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Worst Ever US Trade Deficit Excluding Crude Hints At Upcoming QE4
Remember that in a beggar thy neighbor world, where currency warfare has once again broken out between the US, Europe and Japan, for every winner there is a loser. In this case, the loser is the one country that has decided that a strong currency is a great thing for its economy (if only for the time being): that would be the US.
Why is this relevant? Because as the chart below shows, US trade excluding Petroleum, just crashed to $43.7 billion, the worst print in the history of the series, suggesting that portrayals of the US as a resurgent export powerhouse are completely erroneous, and that instead the US is as big a net importer of goods and services (and soon to be oil) as ever.
Biggest ever trade deficit (ex Petroleum)
The crucial point here is that with Shale production now expected to decline (if only modestly: after all those junk bond investors are desperate to keep the MotherFracking dream alive), the US will soon have to import more oil which will require more debt issuance to fund the soaring trade deficit which will require more QE to monetize the deficit.
And thus the stage is set for QE4.
One thing is sure - if the trade deficit surge continues, and Q1 GDP tumbles below 0%, the Fed will be right back at the frontlines, CTRL-Ping the US economy right back into "beggar thy global neighbor" competitiveness. Because as we noted, with Q1 GDP now assured a negative print, and with Q2 GDP according to the Atlanta Fed at 0.8% and likely going lower if there are several "unexpected" spring showers, the US may enter a technical recession as soon as June 30.
Hardly the stuff rate hikes are made of...
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No QE4 for you!
Cause the massive deflationary spiral ahead will slash Federal spending and thus the deficit
So not enough Tresuries issued for collateral for moar QE
DUH!
QE, Bondy Buying, and Money Printing were historically always precursor to big wars....
(Makes you consider the viability of all the military threats, yeah?)
Makes sense considering the Military Industrial Complex's appetite for destruction & perpetual war..
Anyway, is this all some econcomic war with China by chance?
http://wolfstreet.com/2015/05/04/china-containerized-freight-index-plung...
Well, they could also build taller dams out West with the money
But we already have a shit load of nukes paid off.
So yeah, a big WAR is more cost effective
BTW: DAX getting clobbered:
http://www.marketwatch.com/investing/Index/DAX/charts?CountryCode=DX
With the EM world facing a dollar shortage this is good ...... right ?
A liquidity crisis will make dollars moar scarce
But demand goes up for other currencies as well
So who knows.
LIES ALL FALSEHOODS LIES AND BAD SEASONALS. THEY NEED TO TIGHTEN LIKE A CHICKEN BEING CHOKED, RIGHT NOW. WE NEED MOAR PAIN. ROOT FOR THE BREADLINES BITCHEZ
No rate increase in June ?
In case you're wondering who is fighting whom;
http://www.independent.co.uk/voices/comment/robert-fisk-who-is-bombing-w...
Long bomb makers like Raytheon and Lockheed Martin
Zero Hedgers embarrass themselves with all these dumb references to MOAR (whatever the Fock that means) and "keep stack in', bitchez". It's ridiculous.
8 weeks 2 days...no further comment needed.
You should have just stopped at "the fourth stooge" for a user name.
Go suck Clappers scrotum trollbot.
nah, they're gonna raise rates soon. i heard it on bubblevision.
Oh, you just wait little mister.
vince, tell me a bedtime story, :)
we live by the $, exploit with the $, kill for the $.
it would make sense to print more and more and more.
'cause we got nothing else.
Good grief
Good thing we off shored most of our manufacturing and production of tangible goods and career employment - and import green card and illegal labor, eh?
Why...telemarketing, insurance sales, and burger flipping will save this great nation! Debt forever!
Notice that the unemployed youth in urban areas are pushed either into the: military, EBT F.S.A., or the corporate prison system,
QE4....LOL!
Once a junkie, always a junkie
And as I said before..."biggest miss since Lehman" is so 2014. Now to be replaced with "biggest ever" !
lol
And with biggest ever miss ? Dow 20,000 coming to a theater near you.
#Winning!
Worst ever!
Which is really means the best ever, because we will get MOAR... forever!
There can't be any problem with that, can there?
Got TO BE A MARKET RECORD ON THIS AWESOME NEWS!!!!
You guys have the sarcastic humor of lemming mentality & it's fooking hilarious... :D
please CNBC ... continue to roll-out these clowns who still believe the first rate hike is coming this year. only been wrong for the last 2-3 years regarding rate hikes, whats another year?
obama-keynsian-economics clearly defining "being in a box" with regards to this interest rate time-bomb they've created. can't wait til the last idiot light on her "dashboard" flashes INFLATION ALERT with regards to wage inflation (which was seen last week). they are running out of excuses although i did see 1 fed clown say they want to UP the inflation TARGETS now. ANYTHING to not HAVE TO raise rates.
oh wait, once the market sniffs out inflation, bonds will sell-off and rates will go-UP in their face. can't fuggin wait for that shit to spray against the wall. this # this morning was a flat-out mess for their "plan".
currency-wars on.
...once the market sniffs out inflation, bonds will sell-off and rates will go-UP in their face.
denninger? is that you? still waiting for bondzilla to wade into town? lulz.
Moar like bonds get sold off in a panic to cover horrible margin calls when equities implode soon.
Classic liquidity crisis dead ahead!
