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Trade Deficit Surges, Hits $50.2 Billion, On Expectations Of $44.1 Billion, Major Downward Revisions To Q2 GDP Coming
When we reported on the record surge in Chinese exports over the weekend we said that "the official read of the US trade deficit which will be reported on
Tuesday, will almost certainly spike, pushing GDP expectations lower yet
again." Sure enough, the US May trade deficit just exploded to $50.2 billion, far above the consensus of $44.1 billion, and much worse than April's revised $43.6 billion. Imports, not surprisingly, surged to an all time high $225.1 billion with exports lagging, even despite the relatively weak dollar in May, which declined modestly to $174.9 billion. From the report: "The U.S. Census Bureau and the U.S. Bureau of Economic Analysis, through the Department of Commerce, announced today that total May exports of $174.9 billion and imports of $225.1 billion resulted in a goods and services deficit of $50.2 billion, up from $43.6 billion in April, revised. May exports were $1.0 billion less than April exports of $175.8 billion. May imports were $5.6 billion more than April imports of $219.4 billion." Accoding to Bloomberg's Brusuelas, the key culprits were petroleum and industrial supplies. For those wondering what America exports and imports: "In May, the goods deficit increased $6.7 billion from April to $64.9 billion, and the services surplus increased $0.1 billion to $14.7 billion." So why do people care about the manufacturing CPI again? Bottom line: the bean counters will now be forced to revise their Q2 GDP forecasts well lower. And while Q2 is now a scratch, the problem is that this weakness is now continuing into Q3.
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And the Dow rallies...
the dow isnt rallying. the EUR is rallying. the dow is just hitching a ride.
At this point all markets foreign and domestic are just cheap whores willing to take anything in trade.
Oops, was that my out-loud voice?
It's a bit of a downer when the gold price is higher than the Baltic Dry...
maybe the fact that ALL SPANISH BANKS FAILED THE STRESSTESTS?
It must have been all Greek for them...
I-PADS saved us!!!!!!
That's gonna hurt the cheerleaders and other assorted enablers. It's not the fall that kills you, but the sudden stop.
Splat.
equity futures liked it.
If you trade using fibs, it wouldn't have mattered. futures will hit 1317 this morning on ES... this is what happens after a pullback to the 6.18 almost to the tick ... then you'll see a bounce to the 3.82, which btw is around 1317. After that we'll have to see if they retest the highs or go lower. The futures are heavily traded using fibs regardless of news.
Question for you (semi-serious) - if Fibonaci trading is a reliable investment strategy, then why aren't you and the other Fibonaci traders richer than Warren Buffet?
It seems that just last week technical analysis completely failed. The S&P was below a key moving average. The technical traders were expecting a test of the moving average and then a sharp leg down. Except it didn't happen. The S&P punched back through the moving average to the upside. If you had traded expecting a sharp leg down based on technical analysis you lost your ass.
Equity futures are full retard....never trade on full retard.
I think that FX guy (John Taylor) might be on to something.."By Q1 2012 we are going to be in a recession damn it!
Recession 2012.
Hang on, we haven't finished with 2011 yet...
2012 is a Depression...
2013, outright fail.
how does this work?
failpression, bitchez
meh... /shrug
I hear a big dump coming, honkies!
you mean bigger than a 3700 to 1 sell to buy ratio? Yikes, I should buy some more ammo.
Is there ever a point when you have enough?
Unlessyou have somewhere to cache it, just purchase enough to have on hand for the roving mobs.
When the .gubs come for it,you won't need any, if you do, your dead.
Door#1, or #2, which comes first.
$64k question............my money is on #2.
Distributed caches. Just use a vacuum sealer and bury a few.
PVC pipe makes a good storage container also.
Just leave one easy to find cache.
How long do you plan on living in your survival bunker? If the Mad Max world you envision does come to pass, you wouldn't be able to leave it because someone with a hunting rifle would shoot you, right? Have you calculated how long your food, ammo, water would last? And what do you do about sanitation? Are you just going to poop in a garbage can? That sounds lovely. Or is your survival bunker hooked up to the sewer system? Have you figured the chances of you going insane living in paranoid isolation over long periods of time?
RF is savvy enough not to answer your checklist of questions. But for reference, check out some of the hard core types here...
http://www.survivalblog.com/profiles.html
Umbrellas are useful before it rains, ED.
