rising consumer demand is flowing to suppliers overseas
Meanwhile, China is mopping up demand everywhere you
what look with its artificially cheap supply of goods. Germany, the world’s other exporting power, is cutting its budget and relying on foreign demand to drive its economic rebound. This isn’t sustainable.
The bulging American trade deficit means that rising consumer demand is flowing to suppliers overseas rather than fueling growth at home. The American economy is too weak to carry this load. The recent trade data led economists to slash growth estimates for this year.For the global recovery to continue, domestic demand must revive around the world. Other leading countries must do more to stimulate their own demand. And China cannot keep hogging the global export market.
The numbers are staggering. The United States trade deficit ballooned to $49.9 billion in June, the biggest since October 2008. In July, one month later, China recorded a $28.7 billion trade surplus, the biggest since January 2009. In the first five months of the year, Germany’s trade surplus, driven in large part by demand for machine tools in recovering Asian economies, rose 30 percent compared with 2009, to about $75 billion.
