On the hydraulics of globalization

which take up more explicitly mine from 2009, and can be summed up in one: don't sell the bear's skin before killing it. Those who pontificate on the end of the dollar should ask themselves how desired (and desirable) this end is by the (theoretical) beneficiaries. Anyone who counts on US demand (deficit) to support their growth, i.e. anyone who entrusts the fate of their economy to their foreign surplus, cannot oppose the circulation of dollars in the global economy, due to the contradiction that does not allow it. The injection of dollars into the circuit of global liquidity is in fact the necessary counterpart of the purchase by the USA of goods produced by the global economy. The fact that if I buy you goods I give you money is, i.e. should be, a fact acquired from the end of the mythological "barter economy" (which as we know never really existed in the way university textbooks tell it), and therefore is as true today as it was in 2009 or 1009 (including 1009 BC).

These considerations concern us, because we will be dealing with the theme of the "dedollarization" of the global economy in our next annual conference (to avoid painful misunderstandings, I remind you of the dates: 25 and 26 November 2023), and because they elegantly reaffirm the considerations in the global context about the current stage that we have done so many times (find them here ).

Anyone who has difficulty understanding its meaning will find help in the many posts on sectoral balances. Perhaps one of the most systematic, and also the most current, is that of 2015 on France . We'll come back to the subject later, but meanwhile I'm writing to Pettis to congratulate him.

(… and now I'll leave you: the left goes to the Aventine, and I'm going to Siena …)