94 on the halauce of frade, afid exchanges. J^'^- l8» 

 bs done with perfect accuracy at all, it would be done 

 by means of the course of exchange between the two 

 countries. But though this be, without doubt, the 

 only pofsible mode of approximating to the solution of 

 this problem ; yet, unlefs the two nations, with regard 

 to which this attempt were, made, fhould be excluded 

 from all commercial intercourse with every other na- 

 tion, it cannot bs abjoluti'y accurate •, because, by means 

 of a circuitous exchange with other nations, the effect 

 of an extraordinary balance may be much moderated 

 on particular occasions. As many of your readers pro- 

 bably are not fully acquainted with the nature of ex- 

 changes } and, as I observe, you mean to give annual- 

 ly a list of the state of exchange between Britain and 

 the principal commercial nations in Europe, I fliall 

 hope that a fliort explanation of the nature of ex-- 

 clianges, and the manner in which these become an 

 index of the balance of trade, will prove acceptable to 

 them in general. This I fhall briefly give in the follow- 

 ing pages. 



By the term balance of trade is meant the propor- 

 tion in value, that the quantity of goods exported from 

 a country bears to that imported into it, from another 

 country. 



It is only in consequence of one article being con- 

 sidered as of equal value in all countries, that the idea 

 of an inequality in the balance of trade can exist ; for 

 without that there would be no standard by which the 

 value of the exports and imports of a nation could be 

 estimated. This article is universally gold and silver. 

 I call them one article, because they preserve nearly an 

 equal proportion in value to one another, under the 



