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Orbitz Honors Customers' Favorite Hotels With 'Best In Stay' Awards - FOXBusiness

May 15, 2007 - Posted in Deals, Expedia Travel, Shows, Travel business

Everyone would agree they see more "Made in Taiwan/China/Japan/etc..."tags than "Made in the USA" tags for the past several
years. Well, that "Made in _____" tag on your clothing has an economic term sewn into it: trade deficit. A trade deficit happens
when one country buys more goods than it sells to other countries.
For example, if the entire United States (all 300
million of us) made only 100 shirts this year, and if all of China made 100 shirts, some of those shirts would be traded between
us- we would sell a few to China, and vice versa. But a trade deficit happens when one country sells more shirts than another.
China, in this example, could sell 85 shirts to America. The U.S. could sell 55 shirts to China. So, in this trade, China
sold more shirts to the United States, 30 more in fact.
Most businessmen and economists believe that most trade deficits
aren't a bad thing; it's just part of trade, and at some point trade between two countries should balance out eventually.
The
big exception is the U.S., which buys vastly more stuff than it sells, and has done so for decades.
Why does this matter?
Well, in order to buy those shirts, you need money. And if you are buying more shirts than you're selling shirts, you're losing
money. If you're a business, you won't be in business much longer.
But, countries aren't businesses. They are, well,
countries, and can print all the money they want. People who deal with currencies, or each country's version of money, look
at trade deficits as one way to find out how much each country's currency is worth. If you have to print more money, each
dollar you print can possibly lower the value of the other dollars out there. Like stocks, you can buy and sell currencies
on what's called the foreign-exchange market (or, if you want a buzzword for the office, say Forex market).
Well, because
the U.S. has been buying a lot of stuff from China for many, many years, China holds a lot of U.S. dollars. If China were
to sell those dollars on the market at some point, well, it wouldn't be very good. The U.S. dollar's value would fall -- making
imports and traveling abroad much more expensive.
Trade deficits are usually a good thing, because it shows that the
global economy is working. It's just when a trade imbalance gets too high where economists and investors start to become concerned.

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