International Trade News from Across the World

U.S. Economy Slowed to 1.6% Pace in 2nd Quarter

New York Times

• Comment: "Orders for large factory goods, excluding the volatile transportation sector, dropped in July, indicating that recovery in the manufacturing sector also was stalling."

Manufacturing Jobs for the GOP

Big Government

• Comment: "Even Ronald Reagan saw value in defending Harley Davidson and American semi-conductor businesses against market distorting practices by some U.S. competitors.A manufacturing strategy reducing tax and regulatory burdens, expensing capital investments, state flexibility, enforcing existing trade laws and responding to China’s illegal trade practices would harness the power of America’s entrepreneurs.Ensuring an uninterrupted defense supply chain is critical as America’s warfighters deserve equipment made by trustworthy American hands – not missile propellant from China, airborne refueling tankers from France or force protection barriers made in England instead of Illinois"

Obama Administration Proposes Steps to Tighten U.S. Trade Rules

Business Week

• Comment: "Proposals offered yesterday include changes to make it harder for individual companies to be excused from country-wide duties, adjustments in methods of anti-dumping calculations and alterations to how labor rates are calculated when determining if products are being sold at artificially low prices."

Economy slows to 1.6 percent as trade gap widens

Associated Press

• Comment: "The widening trade deficit subtracted nearly 3.4 percentage points from second quarter growth, the largest hit from a trade imbalance since 1947, the government said."

This Is Not a Recovery

New York Times

• Comment: "It can finally get serious about confronting China over its currency manipulation: how many times do the Chinese have to promise to change their policies, then renege, before the administration decides that it’s time to act?"

Scarcity Of Jobs Puts More At Risk Of Foreclosure

KESQ

• Comment: "Such slow growth won't feel much like an economic recovery and won't lead to much hiring. The unemployment rate, now at 9.5 percent, could even rise by the end of the year. "The economy is going to limp along for the next few months," said Gus Faucher, an economist at Moody's Analytics. There's even a one in three chance it could slip back into recession, he said."

Japan’s Leader Says He’ll Move to Rein In Surging Yen

New York Times

• Comment: "The Bank of Japan is hesitant to return to a full-blown easing of monetary controls since that policy, which involves flooding markets with extra cash under a liquidity target, had little effect in beating deflation when it was in place until March 2006.Japan has not intervened in the currency market since March 2004, when it ended a 15-month, 35 trillion yen ($315 billion) selling spree aimed at rescuing an economic recovery.'

Banks back switch to renminbi for trade

Financial Times

• Comment: "A number of the world’s biggest banks have launched international roadshows promoting the use of the renminbi to corporate customers instead of the dollar for trade deals with China. HSBC, which recently moved its chief executive from London to Hong Kong, and Standard Chartered, are offering discounted transaction fees and other financial incentives to companies that choose to settle trade in the Chinese currency.” This does not strike me as a declaration of faith in the managers of the U.S. economy."

Weekly jobless claims fall 31,000 to 473,000

CBS Marketwatch

• Comment: "Altogether, 10.2 million people were collecting some type of unemployment benefits in the week ended Aug. 7, up from 9.9 million, the government reported"

Mazda, Ford to invest $350 million in Thai plant

Rock Hill Herald

• Comment: "The U.S. and Japanese automakers also run plants in China and the U.S. together. The latest investment won't increase production capacity at the plant from the current 275,000 but will focus on revamping the facility, said Mazda spokesman Kotaro Minagawa. The investment, which will bring the total at the Thai joint venture since 1995 to $1.85 billion, will also go into work force training, the companies said."The new investment in AAT reinforces Ford Motor Co.'s long-term commitment to Thailand as a strategic manufacturing base for our global operations," said Joe Hinrichs, president of Ford, Asia Pacific and Africa."

Our Blue-Collar Great Depression

Wall Street Journal

• Comment: "Today's job losses are concentrated among workers under 30 who are less well-educated, with those in blue-collar industries suffering the most. Employment in construction, maintenance and repair, machine-operation and transportation (think truck and bus drivers) has shrunk 18% since the recession's start."

Economic recovery falters: Does it signal recession or just a 'pause'?

MinnPost

• Comment: "Charles McMillion, an economist at MBG Information Services, sees the durable-goods and housing numbers as confirmation that the economy is in a period of stagnation at best. "Odds that the economy is again sliding into overall decline are now at least 50/50," he wrote Wednesday."

China won't budge on yuan unless U.S. insists

Washington Times

• Comment: "With the "voluntary-ist" and multilateralist arguments so obviously in tatters, President Obama and the Democratic-controlled Congress are out of excuses for continued China currency inaction. Every day they delay responding to a brazenly predatory practice that keeps destroying American businesses and jobs will reinforce the politically explosive impression that they're stalling not for tactical reasons, but to curry favor with outsourcing multinational corporations — whose China production benefits handsomely from currency manipulation, too."

U.S.-China Trade: How Long Will the U.S. Be China's Doormat?

Huffington Post

• Comment: "The proof that this particular hangover continues, however, is that since China's promise to President Obama to let the renminbi float to its 'natural level', despite a pitifully low 0.8% rise against the dollar within the first two weeks after the promise was made, China has recently purposely pushed the yuan exchange rate back to its June level. At this rate, China will take longer to remedy its currency manipulation than it takes for Hell to freeze over."

