US would be better without global dollars

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This month, Chaos can violate the world’s financial markets in the world’s financial markets by the world’s financial markets, resulting in global reliability of US dollars. However, this should not be more serious about how the global role of the dollar affects the American economy.

Dominant “Safe” Currency Protecting the role of the dollar requires what economist Dani Rodrik characterizes A chased contradiction between global integration and national sovereignty. He notes that countries that choose more global integration must refuse to control the domestic economy, restrict the degree that the economies are open to trade and capital flows.

This creates this trade tension in a world of hyperglobalized. All countries are something to choose the same extent to their domestic economies in favor of more globalization. It is very different if some large economies choose to control their internal economies.

The reason for this, domestic and foreign economic imbalances should always be aligned in every country. When some nations restricted capital and trade streams, they can apply internal dimensions on trade partners who have less control over trade and capital accounts to protect their external imbalance. British economist Joan Robinson called them The “beggar-neighbor” trade policy said that the global trade conflict will result in an increase in the conflict.

For example, for example, a trade surplus, which cancel domestic demand to subsidize its production, can be reversed by market forces. However, by restricting trade and capital accounts, interfering with the currency, this country can prevent such an amendment. In this case, a trade surplus produced by its partners with less control over trade and capital accounts must be absorbed. What’s more, because the share of global production is more open than the share of global demand trade Partners should be reduced.

Therefore, it is not accidentally producing the share of GDP with deep, flexible and well-managed financial markets of the United States Global moderateUnlike economy, unlike the economy, which is a sustainable surplus, which is superior to the global average. The industrial policy aimed at reconstruction of more managed internal economies is also aimed at reconstruction of more open trading partners.

It is clear that Washington’s latest trade and capital policy was wrong – President Donald Trump announced a 90-day break in “mutual” tariffs in most countries, except for most countries in China. It is impossible to ease the door to increase these policies in solving the reasons for US economic conditions and to increase industrial subsidies in other, non-tariff forms.

However, to recognize the imperfections in this policy, it does not mean dismissal of the structural problems they want to apply. The fact remains in reality of global economic imagements. The challenge is not to act in order to correct this unbalion of the United States, but it is not that it should be both effective and continuously. The best solution is located in 1944 in a more sided approach to the formation of global economic governance along the lines offered by Keynnes, perhaps a new customs association.

However, if the world cannot reach such an agreement, the United States is right to act unilaterally in order to reverse the role of political distortions abroad. The most effective way can probably be monitored by the US capital account, which balances the surpluses of surplus by obtaining assets. It will first impact the US policy in terms of US policy under Trump, which is the first time to increase foreign direct investment, and will have little effect on direct investment. A less impressive road is a particularly rough way to solve the root causes of trade balances by bilateral tariffs, through the US trading account.

If the domination of the dollars in the global trade and finance had long been a net benefit for the American economy, but this hypothesis is becoming more difficult. Although this Wall Street and global portable capital owners benefit, these benefits come from these benefits for American manufacturers and farmers.

In a world in which some countries do not actively manage the foreign imbalance and others actively, the initial secure currency role in the United States made the United States, American global economic distortions. Applications for these unbalion require the main revaluation of the rules that regulate global trade and capital flows.