Have you figured the chances of you going insane living in paranoid isolation over long periods of time?
Sure beats watching TV which is all brainwashing of the sheep by the elites.
I have enough dead tree books to last a lifetime.
Add in hunting, fishing, planting and harvesting, and I really don't think I'll be all that bored.
Grab on with both hands...it's gonna be a growler!
Ouch... That's going to leave a mark.
Futures declined mildy on bad trade deficit, and now are up siginficantly. It must be the Berlusconi reassurances coming through at about the same time...
Futures 'up significantly' at -14 after yesterday -180? Im not so impressed with the retard futures myself, what is it 2005 all over again?
Winning the future(s).
There's a theme emerging here. Now let's see how the rest of today goes. Is that the smell of a Treasury auction burning? Or is it ES?
Recession is good for the market now....right?
I haven't been this bullish since April of 2008.
Rally on!!!!
LOL
The new worker monkey a la Linda Green. Where's Banzai7 when you need him?
^^Looks like a 2010 law school grad.
I wonder if he can pay back his student loans with three day old bread?
Just askin'
No, but he can go jack off at a nfp or government position and probably get them forgiven (on top of a mediocre salary, but probably no less than he would otherwise get starting out at a private firm)... of course, if he can't pay, then he can probably get a forebearance... and by the time he gets a job that will allow him to repay them, the market will have cleared and there will be no reason for the government to hold his feet to the fire (since it won't be around in the same form and shape and will probably have a new outlook on the world).
Are you jealous or angry?
Or both?
I'm not angry with those who utilize the system to their pecuniary advantage... I'm angry with those who change and grow the system to their pecuniary advantage... and, no, I'm not jealous... I'll take my position over needing a forebearance or having to waste my time at an nfp or government employer any day. If my situation was different, I'd hit them up for a job, just the same... but, thankfully, it's not.
What was the GDP of the US again?
It must be hard these day to calculate a new debt ceiling compaired to GDP these days...
ah ha SD,
therein lies the rub.....the US GDP number.
its all been a lie and all of the debt has been built on this number. therefore, from deductive reasoning, all the debt has been built on a lie.
the GDP calc is/has always been one of the main problems.
Bullish
Everything is safe again now, don't worry sweetheart you can get back in the water
but not near Japan...
And surprise surprise, equities go nuts. Recessions are bullish! What a joke...
Anytime now when apocalyptic movies are on such as "Deep Impact", "Armageddon", "28 Days Later", "Mad Max", "Knowing" etc, I sit there watching them thinking, I bet you the Dow was still rallying in those scenarios...
smooth transition of power from US to China...
relax...or try to
It's the end of the world as we know it. It's the end of the world as we know it. And I feel fine.......
US and Western product companies are in a death spiral. Because of bank and government overhead (and to a lesser extent labor costs) they can no longer afford to manufacture in the US and they can no longer commit infrastructure building assets in the Western World.
Western companies have become renters of manufacturing instead of owners... The Chinese and other Asian companies are the landlords and simply rent manufacturing (and we will see more and more R&D, financing and Engineering rented as well) just as poor people who cannot afford a down payment on a house rent from a landlord, who accumulates the profit as well as builds equity.
As the situation continues and Western companies borrow more and more to support the drain of money to elitist executives and to China/Asia the Western/US companies will slide down the slope of becoming hollow shells until one day people wake up and discover that they are better off buying from the source directly and forgetting about Intel, Apple, GM, GE and other companies that sold out the US first by choice for greed and then as a means to maintain executive (banker and politician) lifestyle at the expense of everyone else.
Swirley anyone?
The arguement of late seems to be between those who predict financial armageddon in the near-term, and those who see it coming in the mid-term.
I am new to the site and I don't want to seem jaded, but older threads have predicted the collapse before.
With complete sincerity and interest, I would like to ask the ZH community what the odds are of collapse by October 1st?
Collapse defined as 70% to 80% loss on equities.
The 'collapse' already happened a few years ago, just been papered over with trillions printed out of thin air while illusionists keep up their daily act.
Follow up question:
Do you think the surge in oil prices caused the collapse of 2008, or was it a sign of fractional banking leverage?
Put more simply was peak oil the tipping point?
Just a quick one WoodMizer, how do you know about old threads if you are new to the site?
