- Bob Murphy's argument regarding America's current trade deficits is that they are misunderstood. These trade deficits are not all that bad. When America left the gold standard under president Nixon this caused a lot of problems. But, when this happened, the US dollar essentially became the standard for many other nations currencies. This is how America is able to have trade deficits lots of the years and our GDP will still be increasing.
- Bob Murphy used scripture to back up his argument by using a verse from Deuteronomy. God allows nations to prosper and flourish and other nations to not. Nations trade with each other. Also, in ancient Israel concerning loans, Jews could not charge interest against each other, but Jews could charge interest against gentiles. Nations can have their own economic laws and other nations can have their own economic laws as well.
You did a good job explaining how the gold standard and the value of the U.S. dollar can affect trade deficits and GDP.
I think this well sums up that the trade deficit is not a negative thing but rather a new way to keep a standard currency.