Nonfarm Hires Jump 64.7 Percent from 4.656 Million in Mar 2020 to 7.670 Million in Jun 2020, Higher by 16.8 Percent Than 6.564 Million in Jun 2019 In the Global Recession, with Output in the US Reaching a High in Feb 2020 (https://www.nber.org/cycles.html), in the Lockdown of Economic Activity in the COVID-19 Event, Seventeen Million Fewer Full-Time Jobs Relative to Working Population in the COVID-19 Event, Recovery Without Hiring in the Lost Economic Cycle of the Global Recession with Economic Growth Underperforming Below Trend Worldwide, Youth Unemployment, Middle-Age Unemployment 190.6 Percent Higher in Jul 2020 Than in Jul 2007 In the Global Recession, with Output in the US Reaching a High in Feb 2020 (https://www.nber.org/cycles.html), in the Lockdown of Economic Activity in the COVID-19 Event, Increase of US Consumer Prices at Annual Equivalent 7.4 Percent in Jul 2020 with Inflation Worldwide, Growth of US Exports at 9.4 Percent in Jun 2020 and Imports at 4.7 Percent, World Cyclical Slow Growth, and Government Intervention in Globalization: Part V

 

Carlos M. Pelaez

 

© Carlos M. Pelaez, 2009, 2010, 2011, 2012, 2013, 2014, 2015, 2016, 2017, 2018, 2019, 2020.

 

I Recovery without Hiring

IA1 Hiring Collapse

IA2 Labor Underutilization

            ICA3 Seventeen Million Fewer Full-time Jobs

IA4 Theory and Reality of Cyclical Slow Growth Not Secular Stagnation: Youth and Middle-Age Unemployment

IC United States Inflation

IC Long-term US Inflation

ID Current US Inflation

II United States International Trade

III World Financial Turbulence

IV Global Inflation

V World Economic Slowdown

VA United States

VB Japan

VC China

VD Euro Area

VE Germany

VF France

VG Italy

VH United Kingdom

VI Valuation of Risk Financial Assets

VII Economic Indicators

VIII Interest Rates

IX Conclusion

References

Appendixes

Appendix I The Great Inflation

IIIB Appendix on Safe Haven Currencies

IIIC Appendix on Fiscal Compact

IIID Appendix on European Central Bank Large Scale Lender of Last Resort

IIIG Appendix on Deficit Financing of Growth and the Debt Crisis

 

 

 

