It's more accurate to say that the results of labor are delivered. That might be a product or service.
And these things can be exchanged for money, which can then be given to other people in exchange for their labor.
Yes, technically you are borrowing money, but it has no effect until its used to purchase the results of labor, which is what you actually want to borrow. Your mortgage is actually borrowing the results of all of the labor required to build it, including the labor to make the sheet rock.
If there's a disaster in Haiti and the US lends Haiti a billion dollars, that money will be used to buy things. Or pay people to do things, who will then go and buy things with the money.
Demand then rises for these things and more of them must be imported. Even if they come from a third country, that additional demand causes imports to increase there. Ultimately, that additional demand affects exports from the US.
And, if Haiti ever pays the money back, Haiti will be the one experiencing an increase in its exports.
The beauty is that we are not locked into buying just the products and services the lender offers. We can get anybody's.
To learn more about this, you could check out Austrian economics and the division of labor.
And these things can be exchanged for money, which can then be given to other people in exchange for their labor.
Yes, technically you are borrowing money, but it has no effect until its used to purchase the results of labor, which is what you actually want to borrow. Your mortgage is actually borrowing the results of all of the labor required to build it, including the labor to make the sheet rock.
If there's a disaster in Haiti and the US lends Haiti a billion dollars, that money will be used to buy things. Or pay people to do things, who will then go and buy things with the money.
Demand then rises for these things and more of them must be imported. Even if they come from a third country, that additional demand causes imports to increase there. Ultimately, that additional demand affects exports from the US.
And, if Haiti ever pays the money back, Haiti will be the one experiencing an increase in its exports.
The beauty is that we are not locked into buying just the products and services the lender offers. We can get anybody's.
To learn more about this, you could check out Austrian economics and the division of labor.