Asset Management Tips

The smaller-than-expected trade gap will likely prompt economists to raise their estimates of fourth quarter U.S. economic growth.

In the quarters ahead, the real (price-adjusted) trade deficit will narrow further as U.S. consumers are grappling with labor. market softening, plunging home prices and financial market turmoil, said Dimitry Fleming, economist at ING financial markets.

External demand

Meanwhile external demand is still robust, at least in Asia and Latin America. The dollar's weakness should also be helping US exporting companies. This should further push the US trade deficit down.

The figures that exports of goods and services set a record in December, pushing the total for the year to a record $1.62 trillion. read more

I hate to bash Fed Chairman Ben Bernanke, but I'm going to for a few pages. Here's the deal. The current economic threat is screaming for an aggressive inflation solution. Inflation comes from the Fed. Forget about the inflation the Fed has caused over the past 90 years, and the doubling of the money supply to goose markets for the past eight. A lot of that was dead wrong, a theft of our children's future, coming at an unnecessary time. However, when economic crises hit, the government must inflate. Must. Aggressively, preemptively, not reactively, or else calamity will strike, deflation will result, a black hole sucking until depression hits. It is a lot easier to stop inflation during boom times than to reinflate an economy during a major bust. Japan taught us that. Ironically, this is supposed to be Bernanke's strong suit. read more