I will admit I lurked since 2008; I was Laid off as a shop foreman in a cabinet shop, when real estate was kneecapped. I have spent most of my down time since 2008 taking a crash course in Austrian school econ. I became a member of the ZH community because I wanted to be able to ask some rather simple questions of an educated group.
Expensive oil and many other events are not the cause per se, so much as the straws that broke the camel's back so to speak... for example, a resilient populace (with savings) could have better withstood expensive oil and other increases in the cost of living. In many respects, these issues are more accurately described as symptoms of cheap credit/devaluation of our currency... (obviously at some point purchasable oil runs out, but it didn't in 2008 and this wasn't the predominant issue).
The real issues are decades of offshoring combined with a desperate attempt to paper over the problem and then an even more desperate attempt to create financial instruments and means to stuff a bandaid on the failed paper-over... the expansion of the size and scope of governments at all levels being a glaring example (picking up the slack of the private sector)... and their capture by those hell bent on ensuring the rest of us have to bow before breathing. Ultimately, this has created a hole so big even god could not fill it (especially when "he" doesn't exist) and we are impotent to collectively deal with the problem, given the respective position of stakeholders and our form of government. Like virtually all personal deleveraging to date, the only way we'll collectively deleverage is if forced.
In short, I think you might say that the boom post WW2 was more of a transitionary event than fixture... and eventually wage arbitrage won't have such an easy time... but until that day, we're going to experience decreases to our standard of living. And there is no end in sight... [even if the system resets... even if we adopt stronger money principles... we have to come to grips with the world economy and structural unemployment, unless of course a few billion people die off... (which is the desire of some... assholes)].
PS, don't worry about timing the market... it's a fool's errand and odds are you'll be wrong... and being wrong, even by a little, can bite you. Convert your currency out of the ether and convert to the new currency regime once it fires up... just remember, some assets depreciate more quickly and/or have less utility than others.
Why do we need unemployment? If we don't let people starve we have to spend money on them, or in other words wealth redistribution ... if we're being socialist why not create non oil consuming service jobs for them or spread the work around more? (Shorter working hours.)
Thanks for offering your synopsis.
Are you saying that since WW2 the industrialized world has been living beyond their means?
I'm saying america certainly has... but, if truth be told, the event horizon was probably long before that... there are fundamental aspects of our lives that will never be sustainable, despite however cleverly they may be disguised due to rampant credit, currency devaluation, or demographic factors... people see wage arbitrage as some sinister plot... I just see it as the unveiling of unsustainability. [as trav points out, the sinister plot is more told in what is done with the residual from utilizing wage arbitrage, e.g. bonuses for the top].
I will admit I lurked since 2008; I was Laid off as a shop foreman in a cabinet shop, when real estate was kneecapped. I have spent most of my down time since 2008 taking a crash course in Austrian school econ. I became a member of the ZH community because I wanted to be able to ask some rather simple questions of an educated group.
I will admit I lurked since 2008; I was Laid off as a shop foreman in a cabinet shop, when real estate was kneecapped. I have spent most of my down time since 2008 taking a crash course in Austrian school econ. I became a member of the ZH community because I wanted to be able to ask some rather simple questions of an educated group.
you can say that again...
oh, you did.
Good for you in taking an active interest in the systemic causes of your unfortunate loss of employment. If everyone who was affected by the 08' collapse maintained a similar character to yours, i would contend we would be in a much better place right now.
Thanks for the support.
One of the most challenging problems I face is convincing the older members of my family (60 and over), to diversify into PMs.
I graduated in 2006 with a BS in Biology, as a result my family considers me ignorant concerning macro economics.
I want to spread the ZH message, but the masses lack the prerequisites for understanding the importance of ZH articles.
Don't have such a contempuous view of the "masses"... everyone is perfectly capable of understanding virtually all the major issues... I'll posit that we're incentivized, whether extrinsically or intrinsically, to ignore the issues and/or create an alternate reality. The trick to getting them to see the light so to speak is to break through the protective barriers... and stay after them...
You got that right.
I call it "trying to have a 5th floor conversation with someone who is too lazy walk up beyond the 2nd floor."
Don't waste your time. If you care about them them, then prep enough for them as well as yourself. Otherwise, just let them go if they won't listen.
