chapter  V
28 Pages

Financial Policy and the Balance of Payment

First and foremost there is the problem of making the goods and services available for sale to the foreigner. This is above all a question of the control of monetary purchasing power on the domestic market by the means discussed in Chapter II. A reduction of the domestic demand for goods and services for all domestic purposes (personal consumption, government consumption, and public and private capital development) directly reduces the demand for imports1 and by reducing the demand for home-produced goods and services it will also cause more supplies to be available for export, A sufficiently stringent internal policy of "disinflation" will thus ensure that the restoration of our balance of payments is not impeded by an insufficiency of supply of goods for export.