The document discusses the U.S. current account deficit and perspectives from various economists on its sustainability. It provides details on how the current account is calculated and its components. The deficit is seen as having both positive and negative impacts in the short and long run. Economists estimate the dollar would need to depreciate significantly, between 10-35%, for the deficit to be eliminated or reduced. The document also examines the largest trade deficit partner countries and steps the U.S. could take to control the situation.
A solution for the HBR case study, We Googled You. The hiring firm Hathaway Jones, seems to face a problem as they seem to have found a perfect candidate for solving their problems, but land in a fix when some unpleasant news is digged up by the HR regarding her past. WHat should they do?
A marketing Case Study of Natureview Farm, an organic yogurt manufacturer. This analysis was performed by E. Santhosh Kumar, IIT Madras, during an internship with Prof. Sameer Mathur, IIM Lucknow.
A solution for the HBR case study, We Googled You. The hiring firm Hathaway Jones, seems to face a problem as they seem to have found a perfect candidate for solving their problems, but land in a fix when some unpleasant news is digged up by the HR regarding her past. WHat should they do?
A marketing Case Study of Natureview Farm, an organic yogurt manufacturer. This analysis was performed by E. Santhosh Kumar, IIT Madras, during an internship with Prof. Sameer Mathur, IIM Lucknow.
Cola Wars - Coke Vs Pepsi Harvard Business School Case StudyMohan Kanni
A brief presentation on case study Cola Wars where we try to analyse the past history and predict the future of their business and growth opportunities from a Marketing Management Perspective.
This slideshow was created to showcase the marketing research involved in the strategic decision-making process. This presentation represents a decision for the marketing team at Barco Projection Systems, on how to combat the incoming Sony 1270 projector model. This presentation includes a brief history, situation analysis, options for Barco, and an ultimate decision based on this research. This Powerpoint presentation was completed for a Marketing Management & Strategy course.
Poorva Pandya
POLICY SEMINAR
Virtual Event - COVID-19, global markets and African agricultural trade: Impacts on growth and food security
Organized by IFPRI, with support from the United States Agency for International Development (USAID)
SEP 17, 2020 - 09:30 AM TO 11:00 AM EDT
Aqualisa Quartz - Simply A Better Shower (HBR Case Study)Arjun Parekh
Probable Solution to HBR Case on Aqualisa Quartz. The Presentation consists of info about Channel Distribution, Development of Quartz Shower Valve, UK Shower Market, Initial Sales Results, 4Ps of Marketing for Aqualisa, A shift in Marketing Strategy.
In April 2013, Procter & Gamble (P&G), the world’s largest consumer packaged goods (CPG) company, announced that it would extend its payment terms to suppliers by 30 days. At the same time, P&G announced a new supply chain financing (SCF) program giving suppliers the ability to receive discounted payments for their P&G receivables. Fibria Celulose, a Brazilian supplier of kraft pulp, joined the program in 2013 but was re-evaluating the costs and benefits of participating in the SCF program in the summer of 2015. The firm’s treasury group and its US country manager must decide whether to keep using the program and, if so, whether to keep their existing SCF banking relationship or start a new relationship with another global SCF bank.
Study the international Finance at the macro level. In this slide we will see the Current Account situation of several countries and Vietnam on focus (as of 2008).
In slide 2.2 we will see how to Finance the Current Account deficit.
Cola Wars - Coke Vs Pepsi Harvard Business School Case StudyMohan Kanni
A brief presentation on case study Cola Wars where we try to analyse the past history and predict the future of their business and growth opportunities from a Marketing Management Perspective.
This slideshow was created to showcase the marketing research involved in the strategic decision-making process. This presentation represents a decision for the marketing team at Barco Projection Systems, on how to combat the incoming Sony 1270 projector model. This presentation includes a brief history, situation analysis, options for Barco, and an ultimate decision based on this research. This Powerpoint presentation was completed for a Marketing Management & Strategy course.
