The U.S. Is Selling More Stuff Than Ever To The Rest Of The World
The economy is not doing well. Unemployment is high, homes are worth what they were in 2003, and growth is weak.
But one sector is doing great: exports. They've been growing about four times as fast as the overall economy since the beginning of 2010.
This is part of a longer-term trend. Despite the myth that the U.S. doesn't make anything anymore, U.S. exports have actually been contributing a larger and larger share of the U.S. economy since the 1970s.
What's going on?
A recent note from the Cleveland Fed points to a few factors.
1. A long-term decline in global trade barriers (tariffs, quotas, etc.). The U.S. now has free trade agreements with 19 nations, from Singapore to Oman to Peru.
2. Many poor countries are getting richer. That means millions more customers for American goods. U.S. exports to China quadrupled over the past decade. Middle class Mexicans are shopping at Costco. Etc.
3. The value of the dollar is declining. A "weaker dollar" sounds bad (and it does make imports more expensive), but it actually makes U.S.-made goods cheaper overseas, which tends to boost exports.