International Trade News from Across the World

Soaring Import Penetration Slows US Economic Growth and Job Creation

Chinese Share of US High-Tech Market Accelerates

Surprise! American manufacturing is rebounding

USA Today

• Comment: "Even with an underwhelming 16,000 manufacturing jobs added last month, the business of making stuff is doing well, so well that many economists see domestic manufacturing not as a lost cause but as entering a renaissance."

In China Economics is Politics

Business Week

• Comment: "High fixed-asset investment and low domestic consumption also have social ramifications. Growing economic wealth ultimately matters because it allows improvement in the material lives of the population. While the revenues of centrally and locally managed state-owned enterprises (SOEs) have been increasing by around 20 percent to 25 percent per annum over the past 10 years, wages, salaries, and household income from interest and investment dividends have been falling."

Industrial Production and Capacity Utilization

Federal Reserve

• Comment: "Industrial production increased 1.1 percent in April. Output is now reported to have fallen 0.6 percent in March and to have moved up 0.4 percent in February; previously, industrial production was estimated to have been unchanged in both months. Manufacturing output increased 0.6 percent in April after having decreased 0.5 percent in March"

Empire State Manufacturing Survey

New York Fed

• Comment: "The May index for general business conditions rose a solid eleven points to 17.1, suggesting that activity for New York State’s manufacturers expanded at a moderate pace"

The Fastest-Dying Jobs of This Generation (and What Replaced Them)

The Atlantic

• Comment: "In roughly 20 years, entire categories of factory work nearly disappeared. If your job hinged on your aptitude with a shoe machine, it was in danger. Likewise if you worked a lathe every day for a living, or had a spot anywhere else on a classic production line, where dozens of hands handled simple, discreet tasks. (How sociologists ended up on this list, I'm frankly not sure.) These were jobs that, thanks to their heavy levels of unionization, paid a good middle class wage to employees without many skills. And when manufacturing technology improved, they became redundant."

Export-Import Bank reauthorized by Senate

Washington Post

• Comment: "Depending who you talk to, the fact that it was the Ex-Im bank that provided the opportunity for election year cooperation was a sign either that occasional bouts of bipartisanship are still possible in Washington — or a symbol of the enduring power of corporate influence over both parties."

Ex-Im Bank deal clears Congress

Politico

• Comment: “Our job is to protect taxpayers,” answered DeMint minutes later. “When we guarantee a loan, we are signing the taxpayer’s name to a loan guarantee. … We cannot assume this money is coming back to the taxpayer.“We’re in a bidding war with China and Europe to see who can subsidize the most loans at a time when all of us are broke. We need to bring this to a close,” DeMint said."

Congress votes to reauthorize Export-Import Bank

Fox News

• Comment: "The Senate action to renew the charter of the independent federal agency for three years and increase its lending cap by $40 billion sends the legislation to President Barack Obama, who has praised the bank for contributing to his job-promoting goal of doubling exports."

The emperor does know

Economist

• Comment: "under the Communist Party’s system of cadre evaluations, local officials are graded on the basis of a series of internal targets that have little to do with the rule of law. The targets are meant for internal use, but local governments have sometimes published them on websites, and foreign scholars have also seen copies. The most important measures are maintaining social stability, achieving economic growth and, in many areas, enforcing population controls. Cadres sign contracts that spell out their responsibilities. Failure to meet targets can end a cadre’s career. Fulfilling them, even if it means trampling laws to do so, can mean career advancement and financial bonuses."

China Market Challenges Plane Makers

New York Times

• Comment: “We’ll be going into China without a doubt,” Mr. Camp said from his office in Hamilton, New Zealand. Agreeing to manufacture the P-750 turboprop in China may be part of the deal. “We don’t see any advantage from a cost perspective,” Mr. Camp said. “It’s more of a strategy for entering the market.” He added that Chinese content may make the plane more acceptable to buyers, “particularly government buyers,” he said."