Poorva Pandya
POLICY SEMINAR
Virtual Event - COVID-19, global markets and African agricultural trade: Impacts on growth and food security
Organized by IFPRI, with support from the United States Agency for International Development (USAID)
SEP 17, 2020 - 09:30 AM TO 11:00 AM EDT
Aqualisa Quartz - Simply A Better Shower (HBR Case Study)Arjun Parekh
Probable Solution to HBR Case on Aqualisa Quartz. The Presentation consists of info about Channel Distribution, Development of Quartz Shower Valve, UK Shower Market, Initial Sales Results, 4Ps of Marketing for Aqualisa, A shift in Marketing Strategy.
In April 2013, Procter & Gamble (P&G), the world’s largest consumer packaged goods (CPG) company, announced that it would extend its payment terms to suppliers by 30 days. At the same time, P&G announced a new supply chain financing (SCF) program giving suppliers the ability to receive discounted payments for their P&G receivables. Fibria Celulose, a Brazilian supplier of kraft pulp, joined the program in 2013 but was re-evaluating the costs and benefits of participating in the SCF program in the summer of 2015. The firm’s treasury group and its US country manager must decide whether to keep using the program and, if so, whether to keep their existing SCF banking relationship or start a new relationship with another global SCF bank.
Study the international Finance at the macro level. In this slide we will see the Current Account situation of several countries and Vietnam on focus (as of 2008).
In slide 2.2 we will see how to Finance the Current Account deficit.
This Presentation deals With:
What is a Current Account ,
Current Account Balance
Deficit In Current Account Balance.
Current Account Deficit In India,
Causes for Current Account Deficit,Impact Of Deficit,
India's Position.etc
The current account deficit that cried "wolf!"RBS Economics
The UK current account deficit hit a record 5.2% of GDP in 2015. Senior Economists Rupert Seggins and Marcus Wright take a look at what the current account deficit is, what has happened to it, why and what it does and does not tell us about the economy.
Provides an overview of the reseach of Ghosh and Ramakrishnan on current account deficits: what they are, how they are measured and whether they matter.
CAUSES AND CONSEQUENCESOF THE TRADE DEFICITAN OVERVIEW.docxcravennichole326
CAUSES AND CONSEQUENCES
OF THE TRADE DEFICIT:
AN OVERVIEW
March 2000
In recent years, the U.S. trade deficit has grown very large by historical standards,
prompting concerns that it is damaging or may pose a threat to the economy. The
Senate Committee on Finance asked the Congressional Budget Office (CBO) to carry
out a study of the trade deficit, its causes, and its effects on the economy. The
committee also asked CBO to examine the effects of various federal policies on the
trade deficit—especially those that might be considered to reduce or eliminate it.
This memorandum summarizes the results of that effort.
Bruce Arnold of CBO's Microeconomic and Financial Studies Division wrote
the memorandum under the direction of Roger Hitchner, Robert Dennis, and David
Moore. Helpful comments were received from Doug Hamilton, Juann Hung, Kim
Kowalewski, Preston Miller, John Peterson, John Sabelhaus and Tom Woodward,
within CBO, and from Paul Wonnacott of Middlebury College and Catherine Mann
of the Institute for International Economics. Jenny Au prepared the figures. Sherry
Snyder edited the memorandum, Leah Mazade proofread it, and Rae Wiseman
prepared it for publication. Laurie Brown prepared the electronic versions for CBO's
World Wide Web site (www.cbo.gov).
Questions about the analysis should be addressed to Bruce Arnold.
CONTENTS
INTRODUCTION AND SUMMARY 1
WHAT IS THE CURRENT-ACCOUNT BALANCE? 5
WHAT CAUSES THE CURRENT-ACCOUNT DEFICIT? 6
A Long Decline in Domestic Saving 7
The Business Cycle 12
Growth of Investment in the 1990s 12
DO INFLOWS OF FOREIGN CAPITAL HARM THE ECONOMY? 14
Effects on GDP, GNP, and Wages 14
Effects on Different Sectors of the Economy 15
Concerns About Foreign Finance and Economic Stability 16
SHOULD ANYTHING BE DONE ABOUT THE
CURRENT-ACCOUNT DEFICIT? 19
CONCLUSION 24
TABLES
1. Effects of Various Trade-Related Policies on the
Current-Account Deficit 21
FIGURES
1. The U.S. Balance of Trade, 1970-1999 2
2. Saving, Investment, and the Current-Account Balance 8
INTRODUCTION AND SUMMARY
Since World War II, the United States has supported agreements among nations to
eliminate barriers to international trade and investment. Despite occasional
resistance, that support has generally reflected a public consensus about the benefits
to be gained from free trade. Since long before the war, the United States had run an
almost unbroken string of trade surpluses—that is, an excess of exports over
imports—and the war damaged or destroyed much of the most significant
international competition for U.S. industry. Consequently, before 1970, U.S.
industry seemed to have little to fear and much to gain from free trade.
