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Old 07-22-2015, 08:52 AM
 
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Quote:
Originally Posted by Major Barbara View Post
I frankly doubt that we agree on much of anything. ...
Major Barbara, I had no reason to doubt you understood the meaning of your posted words, (“Over on the income side of the income and product accounts, both imports and exports contribute to economic activity, jobs, wages, income, and welfare. ...”). Based upon what I assume to be our common language, I concluded that we are agreement upon what you had written.

You have less than common understanding of the English language? You did not intend to communicate the conventional interpretation of what you wrote?

You do perceive the values added due to sales promotion, distribution, or otherwise handling products within the USA do economically differ when applied to domestic or to imported products?

Respectfully Supposn
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Old 07-22-2015, 10:08 AM
 
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Quote:
Originally Posted by rruff View Post
Actually when you look at the numbers, the trade deficit results in lower production, not higher consumption. Private and fiscal debt rises, and wages and domestic investment are depressed. There is no problem with the GDP values, but an economy based on debt escalation isn't sustainable.



(due to Germany's trade balance surplus)They get financial stability, good wages, low unemployment, and higher domestic investment.

The surplus results in higher production, not lower consumption. Investment in high value added production is the requirement for prosperity.

And instead of accumulating debt, Germany accumulates assets.
R Ruff, Purchasers cannot spend the same dollars twice unless they recover their prior expenditures. GDP is gross Domestic production. USA Importers purchases are paid to foreign rather than to USA enterprises.

That’s why within in the most commonly used formulas’ (i.e. within the expenditure formulas’) for calculating GDPs, Importers’ expenditures for foreign products are deducted from total GDP’s expenditures for products. Foreign production of products does not increase USA’s GDPs. That deduction only accounts for annual trade deficits’ DIRECT detriments to their nation’s GDPs.
I take exception to your commenting in regard to trade deficits “There is no problem with the GDP values”.

Other than that line, I’m in complete agreement with your post.

Respectfully Supposn
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Old 07-22-2015, 03:31 PM
 
Location: Ruidoso, NM
5,667 posts, read 6,560,237 times
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Quote:
Originally Posted by Supposn View Post
Other than that line, I’m in complete agreement with your post.
Which line are you referring to?
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Old 07-23-2015, 01:22 AM
 
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Quote:
Originally Posted by rruff View Post
Which line are you referring to?
R Ruff, I disagree with your comment (regarding trade deficits), “There is no problem with the GDP values”.
Respectfully, Supposn
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Old 07-23-2015, 09:42 AM
 
Location: Ruidoso, NM
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Quote:
Originally Posted by Supposn View Post
R Ruff, I disagree with your comment (regarding trade deficits), “There is no problem with the GDP values”.
Respectfully, Supposn
US GDP per capita was right on the long term trendline until 2008. The problem is that the prior decade's increases went to a tiny fraction of the population, and it put us in a poor position for the future.

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Old 07-23-2015, 02:46 PM
 
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Quote:
Originally Posted by rruff View Post
US GDP per capita was right on the long term trendline until 2008. The problem is that the prior decade's increases went to a tiny fraction of the population, and it put us in a poor position for the future.
R Ruff, I don’t disagree with you.

Due to USA’s annual global trade deficits our annual GDPs have ALWAYS been less than otherwise; (otherwise being if USA were not experiencing a trade deficit during those years).
Regardless of how well or poorly an economy has or will behave, annual trade deficits are ALWAYS a drag upon their nations’ economies.

I’m pleased that USA’s per capita GDPs continue to grow. I appreciate you have found a graph expressing GDP in per capita terms. That’s actually the much more informative expression of GDP. Economic data is less meaningful when it’s expressed relative to units of currency not adjusted to reflect the currency’s differing purchasing powers during the years being described.

Although nations’ global balances of trade may be small proportions of their nation’s GDPs, their most significant affect is upon their nation’s numbers of jobs and the median wages of those jobs lost or gained.
Thus balance of trade’s affects upon their nation’s aggregate numbers of jobs and median wage is more significant, (i.e. has greater leveraged) affect upon their nation aggregate jobs and median wage, than the balances’ proportions to their nations’ GDPs.
I.e. trade balances leveraged affects upon their nations’ numbers of jobs and median wage is greater than the balances proportion to their nations’ GDPs.

