"...U.S. affiliates reported record quarterly earnings in 14 countries."

This is an interesting piece on trade, Forget About the U.S. Trade Deficit?:

...One of the most dangerous deficits today is not one of trade — but rather a deficit in understanding how U.S. firms compete and sell products in the world marketplace.

Simply put, American firms compete more through foreign direct investment — they establish a local presence in international markets by operating on the ground — than through arm’s-length trade.

In 2001, for instance, the last year of available data, U.S. foreign affiliate sales topped nearly $3 trillion — roughly three times larger than U.S. exports of goods and services. Because foreign affiliate sales are not included in U.S. exports, a great deal of global commerce is missing from the reported trade figures...

I'm not enough of an economist to judge this, but it sounds promising... (via Judd)

Posted by John Weidner at July 3, 2004 12:29 PM