The Trade Deficit and Exchange Rates

Since the U.S. Dollar is weak, shouldnt that imply we export more than we import (i.e., foreigners get a good exchange rate making US goods relatively cheap)? So why does the U.S. have an enormous trade deficit? Trade Balance, Surplus, and Deficit Parkin and Bades Economics Second Edition defines trade balance as: The value of all the goods and services we sell to other countries (exports) minus the value of all the goods and services we buy from foreigners (imports) is called our trade balance If the value of the trade balance is positive, we have a trade surplus and we export more than we import (in dollar terms). A trade deficit is just the opposite; it occurs when the trade balance is negative and the value of what we import is more than the value of what we export. The United States has had a trade deficit for over the last ten years, though the size of the deficit has varied during that period. We know from A Beginners Guide to Exchange Rates and the Foreign Exchange Market that changes in exchange rates can greatly impact various parts of the economy. This was later confirmed in A Beginners Guide to Purchasing Power Parity Theory where we saw that a fall in the exchange rates will cause foreigners to buy more of our goods and us to buy less foreign goods. So theory tells us that when the value of the U.S. Dollar falls relative to other currencies, the U.S. should enjoy a trade surplus, or at least a smaller trade deficit. If we look at the U.S. Balance of trade data, this doesnt seem to be happening. The U.S. Census Bureau keeps extensive data on U.S. trade. The trade deficit does not appear to be getting smaller, as shown by their data. Here is the size of the trade deficit for the twelve months from November 2002 to October 2003. Nov. 2002 (38,629)Dec. 2002 (42,332)Jan. 2003 (40,035)Feb. 2003 (38,617)Mar. 2003 (42,979)Apr. 2003 (41,998)May. 2003 (41,800)Jun. 2003 (40,386)Jul. 2003 (40,467)Aug. 2003 (39,605)Sep. 2003 (41,341)Oct. 2003 (41,773) Is there any way we can reconcile the fact that the trade deficit is not decreasing with the fact that the U.S. Dollar has been greatly devalued? A good first step would be to identify who the U.S. is trading with. U.S. Census Bureau data gives the following trade figures (imports exports) for the year 2002: Canada ($371 B)Mexico ($232 B)Japan ($173 B)China ($147 B)Germany ($89 B)U.K. ($74 B)South Korea ($58 B)Taiwan ($36 B)France ($34 B)Malaysia ($26 B) The United States has a few key trading partners such as Canada, Mexico, and Japan. If we look at the exchange rates between the United States and these countries, perhaps we will have a better idea of why the United States continues to have a large trade deficit despite a rapidly declining dollar. We examine American trade with four major trading partners and see if those trading relationships can explain the trade deficit:

Inventories and Cost of Goods Sold Essay Example

Essays on Inventories and Cost of Goods Sold Essay The paper "Inventories and Cost of Goods Sold" is a great example of an essay on finance and accounting. Students face difficulty in understanding the difference between the physical flow of inventory and the cost flow assumption because the cash flow does not consider taxes in its computations unlike the physical flow of inventory (Greenberg Wilner, 2011). This arises because taxes are not permanently reduced, but deferred. It implies that the reduced amount will still be remitted to the tax authorities after the decrease in the cost of inventory. It is also apparent that the deferred tax owed by an organization is beneficial during inflationary periods since it reduces net income. Another reason that causes confusion between the physical flow of inventory and the cost flow is the earnings in which costs are charged off against current revenues (Greenberg Wilner, 2011). This takes place during inflationary periods when prices of goods are high and the company tends to reduce its c osts by hiking charges. It is also evident that the cost flow assumption is different from the physical flow of the products because a firm can turn around inventory through the sale of its oldest units first and then run the overheads using LIFO or weighted average (Greenberg Wilner, 2011). This suggests that firms normally switch cost flow assumption from FIFO to LIFO during inflation. As a result, spreading the current higher overhead costs into the cost of goods sold (COGS) on the income statement and tax return reveals a positive net income and less payable returns. In this regard, the disparity evident between the physical flow of inventory and the cost flow assumption relates to the taxes and net income that a firm attains to achieve when prices are higher in the market (Greenberg Wilner, 2011).

