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Quotation of the Day…

… is from page 477 of the 5th edition (2015) of Thomas Sowell’s Basic Economics:

unknownSlippery words can make bad news look like good news and vice versa.  For example, the much-lamented international trade deficit of the United States narrowed by a record-breaking amount in the spring of 2001, as Business Week magazine reported under the headline “A Shrinking Trade Gap Looks Good Stateside.”  However, this happened while the stock market was falling, unemployment was rising, corporate profits were down, and the total output of the American economy declined.  The supposedly “good” news on international trade was due to reduced imports during shaky economic times.  Had the country gone into a deep depression, the [deficit in the] international trade balance might have disappeared completely, but fortunately Americans were spared that much “good” news.


Do not forget that the Greatly Depressed 1930s was a decade of American trade surpluses.


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