Allowing Foreign Coins to enter at higher rates relative to our Standard will not Increase our TreasureJanuary 24, 2020
The discreet Merchant [trade financer] carefully learns the value of the foreign money that he receives according to their weight and fineness compared to ours. This will help him know his profits or losses.
We sell our valuable goods to diverse places that have nothing useful to sell to us. That’s why we require payment in ready money. We then use this money to buy the useful goods of other Countries. It can even be melted down to be minted into our coin. However, this last method will increase our Treasure very little because=
Other countries will do the same with their money to counteract ours
The increase in our circulating money would make it lose value relative to foreign coins
If our currency is slightly more valuable than foreign coins, it will not make much of a difference because the merchant will use whatever money is good for importation
On the other hand, if we permit a great advantage to the foreign coins, then our sterling mony would go overseas. Therefore, monetary policy is fruitless. The important thing is the balance of trade through fiscal and trade policy.