Relax the FED has our back they will soak up every last pos Bond if they have to. at least in our lifetime and I was born yesterday.
damn, we're priviledged enough to have karl denniger AND marc faber with us this morning?
uh, no. but what i do believe is that these clowns have created stagnation thru their policy of no fiscal policy but hyperbolic monetary policy. printing $$$ while raising taxes across the globe chokes growth and forces $$$ into asset classes it shouldn't be in. you do that long enough, and something has to give. i just hope they can keep it going long enough til i can die first. but hey, if you do believe this course they have us on leads to a happy place, i gotta bridge on the upper east side for a real good price.
hey guyz, hear that? aliki says buzzsaw99 thinks that current maggot policy leads us to a "happy place". omg lolololol
^^^
lol. i shud smack myself for discounting ur screenname
The others will lower their rates and the US can stay the same and claim a relative rate hike.
Then it will be business as usual.
Every time I hear "manufacturing is making a comeback in the U.S" I want to fill my Chinese made teevee full of wholes with some good old American made lead. Where is this manufacturing they speak of? Those hollowed out husks of a building lscattered throught the country? Fuck, even if we wanted to manufacture a product, getting past the bureaucracy is a major pain in the ass. We can't get anything moving here without some fucking special interest group fighting it. I don't want that ugly old building in my rotting decaying backyard, build it some place else. Americans are fucking stupid, and they clearly have a death wish.
Come on, paper manufacturing is doing extremly well in the USSA.
we make some of the best drugs ever developed....get your happy drugs like many of your fellow citizens (and illegals) and you won't care that we are bankrupt!
Caterpillar, GM, Ford, 3M.
Pull your head out of your ass.
Why don't you check out Ford's manufacturing plant out in Brazil, or Cat's 59 factories located outside of the U.S and get back with me. Oh, and go fuck yourself.
The future of manufacturing, not in the U.S. :
https://youtu.be/J1OkZ3xowKQ
how do you get from worst trade deficit to QE4? seems a stretch to me
maybe someone nice will explain it to you.
You do know that a "strong dollar" is a strain on exports right?
I get that a strong $ is a strain for exports but that automatically equates to QE4? the number is 43b in the grand scheme of things that's a pennies on the dollar.
Multiply that number times 12.
it is just one piece of the overall mosaic. watch and learn.
Not if you're betting on the yuan.
There's nothing fundamentally wrong with this economy, which is why equities have nowhere to go over the longer term except up.
You work in a factory that makes rose colored glasses?
Yes, if we could just get back to the heyday years of 2006 or 1999 when everything was healthy.
What is NeoLiberalism?
That's when Krugman gets Yellen to go up your FAFSA.
Someone better call Belgium.
But how did we import so much with all those W. Coast port strikes that "devastated" GDP in Q1??
You don't have to think too hard...read about the great depression and we are right on track. They did it through trade protection....we are choosing to do it via crazy QE currency destruction. Asset Bubble is fully built and the EFFEN geniuses on wall street think they are doing something useful collecting billions for failure. Sad, the end of an era for the US economy. Bernanke will be remembeered something akin to Chamberlain for WWII....laughingly courting obvious failure. How to do recover from a bubble...you build another rewarding the crooks that gave you the first!
QE4EVA!
Bitchez
"Bitchez"?
You're a blithering idiot.
^ Sheeple Arrived!
Further QE at this point would be worthless outside of keeping the stock market from falling.
The FED risks a total loss of credibility if they begin another round of easing.
People are slowly waking up to the fact that both QE and Keynesian economics are failed experiments.
We are seeing the final days of Central Bankster desperation. There is no out at this point except total collapse.
The U.S. economy is fighting headwinds, but it's still in a far better position than the vast majority of our competitors.
No, it's not smooth sailing ahead, but America is resilient and will continue to thrive and surprise to the upside. America's best days are still ahead of her.
Is your unicorn pink or puruple?
Get the fuck out of here trollbot
Tyler, I love your work! You often post great charts like this one without a source citation. Do you think you could please provide sources for your brilliant charts? It would further enhance your credibility and help people like myself assess the strength of your arguments,
Didn't you mean bugger?
"and that instead the US is as big a net importer of goods and services (and soon to be oil) as ever."
Don't need any charts for that. Just go to your local box store and see how much you can find made in the ussa.
A cool hundred million out of the labor force, corporations still off shoring production, on shoring cheap labor, it doesn't take a rocket scientist to come to this conclusion.
A powerhouse exporter, what a laugh, the only thing we export are dollars, bombs and hot air from DC.
The US is one bad mutha, watch yo mouth, I'm just talking about the US.
Is Cushing full yet? When will oil be $20?
Why would we ignore crude in the data? Is this going to be a new thing going forward?
Increasing energy prices are only going to hurt the middle class.
Who needs them?
The new economy doesn't need a middle class.
It only needs the government to lead the way.
Including all the QE Twists and Turns it's like QE 11.
The Bills of Lading were deferred being recorded due to the strike in Long Beach into one month - majr part of the change
how much of export sales were Boeing commercial and military hardware ?
i have one simple answer.
Instead of qe TARRIFS.
OF COURSE --the rockefellers will never allow this. but tarrifs could easily change all this. if the TPP fails, which is probably will not, the default is a reversal of the political internatoinalization trend. and that reversal means tarrifs.
Warren Buffet is reported to have suggested the use of import vouchers to reduce the trade deficit. He was quickly told to shut up, which he did. Such a system would require US importers to support their transactions with vouchers given to purchasers of our exports. This would, of course, violate WTO rules, in which case the US should reconsider its membership in the WTO, since that organization has always been used to the detriment of US interests.
QE4 is debt cancellation indeed.