Trade data point to a V-shaped recovery

Trade figures for July confirm what we already knew: the U.S. and the global economy are recovering. Our exports are up at a 25% annual pace since hitting a low in April, which can only mean that global commerce is back and making up for the ground lost last year. U.S. imports are up at a 29% pace over the same period, a good sign that consumers are getting back on their feet and recovering their confidence. The strength of the bounce from the lows also confirms that this is a V-shaped recovery.

But even though this is a V-shaped recovery, it will still take us a long time to get back to where we were a year ago. For example, even if exports continue to grow at a 25% annual pace, it would take about 18 months for them to rise to the levels we saw in July of last year. As long as the economy remains below the levels of a year ago, this is going to feel like a disappointing recovery, even though the pace of improvement could continue to be fairly rapid.