Let's talk about: Global World Currency

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Zaptruder

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Neogaf, I'm uninformed.

I'd think it'd be neat to have a global world currency, but I'm not versed sufficiently in international economics and monetary policy to say why this would be a good or bad thing.

But my spin on the suggestion of a world currency would be to have it introduced as an intermediary for exchange - that is, currencies are no longer traded directly, but traded into the world currency, then exchanged out of it. It seems like this (dual currency system) would be a good way to get around nationalist pride and currency loyalty.

Also, it seems as though it would make sense given the degree of entanglement that already exists in international economics... that is only set to grow in the coming decades.

What say you gaf? Good idea? Bad idea? Inevitable? Never going to happen?
 
AiTM said:
Look at the Euro and tell me you want a global currency.
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First post nails it.

Look at all the trouble the differences in economic stability between Greece and say Germany has caused and think for a while what would happen if the US and Bangladesh had the same currency...
 
AiTM said:
Look at the Euro and tell me you want a global currency.
Click to expand...

I dunno. Like I said, I'm pretty uninformed... so exactly what are the pros and cons of the Euro currency itself? Is it something that could survive without the EU? Would it be the same thing as having a world currency?

Is this suggestion as specious as suggesting that standalone currencies won't work - just look at the Mark and the Zimbawean dollar?
 
Zaptruder said:
Why is this a concern? I don't mean this rhetorically... I'm genuinely curious.
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The dollar acts a bit as a "world currency" in that it is the "reserve currency". Since commodities are traded in dollars, we receive the benefit of cheaper goods. I'd say it is important question as to who is printing this proposed currency as they will have some measure of control of said currency. It is called "fiat" currency for a reason.
 
In economics, an optimum currency area (OCA), also known as an optimal currency region (OCR), is a geographical region in which it would maximize economic efficiency to have the entire region share a single currency. It describes the optimal characteristics for the merger of currencies or the creation of a new currency. The theory is used often to argue whether or not a certain region is ready to become a monetary union, one of the final stages in economic integration.
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- Via Wikipedia.


Currencies being shared by many nations come with advantages and disadvantages. Obviously it's more convenient, and it removes things like "exchange rate losses" (those on the gaming side may remember that Nintendo got hammered by them quite hard this year). On the other hand, by having an international central bank controlling the currency, a country loses the ability to print money at will.

The admission of countries into the Euro that really shouldn't have been eligible (not naming any names) provides a good illustration of the sort of consequences you will get if you have a global currency that lets everybody participate. On the other hand, if you're keeping half the world out because they are not economically 'compatible', then it's not going to be a one-world currency.
 
Zaptruder said:
I dunno. Like I said, I'm pretty uninformed... so exactly what are the pros and cons of the Euro currency itself? Is it something that could survive without the EU? Would it be the same thing as having a world currency?

Is this suggestion as specious as suggesting that standalone currencies won't work - just look at the Mark and the Zimbawean dollar?
Click to expand...

different economies have different strengths and weaknesses. Having the Greeks and the Germans with the same currency is bad for both.

for countries with weaker economies it is advantageous to have a currency that is of lesser value than a stronger economy. It makes any exports from that country extremely competitive and imports much less competitive. this allows them to build an industrial/mining/farm base and earn foreign currency. that's why the US are always pressuring the chinese to revalue the Yuan. it would make chinese imports less attractive and allow US companies to compete when manufacturing stuff. the chinese keep the Yuan down because the inflow is driving their growth

If every country had the one currency, there'd be no opportunity for the weaker economies to improve. stuff would just be made in the big economies, closest to the market. the current north south divide would continue ad infinitum.

the greeks are a fucking basket case and need a weaker currency so that they can compete. The germans do not need a weaker currency.

The only way to have one currency is to have one government, with one economic policy, and one economy. mmmm not anytime soon.
 
You consolidate too much power with a global currency. Not a good idea with humanity's current collective intellectual level.
 
That and a global world currency wouldn't work unless you normalise tax and other duties worldwide. And then you have to bring discrepancies of cost of living into account.
 
I dunno about that. I'm not that well versed in currencies and world economics but some countries have stuff a lot cheaper than other countries (like in the Philippines, a regular burger costs around half a dollar to one). Food over $5 can be considered expensive. If we are to unify the world currencies, there would definitely be problems.
 
Your Excellency said:
Only a matter of time, though.
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I think it's more likely we'll end up going back to barter.

Most of the first world simply cannot stop spending more money than it produces. Hell, in the US, we can't even cut the rate of increase without people crying.

There's a saying - if something can't go on forever, it won't. The prevailing economic theory of most governments is that you can spend your way out of debt (see stimulus, bailouts, etc) but it's simply not working...
 
Zaptruder said:
Neogaf, I'm uninformed.

