The Myth of Free Trade Without Free Currency MarketsFree trade implies no tariffs are added to a country’s products as it enters another country for sale. It has been the United States policy since World War II. But no tariffs implies that the currency valuations of each country are in sync with each other. A simple mathematical exercise can show you how just the currency valuation can dramatically effect a product’s price. Read L. Ronald Scheman’s article below for a better understanding of China and the Middle East’s current economic advantage over the United States. The Myth of Free Trade Without Free Currency MarketsBy L. Ronald Scheman The commitment to free trade that has guided U.S. policy since World War II has produced enormous benefits to a growing global population. It has helped to increase productivity, lower prices and bring millions of people out of poverty. However a substantial question remains as to whether trade is free if the medium of trade, the currencies that set prices, are not. The complex issues of free international trade have one truth at their core: The value of products traded across borders is determined by the currency in which the trade takes place.
Go to Ethical Standard articles from The Myth of Free Trade Without Free Currency Markets |