II United States International Trade. Table IIA-1 provides the trade balance of the US and monthly growth of exports and imports seasonally adjusted with the latest release and revisions (https://www.census.gov/foreign-trade/index.html). Because of heavy dependence on imported oil, fluctuations in the US trade account originate largely in fluctuations of commodity futures prices caused by carry trades from zero interest rates into commodity futures exposures in a process similar to world inflation waves (https://cmpassocregulationblog.blogspot.com/2020/07/contraction-of-household-wealth-by-14.html and earlier https://cmpassocregulationblog.blogspot.com/2020/06/mediocre-cyclical-united-states.html). The Census Bureau revised data for 2020, 2019, 2018, 2017, 2016, 2015, 2014 and 2013. Exports decreased 4.4 percent in May 2020 while imports decreased 0.9 percent in the global recession, with output in the US reaching a high in Feb 2020 (https://www.nber.org/cycles.html), in the lockdown of economic activity in the COVID-19 event.. The trade deficit decreased from $54,801 million in May 2020 to $50,695 million in Jun 2020. The trade deficit deteriorated to $43,215 million in Feb 2016, improving to $36,551 million in Mar 2016. The trade deficit deteriorated to $37,566 million in Apr 2016, deteriorating to $39,342 million in May 2016 and $41,658 million in Jun 2016. The trade deficit improved to $40,537 million in Jul 2016, moving to $40,563 million in Aug 2016. The trade deficit improved to $36,545 million in Sep 2016, deteriorating to $39,232 million in Oct 2016. The trade deficit deteriorated to $44,465 million in Nov 2016, improving to $41,469 million in Dec 2016.  The trade deficit deteriorated to $42,918 million in Jan 2017, improving to $39,520 million in Feb 2017. The trade deficit deteriorated to $40,889 million in Mar 2017 and $43,807 million in Apr 2017, improving to $43,588 million in May 2017. The trade deficit improved to $42,223 million in Jun 2017, deteriorating to $42,853 million in Jul 2017. The trade deficit improved to $41,517 million in Aug 2017, improving to $41,165 million in Sep 2017. The trade deficit deteriorated to $42,644 million in Oct 2017, deteriorating to $45,558 million in Nov 2017. The trade deficit deteriorated to 47,109 million in Dec 2017, deteriorating to $47,247 million in Jan 2018. The trade deficit deteriorated to $48,714 million in Feb 2018, improving to $42,893 million in Mar 2018. The trade deficit worsened to $44,666 million in Apr 2018, improving to $41,160 million in May 2018. The trade deficit deteriorated to $44,404 million in Jun 2018, deteriorating to $50,572 million in Jul 2018. The trade deficit improved to $50,381 million in Aug 2018 and deteriorated to $51,453 million in Sep 2018. The trade deficit deteriorated to $52,398 million in Oct 2018 and improved to $49,634 million in Nov 2018. The trade deficit deteriorated to $56,413 million in Dec 2018, improving to $49,023 million in Jan 2019. The trade deficit improved to $47,300 million in Feb 2019, deteriorating to $48,914 million in Mar 2019. The trade deficit deteriorated to $49,203 million in Apr 2019, deteriorating to $51,258 million in May 2019. The trade deficit deteriorated to $51,749 million in Jun 2019, improving to $51,041 million in Jul 2019. The trade deficit improved to $50,778 million in Aug 2019, improving to $47,839 million in Sep 2019. The trade deficit improved to $43,029 million in Oct 2019, improving to $41,054 million in Nov 2019. The trade deficit deteriorated to $45,676 million in Dec 2019, improving to $42,042 million in Jan 2020. The trade deficit improved to $34,672 million in Feb 2020, deteriorating to $42,340 million in Mar 2020. The trade deficit deteriorated to $49,756 million in Apr 2020. The trade deficit deteriorated to $54,801 million in May 2020, improving to $50.695 million in Jun 2020.

Table IIA-1, US, Trade Balance of Goods and Services Seasonally Adjusted Millions of Dollars and ∆%

	Balance		Exports	∆%		Imports	∆%
Jan-2016	-40026		181109	-1.8		221135	-1.9
Feb-2016	-43215		183276	1.2		226491	2.4
Mar-2016	-36551		181881	-0.8		218433	-3.6
Apr-2016	-37566		183553	0.9		221119	1.2
May-2016	-39342		184230	0.4		223571	1.1
Jun-2016	-41658		186019	1.0		227677	1.8
Jul-2016	-40537		186950	0.5		227487	-0.1
Aug-2016	-40563		189893	1.6		230456	1.3
Sep-2016	-36545		190772	0.5		227316	-1.4
Oct-2016	-39232		189359	-0.7		228591	0.6
Nov-2016	-44465		187896	-0.8		232361	1.6
Dec-2016	-41469		192986	2.7		234455	0.9
Jan-2017	-42918		195456	1.3		238374	1.7
Feb-2017	-39520		196060	0.3		235580	-1.2
Mar-2017	-40889		195377	-0.3		236266	0.3
Apr-2017	-43807		195251	-0.1		239058	1.2
May-2017	-43588		194910	-0.2		238498	-0.2
Jun-2017	-42223		197013	1.1		239236	0.3
Jul-2017	-42853		196432	-0.3		239286	0.0
Aug-2017	-41517		198212	0.9		239729	0.2
Sep-2017	-41165		200589	1.2		241754	0.8
Oct-2017	-42644		202314	0.9		244958	1.3
Nov-2017	-45558		206199	1.9		251757	2.8
Dec-2017	-47109		209576	1.6		256685	2.0
Jan-2018	-47247		207127	-1.2		254374	-0.9
Feb-2018	-48714		209943	1.4		258657	1.7
Mar-2018	-42893		213279	1.6		256173	-1.0
Apr-2018	-44666		212096	-0.6		256762	0.2
May-2018	-41160		215032	1.4		256192	-0.2
Jun-2018	-44404		212549	-1.2		256953	0.3
Jul-2018	-50572		210606	-0.9		261179	1.6
Aug-2018	-50381		210833	0.1		261214	0.0
Sep-2018	-51453		213188	1.1		264641	1.3
Oct-2018	-52398		214322	0.5		266719	0.8
Nov-2018	-49634		211465	-1.3		261099	-2.1
Dec-2018	-56413		208944	-1.2		265357	1.6
Jan-2019	-49023		210243	0.6		259267	-2.3
Feb-2019	-47300		210809	0.3		258109	-0.4
Mar-2019	-48914		213157	1.1		262072	1.5
Apr-2019	-49203		209288	-1.8		258491	-1.4
May-2019	-51258		212852	1.7		264110	2.2
Jun-2019	-51749		209254	-1.7		261003	-1.2
Jul-2019	-51041		210462	0.6		261503	0.2
Aug-2019	-50778		210517	0.0		261295	-0.1
Sep-2019	-47839		209210	-0.6		257049	-1.6
Oct-2019	-43029		210403	0.6		253432	-1.4
Nov-2019	-41054		210571	0.1		251625	-0.7
Dec-2019	-45676		211496	0.4		257171	2.2
Jan-2020	-42042		210446	-0.5		252488	-1.8
Feb-2020	-34672		211752	0.6		246425	-2.4
Mar-2020	-42340		190184	-10.2		232524	-5.6
Apr-2020	-49756		151133	-20.5		200890	-13.6
May-2020	-54801		144687	-4.3		199488	-0.7
Jun-2020	-50695		158253	9.4		208949	4.7

Source: US Census Bureau

https://www.census.gov/foreign-trade/index.html

Table IIA-1B provides US exports, imports and the trade balance of goods. The US has not shown a trade surplus in trade of goods since 1976. The deficit of trade in goods deteriorated sharply during the boom years from 2000 to 2007. The deficit improved during the contraction in 2009 but deteriorated in the expansion after 2009. The deficit could deteriorate sharply with growth at full employment.

Table IIA-1B, US, International Trade Balance of Goods, Exports and Imports of Goods, Millions of Dollars, Census Basis

