Buffett weighs in on US rec trade deficit

[JUGGERNAUT]

http://www.yahoo.com/_ylh=X3oDMTEwdnZjMjFh...gtY3Nz/s/233120

Buffett is saying this boys & girls. Maybe you'll listen to what he says.

Highlights:

- US could become a "sharecropper's society" where debt to foreigners rises to about $11 trillion by 2015. This would result in a debt payment to foreigners of about $550 billion annually by 2015 resulting in less investment & lower living standards.

 

- Greenspan believes weaker dollar makes U.S. goods more competitive. This ignores the fact that China & other asian nations operate on fixed currencies & as the world takes notice other developing nations might consider that route.

 

What can we do? Prioritize US manufactured goods & services over foreigners.

New regulation could make this happen. On-line any site selling goods & services would have to include a Made in America search function & prioritize US manufacturers in searches whereever possible. In-store it would mean retailers would not only have to guarantee US manufacturers shelf space but they would have to prioritize it so that it was the most accessible or first noticeable choice. If there was a clock radio out there that was made in America Walmart would have to find space for it & put it first.

 

It's not a big deal but it could make a substantial difference. If nothing else it would give Americans the ability to easily obtain that which is still Made in America. The American people would then have a real say in their future.

[southsider2k5]

Interesting to note, I was looking for specific by country numbers and couldn't find them. All I could find where numbers for January.

 

China is by far the biggest offender and that is mostly because of their pegging of the Yuan to the dollar. If we want a quick way to cut the price of oil, tariff the crap out of China so that the trade gap goes to zero. If you extrapalate out the $15.3 billion for one month, we are supplying China with $180 billion a year in surplus. And keep in mind that isn't the government either. That is WE the people as consumers that make up that number. That is also $180 billion in lost income here. They have been able to rev up their economy and increase demand for oil with our dollars.

 

Also interesting to note the next 3 biggest drains on the US economy are Japan, closely followed by Canada, and then Mexico.

[southsider2k5]

Also a much more educational blog post and comments

 

http://macroblog.typepad.com/macroblog/200...trad_defic.html

[Texsox]

What is alarming to me is all the money we borrow from around the globe. The same countries that would not send troops to Iraq, are happy to lend us money so we can go there ourselves. The rest of the world saves, while we spend and bankrupt ourselves. Bush and the GOP just keep spending and spending and cutting taxes. Let's all take pay cuts and max out credit cards! Then when the economy is "stimulated" we'll all make more money.

 

Don't let the government spend more than we send them.