Commentary: U.S. exports falling at 49% pace as customers fade away

[Omaha Steve]

http://www.marketwatch.com/news/story/Global-trade-collapsing-forcing-everyone/story.aspx?guid={5E877CF4-8D66-46A2-A144-3EE1FF6F6C37}

MARKETWATCH FIRST TAKE
Global trade collapsing
Commentary: U.S. exports falling at 49% pace as customers fade away
By MarketWatch
Last update: 12:37 p.m. EDT March 13, 2009

WASHINGTON (MarketWatch) -- For a while, some analysts held out hope that the rest of the world would be spared the devastation of the collapse of the great American credit bubble. The global economy had de-coupled, they said. America's problems were her own.
No one is saying that any more.

In fact, the latest evidence shows that global trade flows are plunging at an alarming rate.

The Commerce Department reported that the volume of U.S. imports from abroad fell 4.6% in January while exports declined 8.6%, the most since the monthly trade figures were first collected in 1992. See full story.

Over the past five months since the credit crunch intensified, real exports have plunged at a 49% annual rate, while real imports have fallen at a 30% pace.

The pace of the decline is unprecedented in modern times, economists say. "We doubt even during the Great Depression that trade collapsed with such ferocity," said David Greenlaw, an economist for Morgan Stanley.

The Great Recession, as the IMF calls it, has severed a crucial link in the global economy. U.S. consumer spending has been the main engine of growth for the whole world, but that spending was based largely on phantom gains in asset prices that were inflated by that cheap money from abroad that has now been disrupted.

FULL story at link.

[customerserviceguy]

1. I'm scratching my head

trying to figure out just what exports might have been hurt. We already outsource plenty of manufacturing of things that we sell to other countries, that just leaves software, entertainment (movies) and food.

I would imagine the food exports might be down due to lowered economic conditions in the rest of the world, but the falling dollar should take care of that.

[Demeter]

2. Pretty Bad When Nobody Can Afford Armaments

which is about all we manufacture for export these days.

[Deja Q]

3. Oops?