USA’s numbers of jobs and median wage are the mainstay of our nation’s middle wage and salary earners. Corporations and wealth can cross national boundaries; USA wage and salary earners and their families are statistically entirely dependent upon their USA employment earnings. The benefits of cheaper imported goods do not compensate for trade deficit’s consequential effects upon their nation’s numbers of jobs and their median wage.

Respectfully, Supposn
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Old 07-24-2015, 06:07 AM
 
1,820 posts, read 1,645,285 times
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Quote:
Originally Posted by rruff View Post
You won't even engage in a substantive argument regarding the subject you claim to have so much experience in.
Only when confronted by a lack of competent partners.

By the way, income and product are actually the same thing. But the components of GDP by disposition -- consumption and investment expenditures by persons, businesses, and governmental units -- include some items that were imported while excluding all items that were exported. An addition of net exports is plainly necessary to bring the product numbers back into conformance with the income numbers. Shouldn't be that hard to understand.

Last edited by Major Barbara; 07-24-2015 at 07:01 AM..
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Old 07-25-2015, 08:38 AM
 
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Quote:
Originally Posted by Major Barbara View Post
... By the way, income and product are actually the same thing. But the components of GDP by disposition -- consumption and investment expenditures by persons, businesses, and governmental units -- include some items that were imported while excluding all items that were exported. An addition of net exports is plainly necessary to bring the product numbers back into conformance with the income numbers. Shouldn't be that hard to understand.
Major Barbara, is product a typographical error? Did you intend to write the word “production”?
Income and production are not quite “the same thing”.
USA has TOO OFTEN experienced increases of production that were not then or later reflected within our nation’s wages and salaries.

I did (with difficulty) understand your post and determined it to be incorrect.

Net trade balance certainly is a component of their nation’s GDP.
Annual trade surpluses increase and trade deficits decrease their nation’s GDP.
Calculation of a nation’s GDP includes rather than excludes the value of both the nation’s imports.

Net trade balances’ consequences upon their nations are understated to the extent that all export supporting production expenditures are not entirely paid for by their producers.

Although all direct and indirect production contributes to their nation’s GDP, some are not entirely paid for by the product’s producers and thus are not reflected within the prices of their products.
Although all production is captured within the accounting of GDP, to the extent that domestic production supporting expenditures are not entirely paid for by the producers of exported products, they are not entirely reflected within the prices and values of those exported products.

Thus to that extent the contributions to GDP attributable to their nation’s exports are to some extent understated.

A nation’s imports are the exports of some other foreign nations; thus a nation’s net trade balance,
(i.e. effect upon GDP attributable to their nation’s net trade balance) is understated; t o that extent the contributions of nation’s trade surpluses to their GDP, or the detrimental effect of nation’s trade deficits to their GDP are understated).
Refer to the first post of this thread for an expanded explanation of these understatements.

Respectfully, Supposn
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Old 07-26-2015, 06:57 PM
 
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Quote:
Originally Posted by Supposn View Post
Major Barbara, is product a typographical error? Did you intend to write the word “production”?
You are apparently unaware of the fact that GDP stand for Gross National Product or that the number itself comes from the product side of the National Income and Product Accounts. This is like stuff from Square-1. You should go back there and try again.
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Old 07-26-2015, 09:16 PM
 
1,959 posts, read 1,290,042 times
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Quote:
Originally Posted by Major Barbara View Post
You are apparently unaware of the fact that GDP stand for Gross National Product or that the number itself comes from the product side of the National Income and Product Accounts. This is like stuff from Square-1. You should go back there and try again.
Major Barbara, previously you posted:
“By the way, income and product are actually the same thing. But the components of GDP by disposition -- consumption and investment expenditures by persons, businesses, and governmental units -- include some items that were imported while excluding all items that were exported. An addition of net exports is plainly necessary to bring the product numbers back into conformance with the income numbers. Shouldn't be that hard to understand”.

My response corrected your equating income and production. GDP is a statistical description of GDP, (i.e. gross domestic product) which necessarily requires domestic production of products.

The word “income” does not equate to product” or to the production of products. Additionally I corrected what seemed to be a statement that production for export was not included within calculation of the nation’s GDP.

I suppose you’re well aware of this all. Why are you continuing to argue otherwise?

Respectfully, Supposn
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