Deal could clear way for export bank bill

Politico

• Comment: "Five GOP amendments will be permitted Tuesday — some re-litigating specific agreements reached by House leaders. But in each case, a supermajority of 60 votes would be required, leaving Senate Majority Leader Harry Reid (D-Nev.) hopeful that the House package will survive intact and go quickly to President Barack Obama for his signature this week."

Senate deal clears way for vote on Ex-Im Bank

Reuters

• Comment: "Senate Majority Leader Harry Reid, a Nevada Democrat, said the Senate would take up the bill on Tuesday and consider five amendments offered by Republicans. Each would require 60 votes to pass, as would the final bill.The legislation would extend the nearly 80-year-old bank's charter through September 2014 and raise its lending cap over the next 16 months to $140 billion, from $100 billion currently."

Obama supports tax incentives to move jobs to U.S.

Washington Post

• Comment: "Obama urged Congress to pass legislation giving companies a new 20 percent tax credit for the cost of moving jobs back from overseas, and a 10 percent tax credit for small businesses that hire workers and increase wages. He has supported both measures before, but framed them as part of a five-point “to-do list” he said Congress should prioritize."

Analysts Expect China to Broaden Stimulus

New York Times

• Comment: "But economists were skeptical about the effectiveness of allowing banks to lend more money at a time when many businesses do not necessarily see a lot of attractive opportunities that would prompt them to borrow and invest. At the same time, a steep decline in land prices and apartment prices, engineered by the government to improve the affordability of housing, has left many companies without enough collateral to post in order to qualify for loans."

China Acts to Boost Loans, Bolster Flagging Economy

New York Times

• Comment: "The domestic production and investment data had followed hot on the heels of weaker than forecast trade data, with the annual rate of export growth around half the level expected and growth in imports grinding to a halt on a nominal basis in April, underlining China's vulnerability to weakness in global demand for goods produced in the country's vast factory sector."

The Human Disaster of Unemployment

New York Times

• Comment: "Joblessness is also associated with some serious illnesses, although the causal links are poorly understood. Studies have found strong links between unemployment and cancer, with unemployed men facing a 25 percent higher risk of dying of the disease. Similarly higher risks have been found for heart disease and psychiatric problems."

Trade gap widens in March on record imports

The Hill

• Comment: "The year-over-year the deficit increased by $5.8 billion from March 2011, while exports were up $12.8 billion, or 7.3 percent, and imports were up $18.5 billion, or 8.4 percent.The trade deficit is on a path to eclipse last year's record deficit."

China's Economy May Soon Get a Loosening

Business Week

• Comment: “Today’s data on April spending and output put another nail into hopes that China’s economy is bottoming out,” writes Mark Williams, chief Asia economist at London-based Capital Economics, in a May 11 research note. China’s economy grew just 8.1 percent in the first quarter, its slowest pace since 2009. “This run of poor data will shake policymakers’ confidence and we expect it to prompt further policy easing. A required reserve ratio cut must surely be imminent.”

China’s Growth Slows, and Its Political Model Shows Limits

New York Times

• Comment: "Such changes would curb the state’s role, lessen corruption and encourage competition. But making them would involve a titanic power struggle. Executives of Chinese conglomerates, army generals, Politburo members, local officials and the “princeling” children of Communist Party elders have little incentive to refashion a system that fills their coffers."

China Has Hacked Our Electric Power Grid: Read About It In Screwed!

Dick Morris.com

• Comment: "Not only has Beijing likely hacked into our grid but, according to authors Brett M. Decker and William C. Triplett II in their excellent book Bowing to Beijing, China has even hacked into the Pentagon computer network “including the one serving [then] Defense Secretary Robert Gates.”

India Mulls WTO Complaint Over Higher U.S. Visa Fees

Business Week

• Comment: "For almost two years, Indian officials have been steamed about a move by American lawmakers that raises costs for the country’s outsourcing industry. In August 2010, with midterm elections on the horizon, the U.S. Congress approved a proposal that nearly doubled the fees companies pay to get certain work visas for non-U.S. employees."

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