	Balance	∆%	Exports	∆%	Imports	∆%
1960	4,608	NA	19,626	NA	15,018	NA
1961	5,476	18.8	20,190	2.9	14,714	-2.0
1962	4,583	-16.3	20,973	3.9	16,390	11.4
1963	5,289	15.4	22,427	6.9	17,138	4.6
1964	7,006	32.5	25,690	14.5	18,684	9.0
1965	5,333	-23.9	26,699	3.9	21,366	14.4
1966	3,837	-28.1	29,379	10.0	25,542	19.5
1967	4,122	7.4	30,934	5.3	26,812	5.0
1968	837	-79.7	34,063	10.1	33,226	23.9
1969	1,289	54.0	37,332	9.6	36,043	8.5
1970	3,224	150.1	43,176	15.7	39,952	10.8
1971	-1,476	-145.8	44,087	2.1	45,563	14.0
1972	-5,729	288.1	49,854	13.1	55,583	22.0
1973	2,389	-141.7	71,865	44.2	69,476	25.0
1974	-3,884	-262.6	99,437	38.4	103,321	48.7
1975	9,551	-345.9	108,856	9.5	99,305	-3.9
1976	-7,820	-181.9	116,794	7.3	124,614	25.5
1977	-28,352	262.6	123,182	5.5	151,534	21.6
1978	-30,205	6.5	145,847	18.4	176,052	16.2
1979	-23,922	-20.8	186,363	27.8	210,285	19.4
1980	-19,696	-17.7	225,566	21.0	245,262	16.6
1981	-22,267	13.1	238,715	5.8	260,982	6.4
1982	-27,510	23.5	216,442	-9.3	243,952	-6.5
1983	-52,409	90.5	205,639	-5.0	258,048	5.8
1984	-106,702	103.6	223,976	8.9	330,678	28.1
1985	-117,711	10.3	218,815	-2.3	336,526	1.8
1986	-138,279	17.5	227,159	3.8	365,438	8.6
1987	-152,119	10.0	254,122	11.9	406,241	11.2
1988	-118,526	-22.1	322,426	26.9	440,952	8.5
1989	-109,399	-7.7	363,812	12.8	473,211	7.3
1990	-101,719	-7.0	393,592	8.2	495,311	4.7
1991	-66,723	-34.4	421,730	7.1	488,453	-1.4
1992	-84,501	26.6	448,164	6.3	532,665	9.1
1993	-115,568	36.8	465,091	3.8	580,659	9.0
1994	-150,630	30.3	512,626	10.2	663,256	14.2
1995	-158,801	5.4	584,742	14.1	743,543	12.1
1996	-170,214	7.2	625,075	6.9	795,289	7.0
1997	-180,522	6.1	689,182	10.3	869,704	9.4
1998	-229,758	27.3	682,138	-1.0	911,896	4.9
1999	-328,821	43.1	695,797	2.0	1,024,618	12.4
2000	-436,104	32.6	781,918	12.4	1,218,022	18.9
2001	-411,899	-5.6	729,100	-6.8	1,140,999	-6.3
2002	-468,262	13.7	693,104	-4.9	1,161,366	1.8
2003	-532,350	13.7	724,771	4.6	1,257,121	8.2
2004	-654,829	23.0	814,875	12.4	1,469,703	16.9
2005	-772,374	18.0	901,082	10.6	1,673,456	13.9
2006	-827,970	7.2	1,025,969	13.9	1,853,939	10.8
2007	-808,765	-2.3	1,148,197	11.9	1,956,962	5.6
2008	-816,200	0.9	1,287,441	12.1	2,103,641	7.5
2009	-503,583	-38.3	1,056,042	-18.0	1,559,625	-25.9
2010	-635,365	26.2	1,278,493	21.1	1,913,858	22.7
2011	-725,447	14.2	1,482,507	16.0	2,207,954	15.4
2012	-730,446	0.7	1,545,821	4.3	2,276,267	3.1
2013	-689,470	-5.6	1,578,517	2.1	2,267,987	-0.4
2014	-734,482	6.5	1,621,874	2.7	2,356,356	3.9
2015	-745,483	1.5	1,503,328	-7.3	2,248,811	-4.6
2016	-735,326	-1.4	1,451,460	-3.5	2,186,786	-2.8
2017	-792,396	7.8	1,547,195	6.6	2,339,591	7.0
2018	-872,041	10.1	1,665,688	7.7	2,537,729	8.5
2019	-854,371	-2.0	1,643,161	-1.4	2,497,531	-1.6

Source: US Census Bureau

https://www.census.gov/foreign-trade

There is recent sharp deterioration of the US trade balance and the three-month moving average in Chart IIA-1 of the US Census Bureau with further improvement in Jan-Feb 2019. There is marginal improvement in Jun-Nov 2019 with deterioration in Dec 2019. There is improvement in Jan-Feb 2020 with deterioration in Mar-May 2020 followed by improvement in Jun 2020.

