Questions tagged [currency]

a generally accepted form of money, including coins and paper notes , which is issued by a government and circulated within an economy.

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2
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1answer
58 views

What will happen to the reserves at the Fed?

Banks currently have 2.7 trillion Federal Reserves that they hold at their Federal Reserve account. It's part of the monetary base and these reserves were created when the Fed purchased bonds in their ...
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2answers
107 views

Effect of Strengthening US Dollar on Commodities

Many commodities are prices in US dollars. If the Dollar strengthens, then commodities (in non-US countries) will become more expensive. From the consumers' (suppliers') point of view, this should be ...
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4answers
7k views

Why does any treasury / central bank hold gold?

I know the US treasury is slowly selling its gold reserves, but what is the actual mission and purpose when it comes to the holdings? What is the reasoning behind the slow rate of liquidation? I have ...
2
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1answer
458 views

Would a world-wide currency be a good idea? [duplicate]

While every country has it's own political ideals, enforcing laws and rules, in an ever more globalized world, I believe the idea of fragmented economy is limiting big growth opportunities while ...
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3answers
696 views

Does each stock exchange only trade in one currency?

And if not, how are currency exchange rates accounted for?
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1answer
372 views

Why are CAD, AUD known as commodity currencies

Why are some currencies like CAD, AUD known as commodity currencies?
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2answers
176 views

What are the main differences in a macroeconomic model, i.e. New-Keynesian DSGE, under a currency substitution (full dollarization) scheme?

I have searched arround the web and economic journals trying to find out research related to a macroeconomic model in which the country is fully dollarized, but I haven't had any luck. My main concern ...
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2answers
682 views

What is the relationship between S&P500 and the US dollar

In the recent past, both the S&P 500 and the USD (against other currencies) have appreciated a lot. From what I understand, if USD goes up against other companies, the major companies of the S&...
2
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1answer
280 views

What is the difference between currency manipulation, and a fixed exchange rate regime?

China is labelled by some to be a 'currency manipulator', that is supposedly pegged to the US Dollar. What is the difference between currency manipulation and a fixed regime? Different motives? I ...
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1answer
64 views

what alternatives can possibly back a new currency

A currency can be backed by a trusted issuing authority, by a scarce resource or by the scarcity of its money base (eg bitcoin). Are there any other known working alternatives.
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1answer
472 views

How can the Swiss exchange rate be very biased in a free market?

In 2002, when Germany, France, Italy and Austria adopted the Euro currency, the exchange rate with Switzerland was 1.60 CHF (Swiss Franc) = 1€ (Euro). The prices and salaries in Switzerland were ...
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1answer
61 views

How to determine the worth of a good

I've searched around the web for awhile now and I'm beginning to think this might be an unanswerable question. I want to know if there is a theoretical way to determine the worth of a particular good, ...
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2answers
1k views

What would happen if the world switched to a single currency?

What would happen if all countries suddenly stopped using local currencies and adopted a global currency (like the Euro, but for everyone)?
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1answer
38 views

why the currency crisis must occur at time t0 when the pegged rate equals the shadow exchange rate [closed]

Explain why the currency crisis must occur at time t0 when the pegged rate equals the shadow exchange rate and not before or after t0. Suppose the crisis were to occur at a date before and after t0 ...
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2answers
741 views

What effect would converting the lowest denomination note to a coin be?

In New Zealand our lowest denomination note is a $5 note. For perspective, a can of coke costs $1.50 - $2.00, a Big Mac costs around $5. The idea of a $5 coin is on the cards. The question is - ...
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7answers
4k views

What are the known / alleged problems against using energy as currency?

What are the known (and alleged) problems of using Joules (i.e. a measure of energy/work) as a currency? I tried to find such idea in Google (searched terms like "technocracy", since someone told me ...
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2answers
690 views

What effect would removing the lowest denomination currency have?

Here in New Zealand our lowest denomination coin is 10c after the 5c was removed about 10 years ago. I think generally the public is pretty happy about the move. It's quite a common argument to ...
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2answers
135 views

How Much Gold Did Weimar Have Pre-Hyperinflation?

