September Trade Balance Worse Than Worst Estimate; Trade Deficit With China Hits Record

Tyler Durden's picture

Despite the great shale revolution, US exports posted a $0.4 billion decline to $188.9 billion in October driven by decreases in industrial supplies and materials ($1.3 billion), other goods ($0.2 billion), consumer goods ($0.2 billion), and capital goods ($0.1 billion). This was offset by a $2.7 billion increase in imports to $230.7 billion broken down by increases in industrial supplies and materials ($0.9 billion); automotive vehicles, parts, and engines ($0.9 billion); capital goods ($0.8 billion); and consumer goods ($0.6 billion). End result: a September trade balance of $41.8 billion, which was higher than the highest forecast of $41.6 billion among 72 economists queried by Bloomberg, and the highest deficit print in 4 months.

The major deficits broken down by grography: with China $30.5 ($29.9), European Union $8.0 ($9.8), Germany $6.1 ($5.4), OPEC $5.9 ($7.3), Japan $5.5 ($6.4), Mexico $5.3 ($4.9), Canada $3.2 ($2.4), Saudi Arabia $3.2 ($3.6), Korea $2.1 ($1.7), Ireland $1.8 ($1.9), India $1.7 ($1.6), and Venezuela $1.3 ($1.5).

This was the largest trade deficit gap with China posted on record.

More 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 September exports of $188.9 billion and imports of $230.7 billion resulted in a goods and services deficit of $41.8 billion, up from $38.7 billion in August, revised. September exports were $0.4  billion less than August exports of $189.3 billion. September imports were $2.7 billion more than August imports of $228.0 billion.


In September, the goods deficit increased $3.0 billion from August to $61.3 billion, and the services surplus decreased $0.1 billion from August to $19.5 billion. Exports of goods decreased $0.2 billion to $132.1 billion, and imports of goods increased $2.8 billion to $193.4 billion. Exports of services decreased $0.2 billion to $56.8 billion, and imports of services decreased $0.1 billion to $37.3 billion.


The goods and services deficit increased $0.2 billion from September 2012 to September 2013. Exports were up $2.1 billion, or 1.1 percent, and imports were up $2.3 billion, or 1.0 percent.

End result: Q3 GDP forecasts are about to gap down by 0.2-0.4% points.

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uncle.bigs's picture

Huge trade deficits are bullish for the US economy.  It means that retail sales and imports are strong.  Trade deficit declined in the recession. Expanding trade deficit means economy is expanding.  LOL

waterwitch's picture

October's exports were only 2x monthly QE installment!

LawsofPhysics's picture

Scary.  Create all the credit from thin air that you want, the calories (energy) required to manufacture anything of real value cannot be pulled out of thin air.  It takes a lot of calories to maintain a modern standard of living, with 7+ billion (and growing) there is plenty of demand.

I remain long black markets and sharecropping.

LawsofPhysics's picture

The entire western world is being run by an oligarchy of a few families.  Like generations before them, they all go to the same schools, belong to the same fraternities and run in the same circles.  They know what is best for you, so don't question their wisdom or wealth.  Just get back to work serf and pay them their rent, forever.  Sovereignty in the western world is a myth, history tells us how that ends.

hedge accordingly.

Ying-Yang's picture

"This was offset by a $2.7 billion increase in imports to $230.7 billion"

Does this make AAPL terrorists?

Bearwagon's picture

Okay, I will not question their wealth. But they do not know what is good for me. I would trust you (that is: a stranger, thousands of miles away, who said a few clever things) much more. And that is exactly why I have quit work (for them) more than ten years ago, and I'm not coming back! I also do not pay rent to them. You may be ahead of me, LoP, but we both approach in the same direction. ;-)

GMadScientist's picture

Pioneered so many ways to degrade a human being
That it can't be changed to this day
Legacy so ingrained in the way that we think;
We no longer need chains to be slaves

Headbanger's picture

Wow,  that much huh?   Good thing we started making Twinkies again for the world or else we'd be in trouble.

And honest, I didn't see the above post about all the calories it takes to keep 7 billion people going when I wrote that!

Nothing but the truth.'s picture

And because America has lost it's manufacturing base , this trade deficit can only get worse. It beggars belief that succesive administrations have stood by watching the rapid loss of the manufacturing sector without response. That sector in particular , was at the heart of Americas economic fortunes, making it  the powerhouse of the world that it once was.

overmedicatedundersexed's picture

Nothing wake up, off shoring is the policy..a NWO and fundamental change have been spoken of by the puppets in DC for several years now. you might want to evaluate what the real aims of our masters are.

shovelhead's picture


The US still leads with Innovative Financial Products.

We are the Kings of Subprime.


disabledvet's picture

this is going to make creating inflation very problematic. obviously this puts massive default risk on the table while maintaining...incredibly in my view...the zero bound rate policy. this is total madness and it will continue. forget "families"...there are only a few industries paying for everything now.

MachoMan's picture

So...  america was supposed to maintain our exceptionalism in perpetuity?  Be the world's manufacturer forever?  Have a perfectly designed cage around our economy where only the good comes in and can never leave?

