posted on Mar, 12 2009 @ 04:05 PM
It's going to take a lot more of an economic downturn for this to be implemented. We're talking major currencies failing (Euro, pound, US Dollar).
This would have to be followed by a global bank holiday (couple weeks likely) while the system is retooled and the global regulations are implemented.
Then each currency would be exchanged to the new one at a rate that'd likely make many of us poor to start with.
But you are right, this is the next in a long line of steps to a world currency.
As for the detractor that made fun of all the movements to unify currency...here's why this is important: one currency means that borders will have
be broken down along with social barriers (National identity). This has been seen in the states. Those 13 colonies first referred to themselves as
derivatives of that state (Georgian for example) when they each had their own identity and their own currency. Now when they were all put under the
dollar and the first major war of the new country was experienced (War of 1812) this mindset of each state being its own power was set aside.
Georgians became Americans when they talked abroad.
Jump back to the present and a single currency in the world would make it impossible to have competition for loans on the international market. Since
this global currency would have to be housed at a single international bank (IMF probably). This bank would have control over the entire money supply
of the world, and no competition would drive interest rates down in good times, or recession worries to drive them up. Whatever the IMF wanted to do,
it would do. Essentially this would hand over the reigns of the global economy to a single oligarchy which could impose its will on fiscal policy by
threatening with monetary policy.
IMF: "United States, you are making too much ruckus about abortion, we're foreclosing on this loan and that one. Pay up."
US: "Um....sorry?" *pulls out empty pockets*
IMF: "Ok, I'm sure we can find something to make a deal with. How about you get rid of that law and we'll forget about this for now."
US: "Consider it done!"
I know, very simplistic, but the fact is that a global central bank with the powers of monetary policy would have every country by the belt buckle
(more painful really, but we have to keep it user friendly) and ready to force its will down on them. If you don't believe that monetary policy is
powerful, go look at the Federal Reserve Rate from 1980 to the present and watch the tumble it took and how much the economy grew from that flushing
of money into the overall supply.
Logical argument to that is "Well the rate is at 0 now, why aren't we booming?" This is due to the fact that we borrowed so much money that
wasn't there, that when the time came to pay it back, its just not possible to do so. Besides, there are other tools that can offset 0% interest,
like government bond actions.
Just a thought.