Chart IIA-1A, US, International Trade Balance, Exports and Imports of Goods and Services and Three-Month Moving Average, USD Billions

Source: US Census Bureau

https://www.census.gov/foreign-trade/index.html

Table IIA-2B provides the US international trade balance, exports and imports of goods and services on an annual basis from 1960 to 2019. The trade balance deteriorated sharply over the long term. The US has a large deficit in goods or exports less imports of goods but it has a surplus in services that helps to reduce the trade account deficit or exports less imports of goods and services. The current account deficit at 2.8 percent in IVQ2018 decreases to 2.6 percent in IQ2019. The current account deficit decreases to 2.4 percent in IIQ2019. The current account deficit decreases to 2.3 percent in IIIQ2019. The current account deficit decreased to 2.0 percent in IVQ2019. The absolute value of the net international investment position at $9.6 trillion in IVQ2018 increases to $10.2 trillion in IQ2018. The absolute value of the net international investment position increases at $10.6 trillion in IIQ2019. The absolute value of the net international investment position increases to $10.98 trillion in IIIQ2019. The absolute value of the net international investment position increased to $10.99 trillion in IVQ2019. The ratio of the current account deficit to GDP has stabilized below 3 percent of GDP compared with much higher percentages before the recession but is combined now with much higher imbalance in the Treasury budget (see Pelaez and Pelaez, The Global Recession Risk (2007), Globalization and the State, Vol. II (2008b), 183-94, Government Intervention in Globalization (2008c), 167-71). There is still a major challenge in the combined deficits in current account and in federal budgets. The final rows of Table IIA-2B show marginal improvement of the trade deficit from $554,522 million in 2011 to lower $525,906 million in 2012 with exports growing 4.8 percent and imports 2.8 percent. The trade balance improved further to deficit of $446,829 million in 2013 with growth of exports of 2.9 percent while imports virtually stagnated, decreasing 0.5 percent. The trade deficit deteriorated in 2014 to $484,144 million with growth of exports of 3.4 percent and of imports of 4.2 percent. The trade deficit deteriorated in 2015 to $491,261 million with decrease of exports of 4.7 percent and decrease of imports of 3.7 percent. The trade deficit improved in 2016 to $481,169 million with decrease of exports of 1.8 percent and decrease of imports of 1.9 percent. The trade deficit deteriorated in 2017 to $513,791 million with growth of exports of 6.7 percent and of imports of 6.7 percent. The trade deficit deteriorated in 2018 to $579,937 million with growth of exports of 6.4 percent and of imports of 7.5 percent. The trade deficit improved in 2019 to $576,865 million with decrease of exports of 0.4 percent and decrease of imports of 0.5 percent.  Growth and commodity shocks under alternating inflation waves (https://cmpassocregulationblog.blogspot.com/2020/07/contraction-of-household-wealth-by-14.html and earlier https://cmpassocregulationblog.blogspot.com/2020/06/mediocre-cyclical-united-states.html) have deteriorated the trade deficit from the low of $394,771 million in 2009.

Table IIA-2B, US, International Trade Balance of Goods and Services, Exports and Imports of Goods and Services, SA, Millions of Dollars, Balance of Payments Basis

