Ep. 276 Even Milton Friedman Slipped in His Defense of Trade Deficits
Bob Murphy Show
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How to Deal With a Current Account Deficit
If there were no financial assets, then it would just be the trade deficit or surplus. But even at the start of a given period, there could be assets that we already own from previous investments. So what if Americans own assets located in other countries, or that generate foreign income for us? And hence, you'd rather have more imports than exports. That's what a trade deficit is by definition.
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