For years, Americans have complained about their jobs being moved overseas where manufacturing costs have been much lower.
But with labor costs now rising overseas and energy costs falling in America, there is now excitement that an American manufacturing renaissance is at hand.
Unfortunately, there is no good evidence to suggest this is happening. In fact, some data suggest the opposite is happening.
"Evidence for a structural renaissance is scant so far," writes Goldman Sachs' Jan Hatzius.
And even if we could bring manufacturing back, is that what we really want? When manufacturing comes back, so does pollution.
Furthermore, the idea of reindustrialization represents the end of a mega-bullish secular trend for earnings.
The idea of an American manufacturing renaissance is a nice one. But the charts we looked at suggests its actually a combination of fiction and misfortune.
US exports should be growing as a share of global exports if there were a manufacturing renaissance. This is not happening.
"The picture shows that US exporters have only tended to gain share following significant dollar depreciations. There has been no discernible change in this relationship in recent years. If anything, US export performance has tended to fall short of what one would have expected based on currency movements."
Source: Goldman Sachs
US and euro area exports are moving together closely, suggesting no change in competitive advantage.
"...U.S. export performance looks only middling even if we restrict our attention to European trading partners. Exhibit 6 compares real export growth for the U.S. and the Euro area, stripping out intra-Euro area trade in order to avoid contamination by the weakness in Euro area domestic demand. The two series continue to track one another closely, suggesting that both are driven by the global trade cycle as opposed to structural changes on one side of the Atlantic or another."
Source: Goldman Sachs
US manufacturing job growth has decelerated sharply, and it's actually growing much more slowly than the rest of the labor market.
Source: BLS, Marketwatch
See the rest of the story at Business Insider
Please follow Money Game on Twitter and Facebook.