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Friday, November 14, 2008

"Wal-Mart Trade Deficit"

For those that don't read Andrew Leonard's 'How the World Works', he always has interesting and insightful ideas. Yesterday's post regarding the U.S. trade deficit was no exception.

Here's a stunning number: The Census Department reported on Thursday that the U.S. trade deficit declined to its lowest level in a year, to $56.5 billion. But Calculated Risk observes that the bilateral trade deficit with China rose to an all-time high of $27.8 billion. Fully half of the U.S. trade deficit is accounted for by one country -- China.
He also noted what we have pointed to here at EconomPic Data... Walmart and other low-cost providers have faired much better (and actually thrived) as the U.S. consumer has struggled. How have they been able to keep prices so low?
In significant measure, by sourcing production of its goods in China. A rough estimate holds that fully 10 percent of the annual trade deficit between the U.S. and China is accounted for by one company -- Wal-Mart.