Please answer both questions. The second subject is really interesting, greatfully answer both question. Thank you!
1. So, how does the US get income to compensate for the imports, the production abilities do not have scarcely sufficient to change the traffic deficit?
The US goes in to debt each year since it imports products as well as can’t compensate for them since it has not done sufficient income by exporting products to change the deficit.
2. If the income to compensate for the alien products is borrowed by the sale of Treasury Bonds transferring the debt the US owes in to Treasury Bonds, how does the US compensate behind the income it has borrowed as well as again, where do consumers get the income to outlay upon products when the nation doesn’t have sufficient income to buy products to proceed with?
Question created upon May 3, 2009 (I hold it was May 3, it was possibly May 3 or May 4, some-more expected it was upon May 3)
Question was created upon May 3, 2009
{ 2 comments… read them below or add one }
1.most of the countries that import to us reinvest in our financial system and property we also export many cars, most of the heavy construction equipment used in the world is made in the U.S., many of the nuclear and other power plants are developed and purchased from U.S. corporations most of the commercial jets used in the world are made in the U.S. most militarys around the world use some if not all U.S. made equipment, I do agree though that our trade deficit is rather large.
2. In the 1970’s President Nixon got rid of the gold standard which basically means the dollar is as good as the world feels it is since the U.S. is the largest consumer in the world in order for the countries that import to us to continue to do so they have to accept dollars and continue to do what I mentioned in 1.
try to check on this site http://en.wikipedia.org/ there you find your answer…