After 1970, however, the almost unbroken string of trade surpluses turned into
one of trade deficits, and in the 1980s and 1990s, those deficits grew quite large (see
Figure 1). Opponents of freer U.S. trade point to the deficits as evidence of mistaken
U.S. and unfair foreign trad ...
Branding & Packaging Designs by Tazeen AzeemTazeen Azeem
Mehak’s Kitchen is a hygienic homemade service food providers. Serving all types food cooked, baked or grilled under the neat & hygienic environment.
People with busy routine or working ladies who want to maintain their healthy diet can feel free to order from Mehak’s Kitchen.
Mehak’s Kitchen is composed of combination logo including text & symbol.
Logo concept was derived by Tazeen Azeem (Creative Desiger)
The promotional mix is one of the 4 Ps of the marketing mix. This presentation will equip the viewer with the importance of promotion and AIDA effects of each tool.
Its an assembled file of five different topics on Suicide in Pakistan, Corporate social responsibility, Crime & deviance, Social Class & Elton Mayo's Theory
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
USDA Loans in California: A Comprehensive Overview.pptxmarketing367770
USDA Loans in California: A Comprehensive Overview
If you're dreaming of owning a home in California's rural or suburban areas, a USDA loan might be the perfect solution. The U.S. Department of Agriculture (USDA) offers these loans to help low-to-moderate-income individuals and families achieve homeownership.
Key Features of USDA Loans:
Zero Down Payment: USDA loans require no down payment, making homeownership more accessible.
Competitive Interest Rates: These loans often come with lower interest rates compared to conventional loans.
Flexible Credit Requirements: USDA loans have more lenient credit score requirements, helping those with less-than-perfect credit.
Guaranteed Loan Program: The USDA guarantees a portion of the loan, reducing risk for lenders and expanding borrowing options.
Eligibility Criteria:
Location: The property must be located in a USDA-designated rural or suburban area. Many areas in California qualify.
Income Limits: Applicants must meet income guidelines, which vary by region and household size.
Primary Residence: The home must be used as the borrower's primary residence.
Application Process:
Find a USDA-Approved Lender: Not all lenders offer USDA loans, so it's essential to choose one approved by the USDA.
Pre-Qualification: Determine your eligibility and the amount you can borrow.
Property Search: Look for properties in eligible rural or suburban areas.
Loan Application: Submit your application, including financial and personal information.
Processing and Approval: The lender and USDA will review your application. If approved, you can proceed to closing.
USDA loans are an excellent option for those looking to buy a home in California's rural and suburban areas. With no down payment and flexible requirements, these loans make homeownership more attainable for many families. Explore your eligibility today and take the first step toward owning your dream home.
how to sell pi coins at high rate quickly.DOT TECH
Where can I sell my pi coins at a high rate.
Pi is not launched yet on any exchange. But one can easily sell his or her pi coins to investors who want to hold pi till mainnet launch.
This means crypto whales want to hold pi. And you can get a good rate for selling pi to them. I will leave the telegram contact of my personal pi vendor below.
A vendor is someone who buys from a miner and resell it to a holder or crypto whale.
Here is the telegram contact of my vendor:
@Pi_vendor_247
how can i use my minded pi coins I need some funds.DOT TECH
If you are interested in selling your pi coins, i have a verified pi merchant, who buys pi coins and resell them to exchanges looking forward to hold till mainnet launch.
Because the core team has announced that pi network will not be doing any pre-sale. The only way exchanges like huobi, bitmart and hotbit can get pi is by buying from miners.