I'd think it'd be neat to have a global world currency, but I'm not versed sufficiently in international economics and monetary policy to say why this would be a good or bad thing.

But my spin on the suggestion of a world currency would be to have it introduced as an intermediary for exchange - that is, currencies are no longer traded directly, but traded into the world currency, then exchanged out of it. It seems like this (dual currency system) would be a good way to get around nationalist pride and currency loyalty.

Also, it seems as though it would make sense given the degree of entanglement that already exists in international economics... that is only set to grow in the coming decades.

What say you gaf? Good idea? Bad idea? Inevitable? Never going to happen?
Click to expand...

http://en.wikipedia.org/wiki/Bancor

It would have happened, except America was on top of the world after WW2 and we weren't going to take suggestions from some limp-wristed Brit econ professor on how to run the world we owned.

The Bretton Woods system was also basically the same as what you proposed, except the dollar was the international currency as well as the domestic currency of the US. It worked until successive US presidents decided we didn't need to maintain it.

So then we got Bretton Woods II, where everyone treats the dollar like an international currecy and the US (mainly Alan Greenspan) thinks world currency markets will run themselves efficiently. Fuck we are so dumb. Eventually someone has to realize that international currency flows need to be managed, and there's really nothing stopping the US from doing so unilaterally except all the orgasms Congressmen get out of the term "efficient markets".
 
Well some conspirationists say that the Americans want to create the "Amero", there must be something up on youtube or something, you might want to check it out. Or not.
 
It would be great for the future, but it would suck during out own life times. If tossing out bs numbers, say it would take at least 50 to 100 years before the growing pains of a Global Currency to finish.
 
Is there labour market flexibility throughout the world? No
Is there a fiscal transfer mechanism throughout the world? No
Is there wage flexibility in all world economies? No
Is there price flexibility in all world economies? No
Is the convergence in inflation, gdp and employment between all world economies? No

When you adopt a common currency you lose the ability as an economy to devalue your currency if your economy is weak and revalue your currency if your economy is strong. As a result all of the above criteria must be satisfied in order mitigate the effects of an unknown, unforeseeable economic shock. Lets say that Argentina went into a recession and Vietnam went through a boom. Is it likely that all unemployed people in Argentina will move to Vietnam to seek work? Of course not. Is it likely that surplus tax receipts in Vietnam will be transferred to Argentina to stimulate the economy? Nope

All the above are SIGNIFICANT economic hurdles but they pale in comparison to the political hurdles.
 
LQX said:
A world where everything is free...heaven?
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If resources were properly managed and distributed on a worldwide scale instead of independent tiny groups all trying to grab what they can from corporations and the like, yeah, it could work.
 
Sentry said:
If resources were properly managed and distributed on a worldwide scale instead of independent tiny groups all trying to grab what they can from corporations and the like, yeah, it could work.
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That's a world I would love to live in. One free mansion and a Ferrari please, also 100 chicken nuggets.
 
Sentry said:
The only world currency that will work is no currency.
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I'm with you. This whole work for money thing is BS. The rich get super rich and the poor get shat on. Everything should be free and voluntary. Whoever first invented currency needs a swift kick to the balls.
 
Halycon said:
Who would print it?
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bison-dollar.jpg
 
Manics said:
I'm with you. This whole work for money thing is BS. The rich get super rich and the poor get shat on. Everything should be free and voluntary. Whoever first invented currency needs a swift kick to the balls.
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Basically, technologically we have reached a point where so much of the work in our system can be easily automated.

Currency had it's time and benefits, and it was a vital stepping stone to general world abundance, but we need to know when it exists for the sake of tradition versus actual systemic value.
 
Sentry said:
If resources were properly managed and distributed on a worldwide scale instead of independent tiny groups all trying to grab what they can from corporations and the like, yeah, it could work.
Click to expand...

And if fairies were real we could live in a magical wonderland of rainbow snowballs and bubblegum bees.

Humanity will self-destruct before we ever reach the point you are describing.
 
Manics said:
I'm with you. This whole work for money thing is BS. The rich get super rich and the poor get shat on. Everything should be free and voluntary. Whoever first invented currency needs a swift kick to the balls.
Click to expand...

The day that happens I give society less than 10 years before everyone looks like the people from Wall-E. Obesity rates will hit 99% life expectancy will drop like a rock. And demand for more extreme reality shows will sky-rocket.

If I lived in a world were all of sudden everything is free and nothing is expected from me, I would literately lose the will to get out of bed.

When you take away the necessity to do something people will choose to do nothing.
 
Zaptruder said:
But my spin on the suggestion of a world currency would be to have it introduced as an intermediary for exchange - that is, currencies are no longer traded directly, but traded into the world currency, then exchanged out of it. It seems like this (dual currency system) would be a good way to get around nationalist pride and currency loyalty.
Click to expand...

