"When goods are exchanged between countries, they must be paid for by commodities or gold. They cannot be paid for by the notes, certificates, and checks of the purchaser's country, since these are of value only in the country of issue"
About this Quote
Quigley is doing something unfashionable now: reminding readers that international trade is, at bottom, a settlement problem. His line strips away the comforting fiction that money is just money everywhere. A check drawn in Ohio is not a claim on Shanghai unless there is an institution willing to honor it. That distinction between domestic “promises” (notes, certificates, checks) and internationally acceptable “final payment” (commodities or gold) is the engine of the quote.
The intent is clarifying, but also disciplining. Quigley is pushing back against a populist or purely political view of trade that treats balance-of-payments constraints as optional. The subtext is a warning: nations can print claims on themselves all day long, but they cannot print foreign willingness to accept them. If you import more than you export, you eventually settle the difference with something outsiders actually want - real goods, hard assets, or reserve money.
Context matters. Quigley wrote in a century that watched the gold standard’s collapse, the rise of central banking, Bretton Woods, and then the slow drift toward dollar hegemony. His formulation reads “classical,” and in today’s system it’s both right and incomplete. Gold is no longer the mandatory bridge currency, but the core idea survives in the role of reserve assets and internationally trusted liabilities. The United States can pay with “paper” longer than most because its paper is, functionally, global collateral.
That’s why the quote works: it’s less about nostalgia for gold than about power. What counts as payment depends on who issues the promise, and who can refuse it.
The intent is clarifying, but also disciplining. Quigley is pushing back against a populist or purely political view of trade that treats balance-of-payments constraints as optional. The subtext is a warning: nations can print claims on themselves all day long, but they cannot print foreign willingness to accept them. If you import more than you export, you eventually settle the difference with something outsiders actually want - real goods, hard assets, or reserve money.
Context matters. Quigley wrote in a century that watched the gold standard’s collapse, the rise of central banking, Bretton Woods, and then the slow drift toward dollar hegemony. His formulation reads “classical,” and in today’s system it’s both right and incomplete. Gold is no longer the mandatory bridge currency, but the core idea survives in the role of reserve assets and internationally trusted liabilities. The United States can pay with “paper” longer than most because its paper is, functionally, global collateral.
That’s why the quote works: it’s less about nostalgia for gold than about power. What counts as payment depends on who issues the promise, and who can refuse it.
Quote Details
| Topic | Money |
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