The sunny side of the economic street

While the U.S. dollar has been dropping like a brick vs. the euro and the British pound, it has had a positive impact on one sector of the economy — exports. Tim Rogers, chief economist at Briefing.com, calls recent export data, including third-quarter exports totaling $1.4 trillion, “fairly astounding.”

According to the September 2007 figures, imports totaled $197 billion while exports came in at $140 billion — still lower than imports but up about 14 percent year-over-year, according to Rogers.

“The weak dollar helps drive things,” he says.

This phenomenon has helped trim the mammoth U.S. trade deficit, which Rogers says has fallen about 18 percent from its all-time high of $69 billion in August 2006.

Swonk also sees continuing improvement in U.S. exports, with an 8.4-percent increase in 2008.

“It is a very robust export picture, with the dollar giving a tailwind to market-share gains,” she says.

A related boon to the economy courtesy of a weak dollar is increased foreign tourist spending.

“When you can buy Prada cheaper in New York than in Paris, it makes Madison Avenue look like a flea market to Europeans,” Swonk says.

Ken Goldstein, economist at the Conference Board, believes the U.S. will sidestep recession next year, partly because of the export boom. He is also optimistic the housing sector is nearing a bottom. Lastly, Goldstein addresses the pivotal role of the consumer.

“Two-thirds of the economy is growing by 2.0 percent,” he says. “The consumer is slow, but not stalling out.”