WORLD TRADE IS FALLING

The recent stock market fall appears to be in reaction

to weakness in foreign economies, not domestic developments

in the US.

 

WORLD TRADE

 

One measure to watch is world trade.

from December to May world trade volume fell -3.4%.

Interestingly, in the first five months of the 1971

decline trade fell -3.5%, essentially the same as this drop.

The year over year growth rate is 0.4%.  The year over year

change in world trade has only turned negative twice sine 1990,

as far back as this data series goes.  For what it is worth

those two declines also coincided with US recessions.

For now, the critical question is how much of the weak growth

abroad impact US growth. Almost certainly the impact is likely

to be significant.

 

 

 

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