	Balance	Exports	∆%	Imports	∆%
1960	3,508	25,939		22,433
1961	4,194	26,403	1.8	22,208	-1.0
1962	3,371	27,722	5.0	24,352	9.7
1963	4,210	29,620	6.8	25,411	4.3
1964	6,022	33,340	12.6	27,319	7.5
1965	4,664	35,285	5.8	30,621	12.1
1966	2,939	38,926	10.3	35,987	17.5
1967	2,604	41,333	6.2	38,729	7.6
1968	250	45,544	10.2	45,292	16.9
1969	90	49,220	8.1	49,130	8.5
1970	2,255	56,640	15.1	54,385	10.7
1971	-1,301	59,677	5.4	60,980	12.1
1972	-5,443	67,223	12.6	72,664	19.2
1973	1,900	91,242	35.7	89,342	23.0
1974	-4,293	120,897	32.5	125,189	40.1
1975	12,403	132,585	9.7	120,181	-4.0
1976	-6,082	142,716	7.6	148,798	23.8
1977	-27,247	152,302	6.7	179,547	20.7
1978	-29,763	178,428	17.2	208,191	16.0
1979	-24,566	224,132	25.6	248,696	19.5
1980	-19,407	271,835	21.3	291,242	17.1
1981	-16,172	294,399	8.3	310,570	6.6
1982	-24,156	275,235	-6.5	299,392	-3.6
1983	-57,767	266,106	-3.3	323,874	8.2
1984	-109,074	291,094	9.4	400,166	23.6
1985	-121,879	289,071	-0.7	410,951	2.7
1986	-138,539	310,034	7.3	448,572	9.2
1987	-151,683	348,869	12.5	500,553	11.6
1988	-114,566	431,150	23.6	545,714	9.0
1989	-93,142	487,003	13.0	580,145	6.3
1990	-80,865	535,234	9.9	616,098	6.2
1991	-31,136	578,343	8.1	609,479	-1.1
1992	-39,212	616,882	6.7	656,094	7.6
1993	-70,311	642,863	4.2	713,174	8.7
1994	-98,493	703,254	9.4	801,747	12.4
1995	-96,384	794,387	13.0	890,771	11.1
1996	-104,065	851,602	7.2	955,667	7.3
1997	-108,273	934,453	9.7	1,042,726	9.1
1998	-166,140	933,174	-0.1	1,099,314	5.4
1999	-255,809	976,525	4.6	1,232,335	12.1
2000	-369,686	1,082,963	10.9	1,452,650	17.9
2001	-360,373	1,015,366	-6.2	1,375,739	-5.3
2002	-420,666	986,095	-2.9	1,406,762	2.3
2003	-496,243	1,028,186	4.3	1,524,429	8.4
2004	-610,838	1,168,120	13.6	1,778,958	16.7
2005	-716,542	1,291,503	10.6	2,008,045	12.9
2006	-763,533	1,463,991	13.4	2,227,523	10.9
2007	-710,997	1,660,815	13.4	2,371,811	6.5
2008	-712,350	1,849,586	11.4	2,561,936	8.0
2009	-394,771	1,592,792	-13.9	1,987,563	-22.4
2010	-503,087	1,872,320	17.5	2,375,407	19.5
2011	-554,522	2,143,552	14.5	2,698,074	13.6
2012	-525,906	2,247,453	4.8	2,773,359	2.8
2013	-446,829	2,313,237	2.9	2,760,066	-0.5
2014	-484,144	2,392,268	3.4	2,876,412	4.2
2015	-491,261	2,279,743	-4.7	2,771,004	-3.7
2016	-481,169	2,237,923	-1.8	2,719,092	-1.9
2017	-513,791	2,387,391	6.7	2,901,181	6.7
2018	-579,937	2,539,383	6.4	3,119,320	7.5
2019	-576,865	2,528,262	-0.4	3,105,127	-0.5

Source: US Census Bureau

https://www.census.gov/foreign-trade/index.html

Chart IIA-2 of the US Census Bureau provides the US trade account in goods and services SA from Jan 1992 to Jun 2020. There is long-term trend of deterioration of the US trade deficit shown vividly by Chart IIA-2. The global recession from IVQ2007 to IIQ2009 reversed the trend of deterioration. Deterioration resumed together with incomplete recovery and was influenced significantly by the carry trade from zero interest rates to commodity futures exposures (these arguments are elaborated in Pelaez and Pelaez, Financial Regulation after the Global Recession (2009a), 157-66, Regulation of Banks and Finance (2009b), 217-27, International Financial Architecture (2005), 15-18, The Global Recession Risk (2007), 221-5, Globalization and the State Vol. II (2008b), 197-213, Government Intervention in Globalization (2008c), 182-4 http://cmpassocregulationblog.blogspot.com/2011/07/causes-of-2007-creditdollar-crisis.html http://cmpassocregulationblog.blogspot.com/2011/01/professor-mckinnons-bubble-economy.html http://cmpassocregulationblog.blogspot.com/2011/01/world-inflation-quantitative-easing.html http://cmpassocregulationblog.blogspot.com/2011/01/treasury-yields-valuation-of-risk.html http://cmpassocregulationblog.blogspot.com/2010/11/quantitative-easing-theory-evidence-and.html http://cmpassocregulationblog.blogspot.com/2010/12/is-fed-printing-money-what-are.html).  Earlier research focused on the long-term external imbalance of the US in the form of trade and current account deficits (Pelaez and Pelaez, The Global Recession Risk (2007), Globalization and the State Vol. II (2008b) 183-94, Government Intervention in Globalization (2008c), 167-71). US external imbalances have not been fully resolved and tend to widen together with improving world economic activity and commodity price shocks. There are additional effects for revaluation of the dollar with the Fed orienting interest rate increases now followed by decreases and inaction while the European Central Bank and the Bank of Japan determine negative nominal interest rates.