Now a merchant stands in between these exchanges and the miners. As a link to make transactions smooth. Because right now in the enclosed mainnet you can't sell pi coins your self. You need the help of a merchant,
i will leave the telegram contact of my personal pi merchant below. 👇 I and my friends has traded more than 3000pi coins with him successfully.
@Pi_vendor_247
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
Even tho Pi network is not listed on any exchange yet.
Buying/Selling or investing in pi network coins is highly possible through the help of vendors. You can buy from vendors[ buy directly from the pi network miners and resell it]. I will leave the telegram contact of my personal vendor.
@Pi_vendor_247
how can I sell pi coins after successfully completing KYCDOT TECH
Pi coins is not launched yet in any exchange 💱 this means it's not swappable, the current pi displaying on coin market cap is the iou version of pi. And you can learn all about that on my previous post.
RIGHT NOW THE ONLY WAY you can sell pi coins is through verified pi merchants. A pi merchant is someone who buys pi coins and resell them to exchanges and crypto whales. Looking forward to hold massive quantities of pi coins before the mainnet launch.
This is because pi network is not doing any pre-sale or ico offerings, the only way to get my coins is from buying from miners. So a merchant facilitates the transactions between the miners and these exchanges holding pi.
I and my friends has sold more than 6000 pi coins successfully with this method. I will be happy to share the contact of my personal pi merchant. The one i trade with, if you have your own merchant you can trade with them. For those who are new.
Message: @Pi_vendor_247 on telegram.
I wouldn't advise you selling all percentage of the pi coins. Leave at least a before so its a win win during open mainnet. Have a nice day pioneers ♥️
#kyc #mainnet #picoins #pi #sellpi #piwallet
#pinetwork
US Economic Outlook - Being Decided - M Capital Group August 2021.pdfpchutichetpong
The U.S. economy is continuing its impressive recovery from the COVID-19 pandemic and not slowing down despite re-occurring bumps. The U.S. savings rate reached its highest ever recorded level at 34% in April 2020 and Americans seem ready to spend. The sectors that had been hurt the most by the pandemic specifically reduced consumer spending, like retail, leisure, hospitality, and travel, are now experiencing massive growth in revenue and job openings.
Could this growth lead to a “Roaring Twenties”? As quickly as the U.S. economy contracted, experiencing a 9.1% drop in economic output relative to the business cycle in Q2 2020, the largest in recorded history, it has rebounded beyond expectations. This surprising growth seems to be fueled by the U.S. government’s aggressive fiscal and monetary policies, and an increase in consumer spending as mobility restrictions are lifted. Unemployment rates between June 2020 and June 2021 decreased by 5.2%, while the demand for labor is increasing, coupled with increasing wages to incentivize Americans to rejoin the labor force. Schools and businesses are expected to fully reopen soon. In parallel, vaccination rates across the country and the world continue to rise, with full vaccination rates of 50% and 14.8% respectively.
However, it is not completely smooth sailing from here. According to M Capital Group, the main risks that threaten the continued growth of the U.S. economy are inflation, unsettled trade relations, and another wave of Covid-19 mutations that could shut down the world again. Have we learned from the past year of COVID-19 and adapted our economy accordingly?
“In order for the U.S. economy to continue growing, whether there is another wave or not, the U.S. needs to focus on diversifying supply chains, supporting business investment, and maintaining consumer spending,” says Grace Feeley, a research analyst at M Capital Group.
While the economic indicators are positive, the risks are coming closer to manifesting and threatening such growth. The new variants spreading throughout the world, Delta, Lambda, and Gamma, are vaccine-resistant and muddy the predictions made about the economy and health of the country. These variants bring back the feeling of uncertainty that has wreaked havoc not only on the stock market but the mindset of people around the world. MCG provides unique insight on how to mitigate these risks to possibly ensure a bright economic future.
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
The secret way to sell pi coins effortlessly.DOT TECH
Well as we all know pi isn't launched yet. But you can still sell your pi coins effortlessly because some whales in China are interested in holding massive pi coins. And they are willing to pay good money for it. If you are interested in selling I will leave a contact for you. Just telegram this number below. I sold about 3000 pi coins to him and he paid me immediately.