U.S. Spends, China Benefits

Forbes

• Comment: "The former chief Asia-Pacific economist for Morgan Stanley argues that American stimulus just ends up helping the Chinese economy--and hurting our own. "Just as water flows down," he writes, "stimulus affects low-cost economies more, wherever it is initiated."

The Yen’s Lesson for the Yuan

New York Times

• Comment: "AMONG the many points of tension between the United States and China, perhaps the single greatest one concerns exchange rates. For more than a decade, Beijing has kept the value of the renminbi, also known as the yuan, more or less constant to the dollar, a strategy that critics say increases the price of American exports to China and fuels the rapidly growing trade deficit with Beijing"

Factories Lose Orders, Builders Lose Confidence

Bloomberg

• Comment: "The Federal Reserve Bank of New York’s so-called Empire State factory index today showed bookings dropped for the first time since June 2009, while sales fell at the fastest pace since March 2009. The National Association of Home Builders/Wells Fargo confidence index unexpectedly declined to a 17-month low."

Here's The Trend Obama Is Fighting, If He Wants To Save American Manufacturing Read more: http://www.businessinsider.com/chart-of-the-day-manufacturing-employment-as-a-percentage-of-total-non-farm-payrolls-2010-8#ixzz0xaIHqsf1

Business Insider

• Comment: "this chart, put together by Paul Kedrosky, makes it pretty clear: as a share of total non-farm payrolls, manufacturing jobs are only going in one direction (down).What's more, it's not even choppy. It's just a straight line sloping down"

Yen rises to 15-year high versus dollar

WOUB

• Comment: "Any intervention will have limited shelf life, so now the Bank of Japan has to formulate policies which can undermine the yen's strength. This will not be easy and we could still be headed toward the 105 yen mark for euro/yen."

Door firm closing, cutting 111 jobs

Athens Banner Herald

• Comment: "Overhead Door Corp., a company that has been making garage doors in Athens for 45 years, is closing its Athens Drive facility and eliminating 111 jobs from the local economy, the company announced Wednesday."

Economic fears weigh on market

Akron Beacon Journal

America no longer needs Chinese money, for now

Telegraph

• Comment: "China is finding other ways to recycle its trade surplus and hold down its currency, buying record amounts of Japanese, Korean, Thai, and no doubt Latin American bonds"

Inside the Knockoff-Tennis-Shoe Factory

New York Times

• Comment: "In the late 1980s, multinational companies from all industries started outsourcing production to factories in the coastal provinces of Fujian, Guangdong and Zhejiang. Industries tended to cluster in specific cities and sub regions. For Putian, it was sneakers. By the mid-1990s, a new brand of factory, specializing in fakes, began copying authentic Nike, Adidas, Puma and Reebok shoes. Counterfeiters played a low-budget game of industrial espionage, bribing employees at the licensed factories to lift samples or copy blueprints. Shoes were even chucked over a factory wall, according to a worker at one of Nike’s Putian factories."

Scrutiny for Chinese Telecom Bid

New York Times

• Comment: “Sprint Nextel supplies important equipment to the U.S. military and law enforcement agencies, and it offers a broad array of devices, systems, software and services to the private sector,” wrote the group of senators, including Jon Kyl of Arizona, Christopher S. Bond of Missouri and Susan Collins of Maine. “We are concerned that Huawei’s position as a supplier of Sprint Nextel could create substantial risk for U.S. companies and possibly undermine U.S. national security.”

S. Korea free trade pact is back

Washington Post

• Comment: "Obama criticized the trade agreement as a presidential candidate but has won a commitment from South Korean President Lee Myung-bak for more concessions. Obama wants to have revisions or amendments to discuss with the Korean leader when they meet in November -- after the midterm congressional elections."

Industrial production gain not as good as it looks

Mandel Innovation

• Comment: "It turns out that over the past year, imports of motor vehicle “parts, engines, bodies and chassis” rose by 79%. Yowza.The implication is that there are a lot more imported parts and engines going into ‘American-built ‘ cars and trucks. So value-added in the domestic auto industry–which is what really matters–went up less, maybe a lot less, than 32.6%."

For a Change, U.S. Debt Is Staying in the U.S.

New York Times

• Comment: "In the first six months of this year, the Treasury numbers indicate that foreign governments reduced their holdings of Treasury securities by $10 billion. Not since 2000 — when the United States government was running a surplus and did not need additional funds — have foreign governments been net sellers for a full calendar year."

More tough economic times forecast by CBO

Reuters

• Comment: "The CBO forecast the U.S. budget deficit will hit $1.342 trillion this year, down slightly from its March projection of $1.368 trillion.It attributed most of the $27 billion change in its fiscal 2010 deficit projection to an estimated $50 billion reduction in the cost of TARP, the U.S. government's bailout of financial institutions in 2009.But the figures show that without significant changes in U.S. tax and spending laws, the government will struggle to dig its way out of a deep fiscal deficit hole."

Candy makers mad at Obama and Congress for Mexico tariff

Reuters

• Comment: "Mexico announced the new border taxes this week to put pressure on the United States to open its market to Mexican long-haul trucks, as Washington committed to do nationwide by 2000 under the North American Free Trade Agreement."

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