Mornings session is set to tank the DJIA 180 points. Yesterday’s FOMC did little to provide confidence in QE support for the economy. The simple fact of extending Treasury purchases will not entice everyday Americans to purchase a home if confidence isn’t embedded into the workforce population. Many fear of losing their jobs.
In other news the trade trade deficit further exahaberated losses. The U.S. trade deficit widened a surprising 18.8 percent in June on a surge of consumer goods from China and other suppliers, while U.S. exports fell, a government report showed on Wednesday. The monthly trade gap totaled $49.9 billion, the highest since October 2008. The deficit was wider than any of the 67 Wall Street forecasts collected before the report.
U.S. imports of goods and services grew 3 percent in June to $200.3 billion, the highest since October 2008, in a show of strengthening domestic demand. Imports of consumer goods hit a record $43.1 billion and imports of non-petroleum goods were the highest since August 2008. Imports from China soared to $32.9 billion, the highest since October 2008. The closely watched U.S trade deficit with the East Asian manufacturer widened to $26.2 billion, also the highest since October 2008, while U.S. exports to China fell slightly. The big jump in the U.S. trade deficit follows Chinese government data on Tuesday that showed China’s trade surplus surged to $28.7 billion in July, an 18-month high.
The desperate trade data is likely to intensify calls in the U.S. Congress for China to move more aggressively to raise the value of its currency against the dollar. China loosened the yuan from a nearly two-year peg to the dollar in June, but it has barely risen since then. Many lawmakers believe it is undervalued by at least 25 percent. U.S. imports from Germany and the 27-nation European Union also had their best showing since October 2008. Overall U.S. exports fell 1.3 percent in June to $150.5 billion, their worst showing since April 2009.
We need to create jobs and a new technology or sector to spur growth as the Internet age of the 90′s. Will it be Nanotech or the push for a Green economy such as solar panels, electric vehicles, or lithium batteries. We shall see our primary concern is to back stop further job losses and create cheaper education to get the ball rolling.
SOURCE: WALL STREET GRAND JOURNAL.
