Comments on: Don’t Ignore Foreign Trade http://www.bob-mcteer-blog.com/don%e2%80%99t-ignore-foreign-trade/ Bob McTeer's Blog Tue, 06 Jan 2009 04:04:13 +0000 http://wordpress.org/?v=2.6.2 By: Charles Karam http://www.bob-mcteer-blog.com/don%e2%80%99t-ignore-foreign-trade/#comment-8204 Charles Karam Thu, 11 Dec 2008 19:44:37 +0000 http://www.bob-mcteer-blog.com/don%e2%80%99t-ignore-foreign-trade/#comment-8204 <p>Dear Mr. Teer</p> <p>I Have read your article in the Economix “ The Impact of Foreign Trade on the Economy” I am glad that someone of your caliber agrees with my idea. In fact I am forwarding to you a copy of my letter which was intended to be sent to the President Obama. However since I couldn’t send it to the president I have sent it to Mr. Timothy Geithner, President of Federal Reserve Bank of New York. It is for the importance of the matter that I am writing to you that the GDP formula should be as follows: GDP= Consumption + Investment + Government spending + (Export- Domestic sales from imported products). There should be a clear differentiation between the Gross Domestic Product and Gross Domestic Spending and when ever GDS exceeds GDP this means additional borrowing.</p> <p>[Letter to President-elect Obama] </p> <p>Dear Mr President,</p> <p>With all due respect, I found that there is a great mistake committed by the economists when calculating the Gross Domestic Product (GDP). The problem and the mistake are in eliminating the effects of domestic sales from imported items (import X markup) on the components of the GDP which are: Consumption + Investment + Government spending + (Export-Import) = GDP, for example:</p> <p>USA estimated GDP for 2008 is $ 14.3 Trillion.</p> <p>The estimated export is $ 1.2 Trillion.</p> <p>The estimated import is $ 2 Trillion.</p> <p>When this import is sold in the USA market it is sold for at least $ 3.75 Trillion (26% of the GDP) and this is counted in the components of the GDP; there is $ 1.75 Trillion additional spending financed through borrowing; this means additional debts on the country. The real GDP formula should be: GDP= Consumption + Investment + Government spending + (Export- Domestic sales from imported products) in this case the USA estimated GDP for 2008 should be $ 12.55 Trillion. Unless the USA manages its import in a proper manner, the economy will not recover. The free enterprise system cannot resist alone the invasion of the products from a country like China. I wish the above formula can be used for the country’s benefits.</p> Dear Mr. Teer

I Have read your article in the Economix “ The Impact of Foreign Trade on the Economy” I am glad that someone of your caliber agrees with my idea. In fact I am forwarding to you a copy of my letter which was intended to be sent to the President Obama. However since I couldn’t send it to the president I have sent it to Mr. Timothy Geithner, President of Federal Reserve Bank of New York. It is for the importance of the matter that I am writing to you that the GDP formula should be as follows: GDP= Consumption + Investment + Government spending + (Export- Domestic sales from imported products). There should be a clear differentiation between the Gross Domestic Product and Gross Domestic Spending and when ever GDS exceeds GDP this means additional borrowing.

[Letter to President-elect Obama] 

Dear Mr President,

With all due respect, I found that there is a great mistake committed by the economists when calculating the Gross Domestic Product (GDP). The problem and the mistake are in eliminating the effects of domestic sales from imported items (import X markup) on the components of the GDP which are: Consumption + Investment + Government spending + (Export-Import) = GDP, for example:

USA estimated GDP for 2008 is $ 14.3 Trillion.

The estimated export is $ 1.2 Trillion.

The estimated import is $ 2 Trillion.

When this import is sold in the USA market it is sold for at least $ 3.75 Trillion (26% of the GDP) and this is counted in the components of the GDP; there is $ 1.75 Trillion additional spending financed through borrowing; this means additional debts on the country. The real GDP formula should be: GDP= Consumption + Investment + Government spending + (Export- Domestic sales from imported products) in this case the USA estimated GDP for 2008 should be $ 12.55 Trillion. Unless the USA manages its import in a proper manner, the economy will not recover. The free enterprise system cannot resist alone the invasion of the products from a country like China. I wish the above formula can be used for the country’s benefits.

]]> By: Matthew http://www.bob-mcteer-blog.com/don%e2%80%99t-ignore-foreign-trade/#comment-6938 Matthew Fri, 22 Aug 2008 00:25:52 +0000 http://www.bob-mcteer-blog.com/don%e2%80%99t-ignore-foreign-trade/#comment-6938 Terrific post! Thanks! Terrific post! Thanks!

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