Politicians and pundits have a blind spot when it comes to international economic transactions. They ignore a portion of trade! In particular, they ignore trade in claims on future income—that is, stocks and bonds.
Politicians and pundits have a blind spot when it comes to international economic transactions. They ignore a portion of trade! In particular, they ignore trade in claims on future income—that is, stocks and bonds.
When productions falls and people cease to work, an influx in new money does nothing to increase the standard of living. This was true during past pandemics, and it's true today.
If the Chinese sell us stuff and then "hoard" the money we pay them, that increases the value of the dollars we continue to hold here in the US, while also leaving us with more stuff to sell elsewhere.