In my opinion, the collapse of 2008 was caused by the fact that our economic system relies on an ever increasing level of debt and leverage and (before the government jumped in with both feet) in 2008 private sector debt reached saturation. The collapse itself was caused by a panic reaction to that realization. Basically, the players realized the Titanic had hit an iceberg and rushed for the lifeboats all together.
Without 3 trillion in brand new dollars, not to mention Euro's, Pounds and Yen, it did collapse.
utterly...
TPTB have kept the ponzi scheme going this long. What's a few more months then? Prepare for the day your money buys nothing.
The algos are pushing the futures up to get a better ask on the open of the regular market, or somebody has a private relation with LaGarde and just got some inside info on Greece and Italy, today's toxic twins.
I wouldnt bet on it myself, but throw down your chips have fun.
Trading this market day to day is for the chronically ill person. Down, up, down. Just sitting here with my stash and miners.
Fuck paper.
I don't want to spoil your party.
BUT
What about the nuclear power plant at Fort Calhoun that is currently under water ?!
There is rumour about a meltdown.
A no-fly zone has been put in place as well as a total news ban.
Incommunicado.
Oh Franken nevermind all that, what are you busting out of the Matrix or something? Only thing that matters is STOCKS, and BTW have you eaten your peas yet?
what about japan, the mideast, pakistan etc. news stations are handed what news to report on, no investigative news allowed. what you do not hear, does not exist!
....ravenous bugblatter beast of Troth, which assumes that if you can't see it, it can't see you
Hitchhikers guide.
The axiom that the news you are not told is often what is most important remains true. What is the "news," as you are provided it, after all?
Geez, Frank, time to stop flogging that horse. A new barrier has already been installed around the plant and they're pumping it dry as we speak.
http://www.therepublic.com/view/story/50f41892dc5b4c12a6dd962b9de5c916/N...
My wife is currently in Omaha, and the news this weekend had new video of the plant showing all the important areas are dry and safe and have been all along. No meltdown since the pumps for the spent fuel pool are still working and the reactor core itself has been shut down for months for refueling.
The plant was already in cold-layup since April, well before the floods hit. They are good to go.
A VERY different scenario than Japan who was running high and hot when the quake happened. Controlling the reactor immediatley after a scram without electrical is a guaranteed disaster if you have no sustainable emergency means of removing heat. This is why they suffered meltdowns.
After looking at the futures, I had a vision of a couple of guys high-fiving it yelling, "Excellent. Highest in three years!"
Naz was already at all-time record highs two months ago. People keep forgetting
NYSE data from last quarter shows trading volume is 75% 'program trading' (Bots), 15% daytraders and only 10% 'investors'. That's a tell. It means that market valuation is a reflection of Fed liquidity provided to Wall Street, not a reflection of the economy or the health of corporate America. US economy is still over-financialized and that vicious cycle will continue to feed on itself.
Did we actually import an extra $50B in goods or was it the same amount that just costs more?
It's all measured in dollars, not dry weight.
The trade gap jumped 15% compared with April. Exports shrank and imports grew in terms of dollars. Clearly we're getting less at higher prices
What 'goods'? What do we make and export anymore?
9 mil, 7.62... and a few cars I think...
but maybe they're made in China...
Twinkies...
Movies
Armaments, ordinance
Inflation?
One plane and a shitload of soybeans. Work at the soybean factory has really picked up!
Coca Cola...
or is that made in China too?
and airfreight pallets of US Dollars to keep all those corrupt despots and US puppet Govts propped up abroad ..."bringing democracy to the world" ...just great wholesome stuff
I cannot believe that the brainless executives of the idiot channel allow Cramer on before lunch. He is so obnoxious, so clueless as to make me go to Bloomberg and Betty. I stopped watching this channel over 2 years ago except for the morning Santelli and Mark Haines, now that Mark is gone :(, with Cramer on it is just impossible to watch except on mute.
What a waste. Who the hell is in charge of this fraud.
Looks like a good day to do nothing.
Equity markets are now just a Treasury full-retard game....never trade full-retard.
High flyers like NFLX, AAPL, etc. are green this morning as they are trying to U-turn stocks to burn the late shorts.
Meanwhile, silver continues to get smashed, but now it is being dragged up kicking and screaming with the bounce in ES.
Gentleman Jim sending Momo a blood puke bucket.
meanwhile, as the robotard likes to bray, std continues to get smashed. std, for those who care, was the 'tard's number one pick from december 2010. it's down 20%.
