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The problem is that flows like GDP count the "same dollar" multiple times. When the dollar moves from one place to another, it's counted. (To preempt the pedant
by jdmichal 9y ago
The problem is that flows like GDP count the "same dollar" multiple times. When the dollar moves from one place to another, it's counted. (To preempt the pedants: Yes, there are exceptions as to exactly where these counters are. Not every movement is counted.)
That's drastically different from having to have a large pile of "different dollars" to make a large purchase like this.
- jmh530 9y agoGDP is a measure of value-added. That's why they net out things like net trade.