Telegram: @Pi_vendor_247
where can I find a legit pi merchant onlineDOT TECH
Yes. This is very easy what you need is a recommendation from someone who has successfully traded pi coins before with a merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi network coins and resell them to Investors looking forward to hold thousands of pi coins before the open mainnet.
I will leave the telegram contact of my personal pi merchant to trade with
@Pi_vendor_247
The European Unemployment Puzzle: implications from population agingGRAPE
We study the link between the evolving age structure of the working population and unemployment. We build a large new Keynesian OLG model with a realistic age structure, labor market frictions, sticky prices, and aggregate shocks. Once calibrated to the European economy, we quantify the extent to which demographic changes over the last three decades have contributed to the decline of the unemployment rate. Our findings yield important implications for the future evolution of unemployment given the anticipated further aging of the working population in Europe. We also quantify the implications for optimal monetary policy: lowering inflation volatility becomes less costly in terms of GDP and unemployment volatility, which hints that optimal monetary policy may be more hawkish in an aging society. Finally, our results also propose a partial reversal of the European-US unemployment puzzle due to the fact that the share of young workers is expected to remain robust in the US.
What website can I sell pi coins securely.DOT TECH
Currently there are no website or exchange that allow buying or selling of pi coins..
But you can still easily sell pi coins, by reselling it to exchanges/crypto whales interested in holding thousands of pi coins before the mainnet launch.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and resell to these crypto whales and holders of pi..
This is because pi network is not doing any pre-sale. The only way exchanges can get pi is by buying from miners and pi merchants stands in between the miners and the exchanges.
How can I sell my pi coins?
Selling pi coins is really easy, but first you need to migrate to mainnet wallet before you can do that. I will leave the telegram contact of my personal pi merchant to trade with.
Tele-gram.
@Pi_vendor_247
how to sell pi coins on Bitmart crypto exchangeDOT TECH
Yes. Pi network coins can be exchanged but not on bitmart exchange. Because pi network is still in the enclosed mainnet. The only way pioneers are able to trade pi coins is by reselling the pi coins to pi verified merchants.
A verified merchant is someone who buys pi network coins and resell it to exchanges looking forward to hold till mainnet launch.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
Abhay Bhutada Leads Poonawalla Fincorp To Record Low NPA And Unprecedented Gr...Vighnesh Shashtri
Under the leadership of Abhay Bhutada, Poonawalla Fincorp has achieved record-low Non-Performing Assets (NPA) and witnessed unprecedented growth. Bhutada's strategic vision and effective management have significantly enhanced the company's financial health, showcasing a robust performance in the financial sector. This achievement underscores the company's resilience and ability to thrive in a competitive market, setting a new benchmark for operational excellence in the industry.
Scope Of Macroeconomics introduction and basic theories
U.S current account deficit
1. THE U.S CURRENT ACCOUNT
DEFICIT
By: Tazeen Azeem , Muhammad Naveed, Sabaha Gul Khan,
Muhammad Saud, Farah Mazher ,Syed Anwar
2. It measures a country's
imports and exports of
goods, services
and capital.
It is in balance when the
people, businesses and
government have enough
income and savings to fund all
purchases occurring in that
country.
The Current Account:
7. The U.S Current Account Deficit
The Bureau of Economic
Analysis divides the current
account into four
components:
Trade
Net income
Direct transfer
Asset income
8. •It occurs when a country's
imports more goods and
services than it exports.
Trade-deficit
9. Net Income-deficit
•The income paid out by a
country's individuals,
businesses and government to
their foreign counterparts is
more than they receive, it
contributes to a deficit.
10. irect Transfers-deficit
•Wages sent back to a foreigner's
home country.
•Direct investments made abroad
by a country's residents.
•Bank loans to foreigners.
11. Asset income-deficit
•Loans made by foreign banks abroad to
domestic banks.
•Sales of the stocks and bonds to foreigners.
•Foreign direct investment, such as
reinvested earnings, equities and debt.