Chart IIA-2, US, Balance of Trade SA, Monthly, Millions of Dollars, Jan 1992-Jun 2020

Source: US Census Bureau

https://www.census.gov/foreign-trade/index.html

 

Chart IIA-3 of the US Census Bureau provides US exports SA from Jan 1992 to Jun 2020. There was sharp acceleration from 2003 to 2007 during worldwide economic boom and increasing inflation. Exports fell sharply during the financial crisis and global recession from IVQ2007 to IIQ2009. Growth picked up again together with world trade and inflation but stalled in the final segment with less rapid global growth and inflation. Exports contracted sharply in Mar-May 2020 in the global recession, with output in the US reaching a high in Feb 2020 (https://www.nber.org/cycles.html), in the lockdown of economic activity in the COVID-19 event with partial recovery in Jun 2020.

Chart IIA-3, US, Exports SA, Monthly, Millions of Dollars Jan 1992-Jun 2020

Source: US Census Bureau

https://www.census.gov/foreign-trade/index.html

 

Growth was stronger between 2003 and 2007 with worldwide economic boom and inflation. There was sharp drop during the financial crisis and global recession. There is stalling import levels in the final segment in Chart IIA-4 resulting from weaker world economic growth and diminishing inflation because of risk aversion and portfolio reallocations from commodity exposures to equities. Imports contracted sharply in the global recession, with output in the US reaching a high in Feb 2020 (https://www.nber.org/cycles.html), in the lockdown of economic activity in the COVID-19 event with partial recovery in Jun 2020.

Chart IIA-4, US, Imports SA, Monthly, Millions of Dollars Jan 1992-Jun 2020

Source: US Census Bureau

https://www.census.gov/foreign-trade/index.html

 

There is improvement of the US trade balance in goods in Table IIA-3 from deficit of $75,298 million in Jun 2019 to deficit of $72,150 million in Jun 2020. The nonpetroleum deficit decreased from $72,768 million in Jun 2019 to $72,306 million in Jun 2020 while the petroleum deficit decreased from minus $1,718 million in Jun 2019 to $1,321 million in Jun 2020. Total exports of goods decreased 24.1 percent in Jun 2020 relative to a year earlier while total imports decreased 17.0 percent. Nonpetroleum exports decreased 21.3 percent from Jun 2019 to Jun 2020 while nonpetroleum imports decreased 13.5 percent. Petroleum imports decreased 57.4 percent with declining oil prices. Oil use contracted in the global recession, with output in the US reaching a high in Feb 2020 (https://www.nber.org/cycles.html), in the lockdown of economic activity in the COVID-19 event.

