They are meaningless, goods trade for goods.
According to Thomas Sowell (everybody here PRETENDS to read him for obvious reasons), and Walter Williams, and Milton Friedman, and Steve Landsburg there is no such thing as a trade deficit (they are correct). I’ll let doubters read those men in their own words for the simple explanation.
Continual large surpluses are also not good. You might end up like China, building ghost cities and misallocating capital, finally forced to revalue their currency anyway. Or like Germany, who created the Euro to juice their export markets. It worked too well, now they have to either finance their trading partners, see them leave the Euro, or leave the Euro themselves. Or you might end up like Saudi Arabia, a few at the top get to spend the money while the rest live of a government dole. When the oil runs out, so will the false prosperity.
Since the US has run large trade imbalances for decades, you might ask why it hasn't ended up like Greece. There are several reasons, the primary ones are: the role of the US dollar as the primary reserve currency, the perception of the US as a "safe haven", the size and strength of the US economy, and a AAA credit rating, until now.
Are trade deficits good or bad? There is no correct answer.
when they are paid for with backed-by-nothing pieces of paper, in exchange for TV’s and plastic toys from Asia, its probably bad for everyone - including those left holding the dollars!
Historically, our manufacturing, gdp and employment increase the most when our trade deficit is expanding the fastest.
They give us goods and services and we give them dollars. They can either use those dollars to buy our goods and services or invest in our economy. Either way, it's good for us.
What’s a trade deficit? Why do we care?
When the US has an unfavorable balance of payments with another country, that country has more funds to invest in America and buy our products.A massive inflow of foreign funds is beneficial to capital accumulation in America and economic development of America in the long run.Any decrease in the money supply of America by a negative balance of payments can be replenished by creating money out of thin air.
Neither, they’re just a thing. And these days it’s a thing that’s especially meaningless because software and entertainment (two of our biggest exports) are not considered in the math, so significant parts of inbound revenue don’t count.