Although economists have studied the sensitivity of import and export volumes to changes in the exchange rate, there is still much uncertainty about just how much the dollar must change to bring about any given reduction in our trade deficit.
More Quotes from Martin Feldstein:
Household saving fell from 2.5 per cent of after-tax income in the third quarter of 2003 to a remarkable minus 1.8 per cent two years later.Martin Feldstein
To finance this trade deficit, the U.S. has to borrow from the rest of the world or sell American assets like stocks, businesses, and real estate to the rest of the world.
Martin Feldstein
Increased government spending can provide a temporary stimulus to demand and output but in the longer run higher levels of government spending crowd out private investment or require higher taxes that weaken growth by reducing incentives to save, invest, innovate, and work.
Martin Feldstein
Even if the dollar does decline during the coming months, the delays in the response of exports and imports to the more competitive dollar will mean that the increase in aggregate demand from this source may not happen for a year or more.
Martin Feldstein
And when the dollar decline makes foreign travel much more expensive, I will do more of my vacation traveling in the United States.
Martin Feldstein
With sound monetary policy, the increases in import prices are offset by lower inflation for domestically produced goods and services.
Martin Feldstein
Readers Who Like This Quotation Also Like:
Based on Keywords: economists, import, sensitivity, uncertaintyI still have a passion for the music, which is such a beautiful thing. I still wake up in the middle of the night out of a dream and have a melody in my head, and run to my piano.
Teena Marie
Smiles form the channels of a future tear.
Lord Byron
A waffle is like a pancake with a syrup trap.
Mitch Hedberg