Table IIA-3, US, International Trade in Goods Balance, Exports and Imports $ Millions and ∆% SA

	Jun 2020	Jun 2019	∆%
Total Balance	-72,150	-75,298
Petroleum	1,321	-1,718
Non-Petroleum	-72,306	-72,768
Total Exports	102,869	135,542	-24.1
Petroleum	8,275	14,621	-43.4
Non-Petroleum	94,581	120,147	-21.3
Total Imports	175,019	210,839	-17.0
Petroleum	6,954	16,339	-57.4
Non-Petroleum	166,887	192,915	-13.5

Details may not add because of rounding and seasonal adjustment

Source: US Census Bureau

https://www.census.gov/foreign-trade/index.html

US exports and imports of goods not seasonally adjusted in Jan-Jun 2020 and Jan-Jun 2019 are in Table IIA-4. The rate of growth of exports was minus 16.5 percent and minus 12.7 percent for imports. The US has partial hedge of commodity price increases in exports of agricultural commodities that decreased 3.2 percent and of mineral fuels that decreased 18.2 percent both because prices of raw materials and commodities increase and fall recurrently because of shocks of risk aversion and portfolio reallocations. There is now the impact in the global recession, with output in the US reaching a high in Feb 2020 (https://www.nber.org/cycles.html), in the lockdown of economic activity in the COVID-19 event. The US exports a growing amount of crude oil, decreasing 20.5 percent in cumulative Jan-Jun 2020 relative to a year earlier. US exports and imports consist mostly of manufactured products, with less rapidly increasing prices. US manufactured exports decreased 17.2 percent while manufactured imports decreased 12.7 percent. Significant part of the US trade imbalance originates in imports of mineral fuels decreasing 39.9 percent and petroleum decreasing 40.1 percent with wide oscillations in oil prices. The limited hedge in exports of agricultural commodities and mineral fuels compared with substantial imports of mineral fuels and crude oil results in waves of deterioration of the terms of trade of the US, or export prices relative to import prices, originating in commodity price increases caused by carry trades from zero interest rates. These waves are similar to those in worldwide inflation.

Table IIA-4, US, Exports and Imports of Goods, Not Seasonally Adjusted Millions of Dollars and %, Census Basis

	Jan-Jun 2020    $ Millions	Jan-Jun 2019    $ Millions	∆%
Exports	687,126	822,944	-16.5
Manufactured	468,029	565,031	-17.2
Agricultural Commodities	65,604	67,740	-3.2
Mineral Fuels	78,868	96,388	-18.2
Petroleum	60,068	75,595	-20.5
Imports	1,078,175	1,235,181	-12.7
Manufactured	944,927	1,064,558	-11.2
Agricultural Commodities	68,562	67,720	1.2
Mineral Fuels	61,939	103,111	-39.9
Petroleum	57,867	96,559	-40.1

Source: US Census Bureau

https://www.census.gov/foreign-trade/index.html

Table IIA-4A provides the United States balance of trade in goods, exports of goods and imports of goods NSA in millions of US dollars and percent share in Jan-Jun 2020. North America, consisting of Mexico and Canada, have joint share of 31.7 percent of exports and 25.1 percent of imports. The combined share of North America and Europe is 55.7 percent of exports and 51.2 percent of imports. The share of the Pacific Rim in exports is 25.7 percent and 34.3 percent of imports.

Table IIA-4A United States, Balance of Trade in Goods, Exports in Goods and Imports of Goods, NSA, Millions of US Dollars

Jan-Jun 2020	Millions USD	Million USD	Percent	Million USD	Percent
Region/Country	Balance	Exports		Imports
Total Census Basis	-391,049	687,126		1,078,175
North America*	-52,044	218,068	31.7	270,111	25.1
Europe	-117,059	164,878	24.0	281,937	26.1
Euro Area	-69,327	106,021	15.4	175,349	16.3
Pacific Rim	-192,596	176,760	25.7	369,355	34.3
China	-131,717	49,491	7.2	181,208	16.8
Japan	-23,770	33,191	4.8	56,961	5.3
Brazil	6,153	17,167	2.5	11,015	1.0

*Canada and Mexico

Source: US Census Bureau

https://www.census.gov/foreign-trade/index.html

© Carlos M. Pelaez, 2009, 2010, 2011, 2012, 2013, 2014, 2015, 2016, 2017, 2018, 2019, 2020.