This only works at a minuscule scale, where people could actually get to meet face-to-face. On a global network, Alice can still create an attack against Charlie. She just needs to get more intermediaries. Even if the intermediaries thought "surely Alice won't put the relationship at risk over a small amount", no one in their right mind would be doing large scale,
automated transactions based on "friend-of-a-friend" connections.
Another thing, if you want to make transactions like the one you described, you don't need to pass IOUs around, you just pass money. Alice gives the IOU to Bob, Bob gives her money and then she can buy from Charlie, David, Eve or anyone else.