You can bet that U.S. manufacturers who haven't already moved to China are rushing there now. They want to get in before the Renminbi skyrockets against the dollar.
we must have run out of gold to export.
Massive monthly trade deficits...
Massive annual budget deficits...
Massive federal debt level...
Massive outsourcing of American jobs and downward pressure on wages...
Massive debasement of US dollar through money printing...
Great job, elites! The experiment has failed.
+10
Failed? I would wager that many elites would argue their plans have succeeded smashingly well.
Their experiment failed the people. I don't care what elites would argue. I am not one of them, and I am not served by them.
not served by them but sure sucked dry by them
they've gone from robbing their banks to robbing the country.. pretty near complete i'd say
HELP...
Any good short sells to input today?
Isn't this what the Feds want? Public spending money they don't have on imported shit. Dow thinks it smells like recovery. More like an open manhole cover too a cesspool. Back to the party everyone.
That chart is really good as it shows that the import-export gap is getting wider while both imports and exports are increasing.
How about a chart showing the import-export gap as a percentage of exports ?
proving once again the lie that is a tanking currency "helps exports"
it's more obvious that a country who has a negative trade imbalance and imports more goods than it exports is going to suffer even more if imported goods cost more
no worries, Obumma has promised to double exports over the next 5 years.. maybe the peanut brained Press can ask the President of Shams how this throw-away trigger line is doing?
dub' post ...3rd today, Dejavue Virus Alert!
tariffs tariffs tariffs if washington had not sold out to the CFR and big banks who could care less about jobs in USA. visas to the moon, illegal immigration, all on fire but to do something would insult the elite scum who run this place. lay offs will continue until a real American patriot gets into office and puts an end to the free trade suicide pack.
Today is a perfect snapshot of the US circa 2011:
Market (and Wall Street) right under all time records just set this spring.
Main Street languishing badly and sinking into the quicksand as GDP sours, inflation creeps up, unemployment swells and housing is not recovering.
No worries Ben can just can just print more $ and without inflation. We just need countries and investors to continue to lend us $100 Billion every month ( and perhaps $150 Billion a month soon ) and everything will be just fine ;)
km4 they will for it keeps their people employeed..they go stronger we fall lower
revolutions were made of less. one day the bill will come due.
They have been doing it for over 3 decades ... sure the twin deficits are unsustainable, but they have always been unsustainable. There's nothing particularly special about the current situation which can't be helped by piling on more debt faster. As long as China and the oil producing countries are willing to lend the charade can keep going ...
The problem is the debt has always been piled on the middle/lower classes, and they're getting kinda sick of debt. Without them the only way to keep the game going is to pile some debt on the upper classes as well. Which is the one thing government doesn't want to do, piling on future debt obligations on the poor to keep the status quo going is one thing ... but the rich need their money, they are preparing for the collapse after all.
This is why social security cuts are now on the table ... wealth distribution from future poor to current poor to drive overconsumption ... perfect way to sustain the status quo a little longer.
And chances very high that S&P will close up today..
I think Barry needs to do another press conference and tell us to eat our peas so we can improve our trade deficit
Peas be upon you, POSOTUS.
Another day to explore copper jacketed futures.
All Chinese imports are coal/oil in other forms.
Add the Chinese imports to the crude imports and the guzzling beat goes on.
Now the analysts are cryin' b/c of the trade deficit. But we can't shrink in w/o cutting back on the guzzling.
What does the US export? Food commodities (oil and gas), airplanes (oil-gas, waste enablers), autos (oil- gas, waste enabler), some energy commodities such as diesel, coal (US runs a net energy deficit) ...
We re-export what we import! No matter what, the US chases its tail, beating itself over the head with a hammer then whining about the headache. Yes, indeed, we will bankrupt ourselves with our trade deficit. The trade deficit is just the indicator on the US 'bankruptcy gauge'.
Difference between July 12, 2011 and July 12, 1999 is that we can now see the light at the end of the energy tunnel, the train heading straight toward us with nowhere for us to run.
I hope you enjoyed your drive to work this morning ...
a lifting of the self-imposed domestic energy self-sufficiency ban could change this overnight. Let's hope Salazar plays in traffic while very drunk soon.
Assuming the US could switch to full domestic production right now, how long would Alaskan oil reserves last?