U.S. Trade Deficit

• Explain what the US Trade Deficit is.

• The U.S. Trade Deficit is a negative balance of trade in the United States.

• Why did it go down in December 2007?

• The US Trade Deficit decreases in December of 2007 because of an increase in exports.

• What does the value of the US dollar have to do with the trade deficit falling?

• Since the dollar is at a record low, the trade deficit failed because of the exportation of goods to foreign companies.

• Why do you think that a large trade deficit is bad for the economy?

• A large trade deficity is bad for the economy because we aren't making enough money to pay for the incoming goods.

• In other words: why is it bad to import more goods than you export?

• The more goods we import means that we have to have more money to pay for them. This money comes from the exportation of our goods.