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US Trade Deficit Soars In December As Strong Dollar Hurts Exports, Downward Q4 GDP Revisions Imminent
And so after that epic 5.0% Q3 GDP print, driven largely by Obamacare, the payback begins, and the annualized Q4 GDP print, which came in at nearly half the previous quarter run rate, or 2.6%, is about to tumble by another ~0.5% following the just released trade data for December which saw a 17.1% surge in the US trade deficit from $39 billion (revised to $39.8 billion) to a whopping $46.6 billion in December, the widest deficit since 2012, as US exports declined 0.8% to 4194.9Bn from $196.4 Bn, while imports rose notably from $236.2Bn to $241.4Bn in the month before. All of this brought to you courtesy of the soaring USD. This was also the biggest miss to expectations of $38.0 billion since July of 2008. If this does not force policymakers to reassess the impact of the soaring dollar on US trade, nothing will.
Finally, if and when the US shale boom ends, and the US is forced to once again import the bulk of its oil needs from abroad, watch as the US deficit surges in the coming months and years, which incidentally is precisely what the Fed needs: after all in order for the Fed to monetize US debt, the US needs to issue debt to fund its deficit, which now has no choice but to go far wider from recent levels in order to restock the available stock of US Treasurys.
The trade deficit broken down by key trading partners:
- China: deficit of $28.30 billion, down from $29.94 billion as the USD peg is also impairing Chinese exports.
- EU: deficit of $15.1 billion, a surge from $11.8 billion thanks to the plunging EUR
- Japan: deficit of $5.7 billion, in line with November's $5.52 billion
For those curious about the petroleum trade, US petroleum imports rose to 313.3m barrels in December, at a value of $23.2 billion. Crude oil imports increased to $18.2b from $15.7b last month, representing 78.4% of total petroleum imports. December non-crude petroleum imports widened to $5b from $4.3b m/m; 21.6% of total petroleum imports.
And something curious: US crude oil imports averaged 7.980m b/d in Dec. compared to 6.296m b/d in Nov., a substantial jump and one which would have been the result of a drop in domestic production, if indeed domestic production were dropping instead of rising. So the increase is confusing on the surface.
The breakdown of imports:
- Oil imports from OPEC rose to 38.2% of the total
- Oil imported from Canada and Mexico was 51.9% of total in Dec. vs 52.0% in Nov.
Bottom line: expect the sellside crew to unleash a barrage of downward Q4 GDP revisions any second.
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Market up 500 points!!!!
So glad to hear everyting's going well. My regards to your central planners. Don't stay in touch.
awk awk awk it's Bush's fault, awk awk awk
Jeb or Hillary will get us out of this.....don't care which.....it's the same thing.
Bullish!
Algos scanning headlines will interpret this as Americans going on a massive spending spree for imported goods.
judging by the futures you are correct.
Just how can you NOT run a deficit when the only thing you export - weapons - are either given away for free to ISIS, Israel, Ukraine or against Shekel and Hryvnia?
NO.
Just NO fucking more, ok?
NO MORE BUSH's and CLINTONS.
Name one time in human history when a centrally planned economy failed. This is better for everyone involved and I for one can't wait for the outcome. Seriously a strong centrally planned economy backed by a large domestic police force with near unlimited power and spy agencies that can help assist the doubtes to stay the course. This is going to be really great.
there goes our waste paper export industry. soon, china will want real money for that phony plastic crap.
No, no, no. Our waste paper export industry (US Treasuries and Dollars) moves INVERSELY to our trade deficit. Deficit up, waste paper exports up. God help us if we ever ran a trade surplus. The entire industry would be wiped out.
BTW guys, real waste paper.... stuff to be used for recycling and repackaging iCrap and the like is in fact one of our largest exports form west coast to Asia. Duh... Interesting but probably totally useless factoid for you guys to walk around with in yer' noggins.
Thanks. Who couldn't use more useless trivia these days? I'm constantly trying to find the point at which my brain will fill up and start overwriting earlier information. Like childhood memories or the first time I got laid.
