United States commerce department says trade deficit hit 10-year high in 2018

Trump dealt blow as US trade deficit jumps

US stocks lost ground after the country's trade deficit widened in December and the shortfall with China worsened, despite US President Donald Trump's tariffs.

The bulging deficit numbers come as U.S. and Chinese officials say they are nearing a breakthrough in talks to end their trade war.

Trump announced in a Twitter post last month that he would delay another planned increase in tariffs on $200 billion worth of Chinese goods that was originally set for 1 March. When We purchase more German or Chinese or whoever's goods than they purchase of ours they have a whole lot of USA dollars - which they use to invest in our economy, create jobs and generate more wealth.

Christine McDaniel of the Mercatus Center at George Mason University says that should come as no surprise, given that the US runs a low saving rate and a very high consumption rate compared to other large economies like China. A few months back, he imposed a 10 percent tariff on an additional $200 billion and said that number would rise to 25 percent on January 1st if China did not agree to USA trade demands. And that, Cohn explained to the president, is a good thing, as folks buying less expensive goods with a stronger dollar have more money to spend on services, which make up more than 80 percent of our gross domestic product. Economists widely agree that Trump's emphasis on the trade balance is misplaced, because that number reflects broader economic factors, mainly the gap between a nation's investment and savings. During his tenure in the White House, Cohn tried and tried and tried again to get the president to understand that many of his economic views - on free trade, on manufacturing, on tariffs - were flat-out incorrect.

Trump often misrepresents the trade deficit.

China has offered to buy a reported US$1.2 trillion in additional American products over the next six years in a deal that reportedly would ease each side's tariffs, usher in changes to Beijing's state-led economic model and include tough new enforcement mechanisms. Democrats, if they play this smart, have a chance to make the case Trump is too ignorant and gullible to protect the well-being of US consumers, workers and producers.

The high dollar acts as a price increase for American exporters, making it harder to compete with foreign rivals.

North Carolina's Roy Williams collapses on sideline due to vertigo
The game portion of the night ended on a good note for North Carolina, which was led by Coby White's 28 points and six 3-pointers. The Tar Heels have won 10 of 11 and 20 of 22 against Clemson, though the Tigers claimed the teams' meeting last season 82-78.

Researchers at the New York Federal Reserve examined this issue previous year. -China trade dispute, slowing global demand and a strong dollar, which is making American-made goods less competitive on the worldwide market.

Economists expect exports to remain weak even if Washington and Beijing strike a trade deal.

And therein lies the catch that exposes Trump's goal of trying to rally markets on a deal: A turbocharged equities market could very well revive Fed rate-hike bets for 2019. This action turned out to inflate the trade gap.

But trade battles do have consequences.

The Gallup Organization's Megan Brenan reports Trump's rating for handling the economy, 56 percent, is the highest of his presidency and the highest of his approval ratings on any of 14 domestic and foreign issues tested in the latest Gallup poll.

European Union trade commissioner Cecilia Malmstrom is in Washington this week and met on Wednesday with United States trade representative Robert Lighthizer as they prepared for formal negotiations. Trump has complained that a stronger dollar has weakened his hand in his trade wars and put a damper on USA growth.

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