These comments on america's manufacturing base are no different than the comments regarding how awesome america was when the top marginal tax rates were much higher...  they're desperate attempts to find correlation...  well, correlation isn't causation. 

Yes, clearly, if you want any kind of economy then you'll need to produce something...  however, to expect the world to sit idle and not compete with us is naive at best.  The simple fact is that once the world was finally rebuilt after world war 2, america couldn't possibly expect to maintain its exceptional status.  We tend to blame everyone for this except the natural process of homogeneity.

Maybe you can get your wish and the rest of the world's manufacturing capacity can be destroyed so we can be great again...

Alpha Monkey's picture

It beggars belief that succesive administrations have stood by watching the rapid loss of the manufacturing sector without response.


Oh, there was a response... MOAR!  This is what happens when your kings listen to their high priests of economics.

daveO's picture

They swapped the factories for the FED's printing press. What a deal !!!

Cdad's picture

Yeah...strong retail sales...or building inventories.  You know...either or.  Of course, if you are paying attention to earnings is clear which one it is.

iLiquid's picture

Huge trade deficit is bullish because it means the US is efficient in exporting QE.

Besides, it further calls for more QE to be kept in the US, which means more QE.

Urban Redneck's picture

Exporting QE makes foreigners richer and Americans poorer.

Perhaps you were thinking of exporting inflation? Which of course increases the supply of dollars overseas which can be used as ammunition to wage economic warfare against the US Debt Serfs and their elected leaders...

Neither one is particularly desirable under current circumstances.

GMadScientist's picture

With more than a trillion in reserves parked by foreign banks, I think they can stop already.

Huge trade deficit is a thumb in the eye of any recovery story and while it's nice the 10% can still shop for trinkets to not celebrate the birth of their saviour, it won't end a depression.

LawsofPhysics's picture

China (and others) will increase treasury selling,  the Fed will start monetizing 100% (now at 70%) of new debt issuance. 

global trade will shut down

WWIII (in earnest)

Any questions?

Non Passaran's picture

Wasn't there a(nother) fancy conspiracy theory how Cina would export to the US in exchange for US property?
Which is right?

daveO's picture

Depends on whether we'll give them military bases.

NEOSERF's picture

Just wait til China starts exporting cars and parts.  If Goldman and the rest of the cartel would hurry up and collapse China's economy already, we could get on with taking over the world.

rtalcott's picture

Maybe Boeing will assemble the 777s in China now...

Boeing machinists reject labor deal on 777X by 67 percent
LawsofPhysics's picture

Why work when "value" can be created out of thin air?  Just ask ben bernanke.


yogibear's picture

Yellen will just stuff her face while increasing the QE lever.

orangegeek's picture

BDI fell 500  points in October - that's about 25% of the index.


.....yep, we are winning

Life of Illusion's picture


but but but,,,we got Penny Pritzker

Penny Pritzker will deliver a speech in Washington, DC on Thursday, November 14, 2013 to announce a new strategic vision and top priorities for the Commerce Department.

rtalcott's picture

What do you get when you cross a rhetorical question and a joke?

yogibear's picture

No problem Bernanke and Yellen can print more worthless IOUs to give to the China. Obama and his Chicago gang can laugh afterwards about the Chinese being suckers.

overmedicatedundersexed's picture

a lot of xmass shelve stocking in oct nov, imports in Jan will be lowest on record,

youngman's picture

But Obama promised us he was going to increase exports three fold I think...or was it fourfold...he would not lie to us would he...again

forwardho's picture

Re; US exports posted a $0.4 billion decline to $188.9 billion in October.

At a time when by majic creation, 85 billion is dumped into the financial system each month to keep the outright fantacy from collapsing into chaos.

$0.4 billion is a number of no consequence.

It only makes the point...

That all their busy rushing ends in nothing.


shovelhead's picture

QE creates shovel-ready jobs.

For banksters to shovel tons of crap paper under any rug they can find.

And still make a few bucks on the side.

This 'real economy' stuff is of no significance.

hangemhigh77's picture

Yellen's face always looks like she has to fart. That is on FUGLY bitch or a good looking alien.

Tabarnaque's picture

"Trade Deficit With China Hits Record"

So the question is: What will China do with all this fresh excess reserve of US dollars? Options:

a) They buy US treasuries to help the war mongers finance their war preparation against Syria (Iran). Yeh, right!... The Chinese should lend the USA money so that Washington can invade their allies and take away from the Chinese a major supplyer of oil...

b) They buy hard assets and commodities across the board as quickly as they can before the value of the US dollars goes down the drain.

Mmmmm, let me think for a while.


joego1's picture

If they don't dump them soon they will be wiping their ass with them.

orangegeek's picture


QQQBall's picture

If BA moves more work offshore it will be worse... what ewere the BA union members thinking?

Quinvarius's picture

I guess we stopped selling them our national gold reserves. 

Winston of Oceania's picture

The bitch with exporting your inflation is that eventually it comes back home as inflated imports after a while. What with all the dosh the sheep will be saving with no health insurance premiums it will be a cinch to cover the extra costs...

besnook's picture

a bigger trade deficit with china is a good thing. the economy is growing. good times are here, the deficit will be higher next month.

joego1's picture

Buy all the cheap imports while they are cheap. It's not gonna last forever.