This idea is called IMF special drawing rights which were created for the defunct Bretton Woods system. But I don't think a system like that would be used by consumers meaning the propaganda effect of having a "world currency" would be lessened since it would be used transparently behind the scenes.
 
LQX said:
That's a world I would love to live in. One free mansion and a Ferrari please, also 100 chicken nuggets.
Click to expand...

No Ferraris, per say, but they would no longer rely on planned obsolescence to make you buy a new car every 5 to 6 years, so the quality of the cars you could get would be much higher. Chicken nuggets? Yuck.

Really though, it's our desire to place ourselves on a pedestal above our fellow mankind that requires the money system to motivate us to do work. This seems hard wired in the competitive nature of humans and likely will never change. I believe we'll wipe each other out violently within 100 to 200 years and we'll probably deserve it.
 
captmorgan said:
The day that happens I give society less than 10 years before everyone looks like the people from Wall-E. Obesity rates will hit 99% life expectancy will drop like a rock. And demand for more extreme reality shows will sky-rocket.

If I lived in a world were all of sudden everything is free and nothing is expected from me, I would literately lose the will to get out of bed.

When you take away the necessity to do something people will choose to do nothing.
Click to expand...
Then I might as well put a bullet in your head right now. Sorry, but you're a fucking fool. Do you have no desires? No plans, no joy or love for anything in life other than consumption?

If this was true, you would not be on this forum choosing to express your thoughts; you want to be heard, inherently, whether you know it or not.

Obesity is not caused by the availability of food alone, if this were true the rest of the modern world would be following the same trends as the U.S.
 
BertramCooper said:
A single global currency wouldn't work without a single global government.

And I'm pretty sure we don't want the latter.
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^ this


And to get a single global government, we're likely going to need all (or most) countries to have: stable, secular democracies and current poorer nations to economically grow, until the standards of living in such countries are much closer to already and future developed nations. The ball will really start rolling once both Russia and China have such democratic, non-authoritarian governments.

But the whole one world government and global currency system will not be possible, until I think later in this century.
 
BertramCooper said:
A single global currency wouldn't work without a single global government.

And I'm pretty sure we don't want the latter.
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What, because having many different governments is working out so well now, and historically?

Saying you don't want a single global government is like saying you want america to be split up into 5 countries because of the terror that having a single country that powerful could bring.
 
Your Excellency said:
What, because having many different governments is working out so well now, and historically?

Saying you don't want a single global government is like saying you want america to be split up into 5 countries because of the terror that having a single country that powerful could bring.
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By what means would you like to unite the roughly 200 sovereign nations and seven billion people under a single government?
 
captmorgan said:
The day that happens I give society less than 10 years before everyone looks like the people from Wall-E. Obesity rates will hit 99% life expectancy will drop like a rock. And demand for more extreme reality shows will sky-rocket.

If I lived in a world were all of sudden everything is free and nothing is expected from me, I would literately lose the will to get out of bed.

When you take away the necessity to do something people will choose to do nothing.
Click to expand...
My wife and I are about to commit the next 2 years to life in a voluntary community. It's a therapeutic community for adults with special needs; therefore it has a specific purpose, and is not simply a test bed or attempt to 'go backwards' to a model of community living. It is also heavily subsidised from outside by both private donations and the public sector, and therefore a long way from being self-sufficient. However I have never experienced such a sense of purpose as I have in being there, and I believe it can instruct vitally important lessons on one's relations with other people, society at large, and the environment. Everyone works to the level they are capable and in activities that fulfil them. Meat, milk, bread, cheese, eggs and veg are all produced, biodynamically, by the community, so the diet is also several steps above the average. And people get pride from what they're doing for the community.

In many senses I don't think the people there have a deep enough sense of the value of what they've cottoned onto, and perhaps fail to take the lessons about the importance of relationships and apply them upwards, towards the community's relationship with the 'real' world. A self-satisfied, insulated 'them and us' mentality arises, whereas actually I believe the community should be actively trying to preach its values out into X-Factor society, and at the same time reduce its dependence on X-Factor money.

I would love to see this movement grow, and of course there are many strains shooting up all over the place. It's important not to see it as a step backwards towards a golden age, because that never existed. This shouldn't be about un-making society's terrible technocratic mistakes, because I don't believe in mistakes. It's important to grow forwards and believe in something exciting and alive coming together, rather than in the resurrection of something both fictitious and dead.

But the fact remains that living sustainably, self-sufficiently, biodynamically, and close to the land and other people is massively unattractive to (??number?) many people ... The people with their feet on the pedals, at least. There's no right and wrong, and if there was I certainly wouldn't know it. Um ... So yeah, to sum up, I'm happy with the choices I'm making and am looking forward to the future.
 
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