, if you didn’t worry about the cost of financing the goods in shipment, and if you ignored the risks of having a 10,000 mile-long supply chain running through six countries.
What’s more, the huge trade deficit was itself an essential part of the global financial crisis. For one, it reflected massive borrowing by U.S. households to buy imported goods, with money they did not have. Second, it reflected massive lending by foreigners in the U.S., which eventually morphed into subprime mortgages and other risky ets.
Further Fall Can Help in Financial System Fix
But as long as the U.S. is running a big trade deficit, the wound is still bleeding. The non-oil merchandise trade deficit is still at $22 billion a month, or $267 billion a year. It needs to fall further.
A deeper fall in imports and the trade deficit will have several salutary effects. First, it will mean that the U.S. has to borrow less from overseas. Second, it will make it easier to fix the financial system, since banks and other financial institutions will not be funneling so much foreign money into the U.S. economy. Third, and perhaps most important, it will become easier to see just what remains of our manufacturing base. I’m reporting a new story right now about how excess globalization, fueled by the credit bubble, distorted growth statistics in the U.S. and around the world.
The downside of the fall in global trade is that it is going to be very harmful to many countries which grew too dependent on exports, including Japan and Germany. If I’m right, and the global trade boom was another manifestation of the global credit boom, a big chunk of these exports are not going to come back any time soon.
Duration : 0:6:18
[youtube fA_tIvb8CI4]
September 8th, 2009 at 2:30 am
blacks + democrats= …
blacks + democrats= Detroit! Nuke it and start over.
September 8th, 2009 at 2:30 am
I remember reading …
I remember reading a john birch society pamplet back in the 80`s entitled “When the reds run a city“ which was about detroit. Well now you can see what happens when the taxem to death left takes over.
September 8th, 2009 at 2:30 am
Is Detroit really …
Is Detroit really as violent as everyone is telling me it is?
September 8th, 2009 at 2:30 am
They’re brave to be …
They’re brave to be driving through Detroit slums without a bullet proof vest
September 8th, 2009 at 2:30 am
Detroit’s a union …
Detroit’s a union state company wont touch it. I live in a Right to Work State, that means you don’t have to join a union if it exist and if you want to quit you can but the companies can fire you without reason.
September 8th, 2009 at 2:30 am
Audit the Fed.
Audit the Fed.
September 8th, 2009 at 2:30 am
Wow! Is this real? …
Wow! Is this real? I just can’t believe we have this in the U.S. What the heck happen? Detroit should be a money maker not slum. The government is more concern with other countries affairs instead of ours. All I can say is wow and sad!
September 8th, 2009 at 2:30 am
NOZZLERETURNS: Sooo …
NOZZLERETURNS: Sooo…..we punish everyone else who is not like what you described. You eradicate any opportunity for the children of those who aspire to go beyond what past failures and barriers of those “illiterate s” you say. In this case, why should anyone even go to school? Lemme guess, it is better to have children running around with drugs and guns than it is to give them an opportunity to work and better their lives? What is your answer to this?
September 8th, 2009 at 2:30 am
Is this everyones …
Is this everyones future ?
September 8th, 2009 at 2:30 am
Now I see why it’s …
Now I see why it’s so cheap to buy a house in Detroit…They don’t come with windows or roofs.
September 8th, 2009 at 2:30 am
This is a gd shame.
This is a gd shame.
September 8th, 2009 at 2:30 am
The powers that be …
The powers that be and many others robbed this city and ran! This is a third world country inside the US. This city enacted public policy and the lack of diversity ruined this city! Now it is run by a city council who act like bickering children!
September 8th, 2009 at 2:30 am
WOW!! that’s so so …
WOW!! that’s so so sad man. #1 country in the world and it looks like that. I don’t get it, why are the US giving huge bail outs to these big companies, when they are moving south and leaving the workers behind. The US should give bail outs to the cities that needs that money.
September 8th, 2009 at 2:30 am
wow…. wow…
wow…. wow…