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The exporter will acquire dollars from a currency trader who will sell dollars to them in exchange for pesos at the current market rate plus some premium. The c

The exporter will acquire dollars from a currency trader who will sell dollars to them in exchange for pesos at the current market rate plus some premium. The currency trader will then find a buyer who wants pesos in exchange for some other currency. It’s all market based today, after the fall of Bretton Woods, which came after gold exchange as the basis of international payments for trade. https://en.wikipedia.org/wiki/Gold_standard https://en.wikipedia.org/wiki/Gold_standard https://en.wikipedia.org/wiki/Bretton_Woods_system https://en.wikipedia.org/wiki/Bretton_Woods_system https://en.wikipedia.org/wiki/Jamaica_Accords https://en.wikipedia.org/wiki/Jamaica_Accords It might be that what you’re talking about is the balance of trade, which is related to, but not the same as currency exchange. But if that’s what you’re talking about, those are the words you should be using.

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fsckboy 2y ago
>It might be that what you’re talking about is the balance of trade, which is related to, but not the same as currency exchange. But if that’s what you’re talking about, those are the words you should be using. it's not that I am talking about balance of trade, it's that the orignal question was about balance of trade: owebmaster 3 days ago on: Mercantilism https://news.ycombinator.com/item?id=43589882 https://news.ycombinator.com/item?id=43589882 >and what does Milton Friedman say about a country having enough money to import without export? he didn't say "a person", he said "a country", that's balance of trade. so I explained why, by looking at currency exchange, we see that a country cannot engage in perpetual importing without export you say: >The exporter will acquire dollars from a currency trader who will sell dollars to them in exchange for pesos at the current market rate plus some premium. if a country contains no exporters, only importers, the market for dollars or pesos will continue to tilt more and more in one direction. You don't need to model a world market of currency trade to see this, imagine a market with no currency traders (a service industry) but instead a market where you have to do-it-yourself exchange of currency. you will see the same impossible situation of currency flow all in one direction that it essentially consists of printing money till it's worthless we don't even need currency at all, I could base my argument on barter, but he said "a country having enough money" and money brings currency into the question.

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fsckboy 2y ago

>It might be that what you’re talking about is the balance of trade, which is related to, but not the same as currency exchange. But if that’s what you’re talking about, those are the words you should be using. it's not that I am talking about balance of trade, it's that the orignal question was about balance of trade: owebmaster 3 days ago on: Mercantilism https://news.ycombinator.com/item?id=43589882 https://news.ycombinator.com/item?id=43589882 >and what does Milton Friedman say about a country having enough money to import without export? he didn't say "a person", he said "a country", that's balance of trade. so I explained why, by looking at currency exchange, we see that a country cannot engage in perpetual importing without export you say: >The exporter will acquire dollars from a currency trader who will sell dollars to them in exchange for pesos at the current market rate plus some premium. if a country contains no exporters, only importers, the market for dollars or pesos will continue to tilt more and more in one direction. You don't need to model a world market of currency trade to see this, imagine a market with no currency traders (a service industry) but instead a market where you have to do-it-yourself exchange of currency. you will see the same impossible situation of currency flow all in one direction that it essentially consists of printing money till it's worthless we don't even need currency at all, I could base my argument on barter, but he said "a country having enough money" and money brings currency into the question.