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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Hawkmoon who wrote (111959)	5/24/2010 11:47:58 AM
From: maceng2	1 Recommendation Read Replies (1) \| Respond to of 116555

Interesting. All considerations with much value and/or truth. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ I'm going to argue a different tack though. World trade is good. Less world trade and we sink into parts that are less then the sum. We know this from both experience and theory. The less trade we have, the less overall wealth we have overall as individuals. We need to transmit wealth from one part of the world to another efficiently to facilitate trade. The best way to efficiently facilitate trade is to have a single world currency. Now, hold your horses if you think my idea is just both that simple and confining. There is some subtlety I suggest. Local currencies can be used whenever countries, counties, towns or even streets want them. Message 26543349 The important concept is they are tied to a single super unit of currency. It doesn't HAVE to be gold, but it needs to be better the the baloney we have today. MUCH MUCH better, so that any citizen of the world can trust the world currency unit. I believe the system put together at the first Bretton Woods agreement was based on gold. It needs a proper update that is not just based on the preference of just one country. Non fiat based is an obvious choice. BRETTON WOODS 1 (not the later derivations) en.wikipedia.org What emerged was the "pegged rate" currency regime. Members were required to establish a parity of their national currencies in terms of gold (a "peg") and to maintain exchange rates within plus or minus 1% of parity (a "band") by intervening in their foreign exchange markets (that is, buying or selling foreign money). In pictures this this the worlds currency system we have today. Etching of Overhead Telephone and Telegraph Wires in Broadway, 1890. "Wires snapped on a regular basis as a result of over tension, wind, or ice weighing them down. The electrical wires carried a significant charge, but the other wires carried electricity as well. As wires snapped and lashed across streets, smashing against buildings, thrashing about, spraying sparks in all directions, blocks were rendered impassable until power to the downed lines could be cut." In currency terms, we all these problems are happening. If you run a business you already will have headaches because of variations in currencies. What is needed... Whats nice about my proposal (it's not really that new an idea) it that there are very few rules, people and countries can do more or less what they want, and free markets do the rest.