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I don't know a lot about macroeconomics and this is a little off topic but isn't the honour system principle what nations work with and how trade deficits etc.
by nopassrecover 18y ago
I don't know a lot about macroeconomics and this is a little off topic but isn't the honour system principle what nations work with and how trade deficits etc. emerge?
- chime 18y agoYeah, Hawala is pretty much like distributed clearing houses. Most small businesses in India that I know use some form of Hawala (or Angadia).
- patio11 18y agoThis is essentially identical to what happens when I put cash in the ATM at 7-11 with instructions to wire with my local bank to a bank in Tokyo which wires it to a bank in Washington which wires it to Bank of America in St. Louis so that I can move it into my IRA. The yen doesn't physically get shipped to America, either.
- plinkplonk 18y ago"The yen doesn't physically get shipped to America, either." yeah I don't get the "without moving it" part either. With minor exceptions money doesn't physically move in the mainstream financial system either. There are many things that define hawala but "transfering money without moving it" isn't one.