You are here

Ralph Benko: Trade deficits are the price of issuing the world reserve currency

Section: Daily Dispatches

8:30p ET Sunday, March 11, 2018

Dear Friend of GATA and Gold:

Financial writer and gold standard advocate Ralph Benko this week joined those explaining that huge trade deficits are inevitable for any country that enjoys the "exorbitant privilege" of issuing the world reserve currency.

Benko writes:

"World War II -- in which my heroic father Max Benko fought along with millions of others -- left America relatively unscathed. After V-Day our allies and our vanquished enemies' economies lay in shambles. We could (and did) give ourselves a treat while extending an invisible helping hand -- one much greater than the Marshall Plan -- to war-torn Europe and Japan.

... Dispatch continues below ...


Fisher Precious Metals is preparing and equipping
clients for the upcoming 'Everything Bubble'

Fisher Precious Metals, North America's top-rated bullion dealer, known for personal service and great pricing, has been helping Americans and Canadians protect their wealth with precious metals for more than a decade. Enjoying a five-star client rating across the internet with no complaints at the Better Business Bureau, the team at Fisher Precious Metals works hard to serve you.

We have helped thousands of clients in buying and selling bullion, arranging segregated and offshore storage, establishing precious metals IRAs, and obtaining certified precious metals appraisals. We provide security to our clients with our Bullion Authenticity Guarantee. We recommend that you read our article "How to Avoid Bullion Counterfeits":

As a family-owned business, we strive to help you assess your wealth-protection goals and overall investment objectives. From the new precious metals buyer to the seasoned bullion investor, we are here to help you with a no-pressure, confidential consultation. Rest assured that everyone in our firm owns physical precious metals and no one is compensated via commission -- period.

Fisher Precious Metals is your full-service precious metals investment partner for life. Please call us at 1-800-390-8576 or visit us here:

"How? After World War II, the world, led by America, entered into an arrangement called Bretton Woods. This made the U.S. dollar the world's 'reserve currency.'

"In practice, Bretton Woods meant that Americans could consume more than we produce -- an exorbitant privilege -- by exporting dollars rather than goods. How, exactly, did that work? ....

"As American economist Barry Eichengreen summarized: 'It costs only a few cents for the Bureau of Engraving and Printing to produce a hundred-dollar bill, but other countries had to pony up $100 of actual goods in order to obtain one.'

"That privilege, which made great sense during the period immediately after World War II, became a curse.

"How did our 'exorbitant privilege' transform into a curse? By inequitably prejudicing our manufacturers.

"The key element -- the reserve currency status of the dollar -- of the Bretton Woods 'Calvinball' monetary treaty remains in place. Time to end that ... as Donald Trump seems to almost preternaturally intuit."

Benko's commentary is headlined "Exit Gary Cohn. Enter Lewis Lehrman, Steve Forbes, or Larry Kudlow?" and it's posted at Forbes here:

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee

* * *

Join GATA here:

Mining Investment Asia
Monday-Wednesday, March 26-28, 2018
Marina Bay Sands, Singapore

Mines and Money Asia
Tuesday-Friday, April 3-6, 2017
Hong Kong Convention and Exhibition Centre

* * *

Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

To contribute to GATA, please visit: