Listen: U.S. trade deficit hits 10-year high in 2018 on record imports
"Is an observation to be made here as we get going with the big picture economic news of the day. Which is of course, this morning's report from the good people at the Commerce Department that our trade deficit, President Trump's favorite economic indicator. You might remember. Anyway, it grew last year to a record six hundred twenty one billion dollars. That is we imported six hundred twenty one billion dollars more stuff goods and services than we sold abroad. Here. Then is the observation that for all of those hard earned American dollars. We send overseas we get stuff in return their goods and services other countries make that we want so we buy them global trade, the often overlooked point, though, is that the trade deficit isn't some kind of profit and loss statement for the American economy report card, and it's not in and of itself a cause for concern. In fact, the trade gap last year was largely. Driven by a strong domestic economy. Marketplace's Tracey Samuelson gets us going. President Trump talks about the trade deficit kind of a lot. We have a trade deficit with almost every country in the we have a massive trade deficit with everybody. But which aging we racked up trillions of dollars in trade deficits, also known as loss we are going to start whittling that down and as fast as possible. So the fact that the trade deficit grew nearly thirteen percent just last year by his own standard. The higher deficit means he's failing. And that we're losing that other countries are taking advantage of us, but Doug Irwin economists. And trade historian at Dartmouth College doesn't actually see it that way, he says it's natural expected even at the trade deficit increased last year in general what we've seen US history is that when we have a booming economy or a growing economy trade deficit tends to either stay the same or grow. Oh, and they tend to strengthen recessions from two thousand eight to two thousand nine the trade deficit fell by nearly half counterintuitive as it may seem the growing trade deficit last year was driven by how strong the US economy was especially relative to big trading partners, like the European Union and China, Catherine man is the global chief economist at Citi group consumers are buying more because they are have higher income because they're strong labor markets, and because they got a little bit of a tax cut that makes them able to consume more. And some of it falls on imports seem thing with business businesses producing because labor markets are tight they got a little bit of a tax cut. So they import intermediate product so that they can produce goods to meet the demand in the domestic economy, and for a communist, this is all very very predictable. They saw this coming a mile away. If the US really wants to reduce the trade deficit it should. Save more says Carl Tannenbaum chief economist at Northern Trust. One of the reasons we have a trade deficit is that on average our consumers spend a lot more of their income than foreigners to saving not as fun as spending. But ten imams says it make households more stable in the long run and reduce the trade deficit. I'm Tracey Samuelson for marketplace. Well, let's put a context on this morning's trade gap. Number reminder that it's the total value of goods and services that we buy and sell overseas, Tracy was talking about goods that has actual tangible stuff that blew out our trade deficit. Well, here's the deal. The interesting part is that we've got a trade surplus in services have for decades now actually of which we sell a bunch overseas"