I'll one-up you there knukles - the Entire 'recycling' industry in the U.S. would be Non-Existent without export to Shenzhen and other places in that corner of the globe. Paper, plastics, tin, metals, electronic scrap, etc., All of it... The Do-gooding green shit and all of the government-funded, feel-good Crapola that follows it, would literally disappear overnight were it not for Chinese demand.
"For those about to [call the end of QE].....we salute you!"
Mega Bullish!!!
Nah, this is Gigabullish.
moar good news and it would be worse if those ships sitting off shore in LA would get off loaded..oh wait MSM will ignore the obvious ..shut off your tv's they are insane liars making fake news..(b williams of was it nbc?)
Was that Q4 EU deficit increase due to buying more non-offensive offensive weapons for our Ukie friends?
Cookies? Nudelman probably rolls with the "buy local" meme.
pods
I'm gonna have a heart attack from the size of that surprise - Iago (Aladdin)
Everything is AWESOME! BTFD!
How do I buy the trade deficit dip?
O yeah...just go long stawks. Silly me.
what dip? futures are up 15 on all the wonderful news we've gotten the last 18 hours.
BTFATH then. Just buy stawks. All the cool kids are doing it.
Off Topic Alert: "The White House Won’t Reveal Who Attended Obama’s Secret Meeting With Muslim Leaders"
The comments and pictures in the comment section are a riot.
http://www.breitbart.com/big-government/2015/02/04/the-white-house-wont-...
"And this is my dog, he's hypoallergenic."
"Is there enough for all of us?"
#DontEatPets
Maybe they all signed in as: "Beardsly McTowelhead"?
credit: Archer, who works for ISIS coincidentally.
Oil import is interesting story. Clearly EIA lying about USA oil production, overstated
month to month import numbers fluctuate greatly and are influenced by a number of factors. 10% - 20% swings are common based on shipping, reporting, etc.. one month's figure is indicative of nothing.
I am waiting for it to hit Boeing..that high dollar has to make the planes more expensive than the Airbus planes....by alot I would assume.....Cat and Deere are the most expensive anyway...they just got more expensive...
So a strong currency is no good for trade.......
Blahh, Ha, Ha, Ha,,,wait a minute, Obama said the chrisis has passed. What a dumb shit.
His crisis has passed and he plans to be the richest president ever. Wall Street and billionaires are going to shower him with millions...he will make Gore look like a piker
He also said, in reference to Cuba, that sanctions don't work. Except for those against Russia, I suppose. What a duplicitous shit.
This bleeding never stops.
God damn republicans!
US economy in a nutshell:
https://www.youtube.com/watch?v=6M17aG_Po2Y
3 ring shitshow!
USD Strong stocks Up, USD Weak stocks Up. Bond Yields Down Stocks Up, Bond Yields UP stocks Up. WTF!!!! Greek matters?? YES? #&@#&@#!!!
Start stuffing channels overseas.
It worked for GM and it worked for Apple.
Why not the US GDP?
And something curious: US crude oil imports averaged 7.980m b/d in Dec. compared to 6.296m b/d in Nov., a substantial jump and one which would have been the result of a drop in domestic production, if indeed domestic production were dropping instead of rising. So the increase is confusing on the surface.
Curious, seriously? Think dumping in order to support the oversupply narrative. Why would imports increase unless the prices offered were well below market?
This obviously can't continue. Storage space will be at a premium. Expect a fall in 1st quarter oil imports. Unless the economy is just that strong (which it isn't).
The last EIA weekly Petro data shows a DECLINE in weekly production, gas demand accelerating, refinery runs steady yet a huge inventory increase again? Where did this inventory come from I ask? Not from US production. I also want to add the Alaskan produciton was DOWN year over year while non-Alaskan was soaring over 12% year over year which by coincidence is estimated vs actual data from EIA....Tyler wake up and start looking into this.
Bullish. So fucking bullish.
Confusing. So fracking confusing.
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