Can you see where I am coming from on this margin thing?
It's about the total value of goods as opposed to just dollar ammounts shipped back and forth.
How would this affect your outlook on global trade, if at all?
- $100.00 of American goods, to be sold at $125.00 on the foreign market (profit of $25.00)
$25 flows into our domestic economy. - $50.00 of Chineese goods sold on the American market? (sold for $100.00, profit to US companies of of $50.00)
$50 flows out of our domestic economy.
In your hypothetical scenario, the second situtation may be more profitable for the company, but not necessarily for our economy, paid to the Chinese.