Global Currency - PART 4 Isokratia Global
Money is not an easy concept, although I do believe we humans, have come to know a few things about it by now. The three major factions we are told of money is; itself as a unit of account, a store of value and a medium of change. As such, money represents an exchange value, not an intrinsic value. The value of money depends on the value of the goods and services, for which it can be exchanged.
Compared with when we use money as a tradable commodity, selling one currency to obtain another, then we see that there is no exchange value. Many currencies are not acceptable around the world. Though these currencies have an exchange value in their own national boundaries, they have no exchange value outside their national boundaries into the international market.
For instance, we take Iraqi currency into Europe or any other country, nobody wants it. It has no exchange value and as such no value, as it is worthless. Offer an American or a German, one billion Iraqi money notes and ask them to pay only a single US dollar and they will refuse it. The same would happen anywhere in the world because the Iraqi currency has no exchange value, no face value, outside the Iraqi borders. The same applies to many currencies.
The exchange value of the rest of the currencies around the world even the strong like the US dollar, sterling, Euro, German Mark (oups is now gone) and Japanese Yen, they only have an exchange value, as long as people are willing and can use them for their trade exchanges. As soon as people stop, or shy away from using a currency, it has no exchange value. Automatically such a currency, becomes worthless since it stops having an exchange value.
Therefore, it can be argued that, currency in itself is not a tradable commodity, since it has no trade value. That’s is why is wrong to allow it to be a tradable commodity, or service for that matter. Yet under the present economic activity and trading climate, currency trading not only sounds logical but seems to fit in the economic equation. I believe that this is a total waste and that sooner or later we have to address it.
In some ways, the 19th century version of the global capitalist system was more stable than the current one. The reason for this is because the 19th century financial market system was based on a single currency. Gold. Today in the centre there are three old major currencies ( US dollar, British Pound, Japanese yen) and the newly launched Euro, crashing against each other like continental plates. ( The Euro has since been launched and is fast becoming a strong candidate in the currency market). Then a handful such as the French Franc and D. Mark are fighting for the highest position in the currency league ( no longer the case as it now is 2003?). The rest struggle to keep their currency exchange value; but even so, they don’t worth the paper they are printed in the real currency world. None of the national currencies are based on a face value of gold. Even worse currency has become a manipulate-able tool for governments used for indirect control of economic aims through such actions as devaluations and interest rates manipulations.
Last worked on 2nd August 2002
4th January 2003 02.22
Back to work 3rd August 2002 21.53
17th May 2004 00.37am after about an hours work.
Back TO WORK 12th September 2004 10.24 p.m.