The DaVinci Code Free Essays

The Da Vinci Code is creation of Dan Brown’s mental regime or a fact. It is for the people to decide whether these theories belong to Brown’s imagination or the skeleton of ‘facts’ that supports the book. The early church history just can’t stay out of the news. We will write a custom essay sample on The DaVinci Code or any similar topic only for you Order Now The DaVinci Code contains many more claims about Christianity’s historic origins and theological development. Almost every thing our fathers told about Christ is false. Brown argues a single meeting of bishops in 325, at the city of Nicea in modern-day Turkey. There, church leaders who wanted to consolidate their power base created a divine Christ and an infallible Scripture-both novelties that had never before existed among Christians. One of the key points put forward by Brown as Da Vinci code truth is that the Bible cannot be trusted. Certain portions of the literature that Brown proclaimed as ‘Bible’ do have fallacies. The early books called the Gnostic Gospels often disagree with the inspired gospels of God’s Word. The Da Vinci Code novel involves a conspiracy by the Catholic Church to cover up the â€Å"true† story of Jesus. In the book, the Vatican knows it is living a lie but continues to do so to keep itself in power. The novel has helped generate popular interest in speculation concerning the Holy Grail legend and the role of Mary Magdalene in the history of Christianity. Fans have lauded the book as creative, action-packed and thought-provoking. Critics have attacked it as poorly written, inaccurate and creating confusion between speculation and fact. From a religious point of view, some critics consider it sacrilegious, and decry the many negative implications about the Catholic Church and Opus Dei. Negating any deep rooted belief after 20 centuries is very difficult, if we see the other side of story. It is more difficult for those who have attained certain level in spiritual world through Christianity. It is a matter of debate as who were the gainer-Bishops or society. Christianity is just a path or media to gain spiritualism. It is not important which path you choose to gain spiritualism. Christianity or any religion in the world is for betterment and to provide a clean society. Sanctity of the Bible; Incomplete input gives out a wrong output The Bible’s composition and consolidation may appear a bit too human for the comfort of some Christians; Brown claims â€Å"the Bible did not arrive by fax from heaven† In The Da Vinci Code, Brown apparently adopts Arius as his representative for all pre-Nicene Christianity. In reality, early Christians overwhelmingly worshipped Jesus Christ as their risen Saviour and Lord. Before the church adopted comprehensive doctrinal creeds, early Christian leaders developed a set of instructional summaries of belief, termed the â€Å"Rule† or â€Å"Canon† of Faith, which affirmed this truth. With the Bible playing a central role in Christianity, Brown claims that Constantine commissioned and bankrolled a staff to manipulate existing texts and thereby divinize the human Christ.. But some people may argue; at this stage, it is impossible to collect sufficient input to arrive on any concrete conclusion. It’s a universal fact that none of us has seen Jesus Christ. It is hard to believe unless we witness. We draw a conclusion based on available inputs, which may further have many variables. Bible’s composition and consolidation was necessary to communicate many and into its correct form. Bible draws a line between rights and wrongs, Do’s and Don’ts or in other words it provides a proven track for the people to follow and help them to take their own judgment in day to day life. People are wondering if Brown’s book contains Da Vinci truth. The introductory note of the book says, â€Å"all descriptions of documents and secret rituals are accurate. † Is this a true statement? Is there such a thing as Da Vinci Code truth? So how much of The Da Vinci Code is truth? When asked how much of his book is based on â€Å"reality in terms of things that actually occurred,† author Dan Brown said, â€Å"Absolutely all of it. Although Brown claims that the book is filled with truths, the people must keep in mind that this claim is included in the first paragraphs of a fiction book. Even claims that something is true, when found in a fiction book, are still fiction. If Brown had truly wanted to enlighten the world about his true nature of Jesus and the Catholic Church, he would have done so in a non-fiction setting. Why then did Brown assert in interviews that the information contained within his book was true? Booming of ‘The Da Vinci Code’ and Christianity; A logical analysis The Da Vinci Code proves that some misguided theories never entirely fade away. They just reappear periodically in a different disguise. Brown’s claims resemble those of Arius and his numerous heirs throughout history, who have contradicted the united testimony of the apostles and the early church they built. Those witnesses have always attested that Jesus Christ was and remains God himself. It didn’t take an ancient council to make this true. And the pseudo historical claims of a modern novel can’t make it false. Some Christians have optimistically hoped that The Da Vinci Code might provide a potential opportunity for dialogue and discussion about Jesus with people who might not otherwise be open to such discussions. Booming of Da Vinci code may have many reasons. It may not be wise to correlate its sale to acceptance of the people- for some people it’s a novel, some want to analyze and do the self assessment of their faith and for some it may be of academic interest. Threat to Christianity is beyond imagination. The reason being; the very first question is about existence of God. If the answer is ‘No’ then there may arise millions of questions to which today’s world still in search of an answer. If the answer is ‘Yes’ then there has to be certain rule and requires source and some media to communicate. Unless, the source is either ‘Supernatural’ or ‘Super human’, it is hard for the people to rely on it. We find Jesus Christ exactly fits into this place. Therefore The Da Vinci code can never ever be a threat to Christianity. References 1) Dan Brown, The Da Vinci Code; Doubleday (USA); 2003 2) The Da Vinci Code, Special Illustrated Edition, Doubleday; November 2, 2004, How to cite The DaVinci Code, Papers

Amazing Grace by Celtic Thunder free essay sample

Amazing Grace is sang by Celtic Thunder for their Christmas show that they did. The song has been popular in the country of Ireland for more than a century. Its a Christian hymn that was published in 1779 and written by John Newton. Its also a song thats been recorded by many other singers too. Including: Andre Rieu, Celtic Woman, Elvis Presley, Il Divo, and Elvis Presley. Amazing Grace appears on their DVD Christmas and their CD Its Entertainment. Ive listened to a bunch of versions of Amazing Grace but I think that their version is the best out of any of the others Ive listened to. Its my favorite version because I just love how Damians newly deep voice is featured in the song. Also, I just love how they all harmonize during the song too. You can actually find their version of the song on their YouTube channel titled Thundertube. We will write a custom essay sample on Amazing Grace by Celtic Thunder or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Their video of them singing actually went viral too.