A few years ago, Peter Schiff and a few other Austrians (not all Austrians, as Mish was stating the opposite) were adamant about hyperinflation and Paul Krugman stated that it was like talking about ...
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0answers
173 views

How does a country increases or decreases it currency value (exchange rate) against other nations currency?

I want to know how a country, Mexico for instance, keeps the exchange rate higher or lower against other nations currency, USD, EUR, JPY. How does the value of a nation currency is valued against ...
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4answers
908 views

What benefits does Bitcoin (i.e. cryptocurrency) offer?

I really, really like moderate inflation. I live in Sweden where the interest rates just went negative because we are on the brink of deflation, and the rate of inflation we have now is far too low. ...
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1answer
674 views

Australian Dollar Devaluation

I am a layman in economics. I am curious about the current devaluation of Australian Dollar in comparison with the US Dollar. Could someone please explain, in simplest words possible: What causes ...
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0answers
39 views

Real time data map about the amount of a currency that are held in the world ?

Where can I see in real time data about the amount of a currency that is held in central banks (and maybe other significant places) ? A map would be great. I would like to know if there is an ...
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2answers
162 views

Unlimited supply of national currency?

I was reading this article about Denmark central bank defending its currency peg: http://www.bloomberg.com/news/2015-01-22/denmark-cuts-key-deposit-rate-to-minus-0-35-to-drive-down-krone.html In it ...
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2answers
441 views

Why was Swiss National Bank in red by keeping fix exchange rate to Euro?

When I read news about the action of Swiss National bank of not keeping fix ration to Euro any more, I read in all articles, that it was too expensive for Swiss National Bank to keep the fixed ...
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3answers
287 views

Market Behavior under expected and unexpected news

I found the following text in the paper "Real-time Price Discovery in Foreign Exchange" The general pattern is one of very quick exchange rate conditional mean adjustment, characterized by a jump ...
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2answers
177 views

How could the Euro zone be broken up in an ordered way?

Let’s assume that the members of Euro zone all agreed that it would end in 18 months time with each country getting its own currency. What process could be put in place to allow this to happen ...
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1answer
3k views

Benefits of a weak national currency

I often hear that developing economies can benefit from a weak national currency. For example China as exporter deliberately makes its national currency weaker, so that it gains an advantage. Are ...
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1answer
461 views

When a country adopts the Euro, what happens to its debt?

When a country, say Greece, adopted the Euro as its currency, what happened to the debt that was based on the Drachma? Was it converted into Euros?
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1answer
52 views

What's the point of adding security features to new bill designs?

What's the point of creating new bills with more security measures to prevent counterfeiting? (For example in the USA the new $100 bills have more security features). If the old bills are still ...
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2answers
164 views

How does the russian interest rate raise will defends the Ruble from devaluation?

This strategy (interest raise to minimize currency devaluation) is being adopted in countries like Brazil and Russia: Brazil interest rate http://www.tradingeconomics.com/brazil/interest-rate Russia ...
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2answers
6k views

What is the advantage and disadvantage to have a high value of USD for USA?

What is the advantage and disadvantage to have a high value of USD for USA? China and Japan always want to keep their currency low as oppose to USA.
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3answers
479 views

The reasons why rouble is collapsing

What can you people say about the reasons why rouble is collapsing? Which one is the main?
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2answers
170 views

Currency Values, Developing Economies and Balance of Trade

For a developing economy like India, where balance of trade is negative, is it good to have a weak dollar or a strong dollar? Dollar value increases (Rupee, the local currency, weakens), imports (...
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3answers
17k views

Real Exchange Rate vs PPP rate

I'm having troubles to understand the difference between the Real Exchange Rate and the PPP rate. I know the first one is calculated using a basket of goods and services so that the non-tradeable ...
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5answers
424 views

Why isn't there an “ideal value” for a given currency? [closed]

If a currency can be worth too little (e.g. needing \$10,000,000,000 to buy a loaf of bread) and worth too much (e.g. being able to buy a loaf of bread for $0.00001), why isn't there an "ideal value" (...