13. The Current Account is calculated adding up the
following four components,
1. Goods
2. Services
3. Income
4. Current transfers
14. Goods
Being movable and physical in nature, goods are
often traded by countries all over the world. When a
transaction of certain good's ownership from a local
country to a foreign country takes place, this is called an
"export." The other way around, when a good's owner
changes to a local inhabitant from a foreigner, is defined
to be an "import." In calculating current account, exports
are marked as credit (the inflow of money) and imports
as debit. (the outflow of money.)
15. Services
When an intangible service (e.g. tourism) is used by
a foreigner in a local land and the local resident
receives the money from a foreigner, this is also
counted as an export, thus a credit.
16. Income
A credit of income happens when an individual or a
company of domestic nationality receives money from
a company or individual with foreign identity. A foreign
company's investment upon a domestic company or a
local government is also considered as a credit.
17. Current Transfers:
Current transfers take place when a certain foreign
country simply provides currency to another country
with nothing received as a return. Typically, such
transfers are done in the form of donations, aids, or
official assistance.
18. A Formula for Calculating Current Accounts
CA = ( X – M ) + NY + NCT
CA is the Current Account.
X and M the Export and Import of Goods and Services respectively.
NY the Net Income from Abroad.
NCT the Net Current Transfers.
19. THE ECONOMIC IMPACT OF DECLINING
CURRENT ACCOUNT DEFICIT
In The Short-Run
A current account deficit is mostly advantageous.
Foreigners are willing to pump capital into a country to
drive economic growth beyond what it could manage on its
own.
20. THE ECONOMIC IMPACT OF DECLINING
CURRENT ACCOUNT DEFICIT
In The long Run
a current account deficit can sap economic vitality. Foreign
investors may begin to question whether economic growth
can provide an adequate return on their investment.
22. U.S. TRADE DEFICIT BY COUNTRY
TRADE DEFICIT
The U.S. has run a trade deficit since 1975. In 2012, the
deficit in goods and services was nearly $540 billion. This
means that U.S. exports of $2.194 trillion were less than its
imports of $2.73 trillion in goods and services
23. Bureau of Economic Statistics
International trade is measured by the Bureau of Economic
Statistics within the U.S. Census Bureau.
U.S. TRADE DEFICIT BY COUNTRY
24.
U.S. Trade Deficit in Goods
Then U.S. Trade Deficit in goods alone was $726.7
billion. That's because the U.S. exported $1.547 trillion in
goods, while importing $2.275 trillion. However, U.S.
exports have been strengthening compared to imports,
because the goods deficit was nowhere near the record
deficit of $828 billion set in 2006.
U.S. TRADE DEFICIT BY COUNTRY
25. World's Third Largest Exporter
1. EUROPEAN UNION ($ 2..17 trillion)
2. CHINA ($2.05 trillion)
3. GERMANY ($1.4 trillion)
U.S. TRADE DEFICIT BY COUNTRY
26. Three Different Criteria
IMPORT
Cheap consumer products
Oil
EXPORT
Agricultural products,
Industrial
Supplies
Capital goods
o IMPORT MORE THAN EXPORT
U.S. TRADE DEFICIT BY COUNTRY
27. COUNTRIES WITH THE LARGEST DEFICITS
AREN'T NECESSARILY THE LARGEST
PARTNERS:
Canada - $616.6 billion traded with a $31.8 billion
deficit.
China - $536.2 billion traded with a $315 billion deficit.
Mexico - $494 billion with a $61.3 billion deficit.
Japan - $216.4 billion traded with a $76.3 billion deficit.
Germany - $157.3 billion traded with a $59.7 billion
deficit.
28. TRADE DEFICIT WITH DIFFERENT
COUNTRIES
Trade Deficit With China.
Trade Deficit With Japan.
Trade Deficit With Germany.
Trade Deficit With Canada.
Trade Deficit With Mexico.
Other Trade Deficits Were Mainly Caused by
America's Need for Oil.
30. We are discussing five different point of
view the economist on sustainability issue.
The models used to estimate changes in
the dollar and CA are not empirically
derived; they are simulations based on
theoretical assumptions meant to be
consistent with reality.
Economist Review
31. Following are the economist those analysis we will
discuss,
• Economist Maurice Obstfeld and Kenneth Rogoff.
