Money: How the Destruction of the Dollar Threatens the Global Economy – and What We Can Do About It

CHAPTER 3

Money and TradeA Deficit in Understanding

      International transactions are always in balance, by definition . . . for every buyer there is a seller. But different items in the great circle carry different labels. . . . The mystery is why we even collect these figures; if we kept similar statistics for Manhattan Island, Park Avenue would lie awake at night worrying about its trade deficit.

—ROBERT BARTLEY, The Seven Fat Years

THE BUREAUCRATS WHO SET OUR MODERN MONETARY policies are in many ways a throwback to the mercantile era of the sixteenth to the eighteenth centuries. Back then, currency consisted of precious metal—gold and silver bullion, or “specie.” Money was synonymous with wealth. Because nations were frequently at war, ...