Foreign Exchange: The Financing Mechanism of International Commerce

Foreign Exchange: The Financing Mechanism of International Commerce

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Foreign Exchange: The Financing Mechanism of International Commerce

Foreign Exchange: The Financing Mechanism of International Commerce

Read FREE!

Excerpt

There appears to be a fairly common impression that there is something peculiarly mysterious or recondite about the subject of foreign exchange. Professor Furniss's lucid and wellproportioned account should do much to correct that impression. The truth is that the operation of the foreign exchanges is in many respects simpler and less obscure than that of other parts of our monetary mechanism. That the subject has this undeserved reputation for obscurity must be attributed, I suppose, to the manner in which the books have dealt with it.

Books on foreign exchange fall for the most part into two classes. First, there are the books that are weighted down with purely technical details respecting such matters as monetary standards, commercial laws, stamp taxes, the arithmetic of exchange rates, and the like -- excellent desk books, doubtless (if only they could be kept up to date), for dealers in exchange. Second, there are the more philosophical discussions, dealing with the general principles of foreign exchange. Too many of the books of this second type make the subject unduly obscure by making it unduly abstract and unreal or by entangling it with the intricate problems of the general theory of international trade.

Professor Furniss has chosen a middle course. On the one hand he is careful to avoid petty technical detail. On the other hand he is equally careful to keep close to concrete realities. For these reasons, I believe, his book will commend itself to two different classes of students. Those who, in schools of commerce or elsewhere, are preparing themselves for business careers will find in it an orderly account of the principal operations of the foreign exchange market. He leaves to one side such minor matters of detail as can be more profitably acquired through actual experience in the work of the foreign exchange department of a bank. Those whose inter-

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