Nation Trade and Finance Speech.
Nation Trade and Finance Speech
Nation Trade and Finance Speech
Welcome to the House reporters. The aim of this speech is familiarize you with the present state of the U.S economy. In terms of macro-economic elements, the United States has taken a stand between continuous inflation and slowdown of inflation. There are numerous determinants that show a stable economy, such as residential investment and housing prices. My discussion focuses on whether the U.S government encounters critical issues with the reduced pace and fall in recession, the imports that are predominantly brought into the country, their effect on economy, the exchange rates, how they are determined, and whether the US government should minimize the imports from China.
Ladies and gentlemen, imports refer to the products and services that are brought into a given nation from another country. Surpluses are anything in excess quantity or amount of what is actually needed out of what is produced. In case there is an import surplus being brought into the United States compared to fewer exports out of the country, a balance of trade deficit will be established. Besides, when imports are more than exports, the international demand for the U.S products and services become less than other countries’ demand. As a result, this creates a net resultant demand for the products and services from foreign countries. An illustration of a product with an import surplus is the imports of dairy products and dairy ingredients into the United States. There has been a notable increase in the importation of proteins and dairy ingredients, which has resulted into a significant decline in demand for the US manufactured dairy products to drop tremendously. California is highly known as the largest producer of dairy products, but its processing capacity has sharply declined due to the importation.
Ladies and gentlemen, international trade does always work to influence factors such as GDP, local markets, and the university students. International trade helps international college students obtain education in other countries due to different trades in currency. When carrying out international trade, GDP increases when the net exports are positive and decreases when the net exports are negative. America’s trade deficit in products and services declined to $38.5 billion in December from $48.6 billion as imports declined, and the exports increased (Ahearn, 2013). The United States government cannot stop the importation of products from China, neither can it minimize the importations from other countries, because if it does, China might stop importation of American products, and the businesses in the United States will lose accessibility to the emerging markets in the world. Besides, there is a possibility that China or any other country might interpret it as a threat to its economy and desire to retaliate. Eventually, the cost of goods will likely increase, and more individuals would lose their jobs, leading to high unemployment rate.
International currency exchange rates refer to that the amount of one unit of a given currency can be converted to another currency. The exchange rates can be floating rates, which vary on a continuous basis based on various aspects. They can also be pegged to another strong currency where they still float, even though they vary in cycle with the currency, which they are actually pegged to. Being informed about the value of a given currency, especially the home currency in connection to international currency, helps the shareholders or investors assess their investment valued in dollars. For instance, from the perspective of the US investor, knowing the exchange value for Dollars to Euro is critical in assessment of the European investments and projects. A falling value of the US dollar has the likelihood of increasing the value of foreign based projects; in the same way, increasing value of US dollar would actually have destructive effects on the foreign investors’ wealth.
The currency rates of exchange are determined by the forces of market demand and supply. The amount of currency in demand, in connection to the amount of currency in supply, will shape the exchange rates in association with another currency. For instance, in case the demand for the US dollars by European investors goes up, the demand supply relationship will result into a hike in price of the US dollars in comparison with the Euro. Other determinants of currency exchange rates include economic news, geopolitical news, which influences currency between two states while others include rates of interest, unemployment rate, GDP, reports on inflation, and information about manufacturing prospects.
According to Shimko (2013), the government’s choices with regard to tariffs and quotas have a significant influence on the international relations and trade. For example, since tariffs are taxes, the government might decide to impose a certain percentage of tax to goods from certain countries compared to other states. The decisions depend on whether the states belong to a given trading block or the relationship between the countries. Law tariffs and quotas encourage trade between two countries while high tariffs discourage trade between two countries. Ladies and gentlemen, it is my belief that the state has the responsibility to impose tariffs depending on the accrued benefits to local traders and the economy.
Ahearn, R. (2013). International trade and finance: Key policy issues for the 12th Congress. California: Diane Publishing.
Shimko, K. L. (2013). International relations: Perspectives, controversies and readings. Boston, MA: Wadsworth