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Germany's trade surplus with nothing in return

Reader comment on item: Shaken Out of Complacency by COVID-19?
in response to reader comment: This, along with the 2008 crash, suggest a more robust system should be in place

Submitted by myth (Germany), Apr 13, 2020 at 08:42

One can make almost the opposite argument from Germany's perspective. We had a trade surplus of 276 billion USD. In other words: We had the capacity to produce 276 billion worth of stuff we gave away with nothing in return but money. With this excess industrial capacity we could have eproduced stuff we actually need in the corona situation. Or we could have use the export money. We could have bought all the stuff we need in a pandemic prior to its outbreak. Yet, we sit on the money with nothing to show for it because we gave it all away for free. There is also no stuff produced we could buy with this money.

The US with its trade deficit sits on a lot of stuff it did not really pay for in terms of goods and services. Only it roved the wrong stuff in a pandemic.

If countries adapt to reach balanced trade the total number of goods produced would be maximal. Preparation for disaster comes for free this way.

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