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Just as America has lost every major war it started—from Korean War, to Vietnam War, from Afghan War to Iraq War—so too has the great world power, “We’re #1, “The Exceptionals” lost the Trump Trade war that he loudly launched against China when he won the 2016 Presidential Reality Show® U.S. election.
The U.S. trade gap hit $89.19 billion, dipping a tiny bit from January’s record monthly chasm of $89.23 billion… but still notching the second worst imbalance on record, the U.S. commerce department reported.
Imports rose 1.3 percent to $317.8 billion, while exports gained 1.8 percent, totaling $228.6 billion.
Exports of industrial supplies, including fossil fuels, increased by $1.7 billion in February. Export of COVID vaccines added $1.3 billion.
Oil imports grew by $1.9 billion and other chemicals by $1.2 billion.
Vehicle imports sank slightly on global shortages of materials, especially computer chips.
TREND FORECAST: The U.S. trade deficit will continue at or near a record clip not only while the Ukraine war remains unsettled, but long after.
As we noted in “Trade Deficit USA: “We’re No. 1!” (11 Jan 2022), until America becomes more of a self-sustaining economy and brings more manufacturing back home, the trade deficit will continue to increase as long as Americans insist on buying the newest smartphone, four televisions in their homes, and a new wardrobe every season.
If inflation has a silver lining, it might be that higher prices will force Americans to rediscover thrift as a virtue.
We saw consumer spending beginning to bend in this direction in March, which we reported in “Highest Inflation in 40 Years Curbs Consumer Spending” (5 Apr 2022).