• Economist Olivier Blanchard, Francesco Giavazzi, Filipa Sa.
• Economist Sebastians Edwards.
• Economist Nouriel Roubini and Brad Setser.
• Economist Paul Krugman.
Economist Review
32. HAVE ESTIMATED HOW MUCH THE DOLLAR WOULD NEED TO
DEPRECIATE IN ORDER TO MAKE THE CA DEFICIT DISAPPEAR.
IN THEIR MODEL, SHOCKS TO AGGREGATE DEMAND OR
SHIFTS IN THE DEMAND OR SUPPLY OF TRADEABLE GOODS
COULD CAUSE THE CA DEFICIT TO DECLINE.
THEY ESTIMATE THAT THE REAL EXCHANGE RATE WOULD
DEPRECIATE BETWEEN 14.7% TO 33.6% IF A CA DEFICIT EQUAL
TO 5% OF GDP WERE ELIMINATED BY A CHANGE IN
AGGREGATE DEMAND, AND BETWEEN 9.8% AND 25.5%
IFELIMINATED BY A CHANGE IN THE SUPPLY OF TRADEABLE
GOODS. THEY ESTIMATE THAT DEPRECIATION WOULD BE
ACCOMPANIED BY A 3.9% TO 7.1% DECLINE IN THE TERMS OF
TRADE. THE PREDICTED DOLLAR DEPRECIATION IS SO LARGE
BECAUSE ABOUT THREE-QUARTERS OF U.S. OUTPUT IS NON-
TRADEABLE, PRODUCTION CANNOT BE QUICKLY SHIFTED
INTO TRADEABLE GOODS TO TAKE ADVANTAGE OF THE
DEPRECIATION, AND IMPORT.
Economist Review
1. Maurice Obstfeld and Kenneth Rogoff:
33. Explicitly allow asset demand to influence the exchange rate, and
they assume that assets from different countries are not perfect
substitutes. In their model, a CA deficit would eventually decline
because demand for U.S. assets is finite. Although an increase in the
demand for U.S. assets would initially cause the dollar to appreciate,
they argue, it would later depreciate to finance debt service (though it
would remain above its pre-appreciation value). They estimate that a
15% decline in the dollar would be associated with a decline in
the CA deficit equal to 1.4% of GDP.
2. Olivier Blanchard, Francesco Giavazzi, Filipa Sa
Economist Review
34. Edwards uses a similar model to simulate how much the dollar would
depreciate from its 2004 level depending on different assumptions about the
foreign demand for U.S. assets. Unlike Blanchard et al., he projects fairly
rapid declines in the CA deficit and dollar in the future. Under his optimistic
scenario, in which he assumes that the U.S. net debt will rise to 60% of GDP
by 2010 and then remain constant, the CA deficit would peak at 7.3% of
GDP in four years, before eventually declining to 3.2% of GDP (with most of
the decline occurring in the first four years after the peak).
If U.S does not control on the import and depreciated dollar to almost 28%
then U.S may face the rapid decline on the U.S CA deficits.
3. Sebastians Edwards:
Economist Review
35. Economists Roubini and Setser simulate what would happen to the
net foreign debt over the next 10 years under three scenarios. In the
first scenario,
Imports and exports continue to grow at historical rates. The CA
deficit would exceed by 12.8% from its current situation of GDP and
the net foreign debt would exceed 80% of GDP by 2012.
They estimate that the dollar would need to depreciate by about
10% from its 2004 level. All of these scenarios assume that relative
interest rates remain similar to past values as the net foreign debt
rises.
If foreigners demanded higher interest rates, then this would feed
through to a much larger CA deficit and debt path than simulated .
4. Nouriel Roubini and Brad Setser:
Economist Review
36. Economist Paul Krugman estimates that the dollar would need to
depreciate by at least 35% from its 2005 value in real terms in the
long run for the trade deficit to be reduced to zero . He looks for
evidence of whether this depreciation will happen gradually or
abruptly. For the depreciation to be smooth, Krugman argues that it
must be anticipated by rational investors, in which case they would
currently require a rate of return premium to hold U.S. assets (to
offset the loss suffered from the future dollar depreciation). To
determine how large the premium would have to be, he considers
two hypothetical paths for the dollar. In one path, the dollar declines
by 1.75% annually and net foreign debt peaks at 118% of GDP, or at
least one-third of the total U.S. capital stock.
