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How to unite currency transcript

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I want to tell you about the future of money. Lets start with a story about this culture that lived in Micronesia in the early 1900s, called the Yap. Now, I want to tell you about the Yap because their form of money is really interesting. They use these limestone discs called Rai stones. Now, the Yap dont actually move these Rai stones around or exchange them the way we do with our coins, because Rai stones can get to be pretty massive. The largest is about four tons and 12 feet across. So the Yap just keep track of who owns part of what stone. Theres a story about these sailors that were transporting a stone across the ocean when they ran into some trouble and the stone actually fell in. The sailors got back to the main island and they told everyone what had happened. And everyone decided that, actually, yes, the sailors had the stone and -- why not? -- it still counted. Even though it was at the bottom of the ocean, it was still part of the Yap economy. You might think that this

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Does buying currency increase value?

These transactions mainly take place in foreign exchange markets, marketplaces for trading currencies. Currencies increase in value when lots of people want to buy them (meaning there is high demand for those currencies), and they decrease in value when fewer people want to buy them (i.e., the demand is low).

What happens when the value of the currency changes and you can purchase more of the other currency?

A currency appreciates if it takes more of another currency to buy it, and depreciates if it takes less of another currency to buy it.

What happens when the value of a currency increases?

A higher-valued currency makes a countrys imports less expensive and its exports more expensive in foreign markets. A lower-valued currency makes a countrys imports more expensive and its exports less expensive in foreign markets.

What is the unified currency?

1. A currency union is an agreement among members of that union (countries or other jurisdictions) to share a common currency, and a single monetary and foreign exchange policy.

What occurs when the currency becomes more valuable relative to another currency?

Currency appreciation is an increase in the value of one currency in relation to another currency. Currencies appreciate against each other for a variety of reasons, including government policy, interest rates, trade balances, and business cycles.

How would a universal currency work?

With a universal currency, the supply and value of money would no longer be controlled at the national level. The entire world would have to agree on how many bills should be in circulation, and what interest rates to adopt.

Why did the European Union develop the euro as its common currency?

On Jan. 1, 1999, the European Union introduced its new currency, the euro. 1 The euro was created to promote growth, stability, and economic integration in Europe. Originally, the euro was an overarching currency used for exchange between countries within the union.

What if the world used one currency?

A global currency would mean all transaction costs related to international finance would be eliminated as well. Exchanging currencies always requires a conversion, which banks charge as a fee, and there can be a loss in value in changing one currency to another. Having one global currency would eliminate all of this.

What happens when currency changes?

1. In the goods market, a positive shock to the exchange rate of the domestic currency (an unexpected appreciation) will make exports more expensive and imports less expensive. As a result, the competition from foreign markets will decrease the demand for domestic products, decreasing domestic output and price.

Why is it important to have a unified currency?

Among the benefits of a global currency would be the elimination of currency risk and conversion costs in international trade and finance. Economically developing nations would benefit from a stable currency and the removal of currency barriers, which would lead to increased trade among nations.

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