The problem of the balance of trade and the lack of dollars for the payment of imports is a consequence of the Capitalist economic system being implemented upon us. The balance of trade, that is the balance of exports versus imports, is the difference in what we export and import in a monetary sense. So, for example, when we import from the US, we need to pay in dollars. To pay them dollars we need to export so that people pay us in dollars so that we can then pay for our imports in dollars. Because the world currency is dollars, the predominant currency in which the world trades is in dollars and, hence, most countries hold dollars. Therefore, our balance of payments status is given in terms of dollars. (more…)