5. Paul Krugman:
Economist Review
38. Effects
As usual in economics, there are several different
views of trade deficits. Depending on who you talk to,
they are
Bad,
Good,
Both (depending on the situation),
Immaterial.
Impacts of Trade Deficits
39. Bad Impact:
Borrowing from abroad
Selling off their capital Assets
Long Term Strategies
Future Production
Labour Union
Impacts of Trade Deficits
40. Good Impact
Good for United State Economy
Far from hurting employee
boost the US Employment
Impacts of Trade Deficits
41. Both
If a trade deficit represents borrowing to finance current
consumption rather than long-term investment, or results
from inflationary pressure, or erode U.S. employment, then
it's bad.
If a trade deficit fosters borrowing to finance long-term
investment or reflects rising incomes, confidence, and
investment—and doesn't hurt employment—then it's good
Impacts of Trade Deficits
43. IMPACTS OF TRADE DEFICITS
Impacts of Trade Deficits
US DOLLAR
• Panama
• Ecuador
• El Salvador
• Guatemala
• Bahamas
• Cambodia and
• Haiti
44. Impact on GDP
Most mainstream economists believe that because the
current account deficit is offset by foreign investment in
the United States, the effect on GDP is negligible. The
security of the U.S. economy and the U.S. dollar make
investments in U.S. productive capacity and in U.S.
corporate and government securities quite attractive. So
as long as the trade deficits are financed by foreign
investment and the dollar is not overly weakened by them,
then GDP will be fine.
Impacts of Trade Deficits
45. WHAT STEPS SHOULD BE TAKEN
BY U.S IN ORDER TO CONTROL THE
CURRENT SITUATION –
BY SYED ANWAR
46. THE FOLLOWING STEPS SHOULD BE
TAKEN IN ORDER TO CONTROL THE
SITUATION
U.S have to focus on their net Exports.
Reduce the volume of high Imports.
Nationals have to save money in their local banks, in order to
give boost to the economy.
U.S have to create demand for their Assets (such as U.S.
Treasury securities). all around the globe.
U.S must reduce their large expenses which they are
spending on the War.
47. U.S HAVE TO FOCUS ON THEIR NET
EXPORTS
It is witnessed that in the past few years U.S has
failed to create demand for their local product in the
international market. Now, if they build some
effective strategies in order to create the demand of
the local product their net export will be increased
in the near future.
48. REDUCE THE VOLUME OF HIGH
IMPORTS
It is known that U.S locals are extravagant and hence
the whole nation is considered as the spendthrift. In past
few years U.S started to import foreign products heavily
from different countries. By this very reason they are
facing trade imbalances.
49. NATIONALS HAVE TO SAVE MONEY IN
THEIR LOCAL BANKS, IN ORDER TO GIVE
BOOST TO THE ECONOMY
U.S are very much depending on the foreign investment
and the locals are not saving the money in the National
banks. Therefore U.S have to create awareness in the
country to keep the money the money in the banks in
order to give boost to the economy.
50. U.S HAVE TO CREATE DEMAND FOR
THEIR ASSETS ALL AROUND THE
GLOBE.
A number of analysts are concerned that the Asian
central banks would reduce their demand of U.S Assets.
Unleashing an abrupt collapse in the value of Dollar. U.S
should come up with some positive plans to over come
on this challenge.
51. U.S MUST REDUCE THEIR LARGE
EXPENSES WHICH THEY ARE
SPENDING ON THE WAR
At the moment U.S is spending a huge amount on the
war which is being fought in the different countries. If U.S
wants to reduce this C.A deficit then they must have to
cut down the huge expenses which they are incurring in
the Wars.
52. CONCLUDING
REMARKS
Never in the history of modern economics has a large
industrial country run current Account Deficit of the
magnitude posted by the U.S since 2000. These
development can be explained in the context of a
portfolio model of the CA, where for a number of
reasons- the end of the Cold War, foreign investor
increase their net demand for U.S Assets.