Efficient capital markets

With only a few caveats, I believe in globalization and free market economics. Production and all work should be done in the most efficient way possible, factoring in long term environmental damage to production costs. I just read an interesting guest editorial in the Asia Times (taken from the author's informative and useful blog) that makes a good point about efficiency in international markets: that a global economy driven by tough efficiency will naturally evolve away from using the US dollar for oil and other commodity trading when using the dollar adds cost to all involved (except for the US).

Unfortunately, I think that my country (the US) will continue to take strident and largely ineffective steps to try to prop up the dollar as the primary currency for buying and selling commodities. I believe that it is better for us to concentrate on efficiency through an educated work force and investments in infrastructure than to try to sustain a very good deal that we have had since the early 1970s (i.e., getting off the gold standard, float the dollar, and deals to make the dollar the currency for buying and selling oil). This was a great deal, we should appreciate our good fortune, but realize that this good deal will not last forever.

Even with the current tragedy in Iraq, I am as hopeful for the future of the world as I have been in a long time. I believe that efficient world markets with tightly intertwined economies will bind people together and hopefully lead to more peace and world wide prosperity.

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