Los Angeles and Long Beach port complexes have been very busy lately with L.A.’s port increasing its imports by 5.25%, its exports increased 6%. Increased imports add jobs to the economy and the amount of cargo traffic is a leading indicator to the local economy.
In the L.A. Times article, it’s estimated that international trade employs 640,000 people in Southern California. That’s up from a low of just below 600,000 and below 709,000 counted in 2007.
The article attributes the strength in international trade to strong Asian economies and a weak U.S. dollar. The latest trade data indicates a level trend with the deficit running at -$48.8B. China on the other hand has a trade surplus; this helps demand for our exports. Additionally, a weak U.S. dollar makes goods cheaper to foreign countries.
Typically, a country’s trade balance is what factors significantly in the value of the currency. The past decades have been a downward spiral for the U.S. dollar with a cycle of deficits and a depreciating dollar.
Currently the nation is running surpluses with Hong Kong, Australia and Singapore while China, OPEC, the EU, Mexico, Japan, Canada and Germany are all countries to whom we have a trade deficit.
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